Who can apply for a car loan? Car Loan Eligibility

Who can apply for a car loan? Car Loan Eligibility

By Ankita Patil
SHARE

Can I Apply For A Car Loan?

The banks have provided certain eligibility criteria for issuing car loans. You need to be in good employment, have income statements and tax returns for availing car loans.

Well, car loans serve as a boon for accomplishing your dream of owning a brand, new car or used car. But you start thinking whether you are competent or capable of availing the car loan or not. Yes, you can evaluate yourself as per the eligibility criteria provided by the lending institutions. If you are eligible, then go ahead with the application process. And if you are not eligible, then do not worry. Work on your loopholes and strive to get your dream car in the future.

Let us discuss the eligibility criteria for availing car loan.

Eligibility with reference to residential status

Of course, you can avail car loan if you are a resident of India. But if you are a non-resident, then you can also apply for a car loan. It is assumed that being a non-resident, you have a bank account in India. You can approach the bank and apply for the same.

It is suggested that you must approach the bank wherein you have a salary or savings account. However, you are also open to approach other banks for availing competitive rates and offers.

You cannot jointly own a car. An individual only can apply for car loan in India. The ownership of the car is not distributed between individuals.

Age is just a number

For availing car loan, your age must be between 21 and 65 years. This is because the lender must understand that you are capable of repaying the loan amount.

Income is not just a number

Your income is an influencing factor to approve your car loan. It is provided by most of the banks that your net income must be at least Rs. 2,50,000 in a year. The greater the income, the higher are the chances of loan eligibility.

Employment does the matter

You must be in employment with a reputable organization. And you must be employed in that company for a substantial period. This will help you in furnishing the income statements. The income statements and the salary slips will automatically reflect your good earning status. If you are in employment for a long period, then the lender is satisfied that you are having the requisite repayment capacity.

Now, what if you are a businessman? Yes, you have the opportunity to avail car loan. For that, you can submit to the bank your income statements such as profit and loss account and balance sheet. You must be also filing tax returns. You must submit these tax returns.

Credit score – an essential component

One should never forget the credit score. Banks will check your credit score before approval. If your credit score is good, your chances of loan approval are greater.

You must have seen bank advertisements offering car loans only on the basis of income statements. Yes, it plays an integral role. Thus, you can avail car loans if your income status satisfies the banking norms.

Recommended Read :

RELATED ARTICLESMORE FROM AUTHOR

2 COMMENTS

  1. Buying a car can be a little overwhelming, especially when it comes to the finances. Not everyone can afford buying a car without getting it financed. Taking a loan for buying a car is a god option. One can choose from a variety of lenders. The eligibility criteria is well discussed in the above article. Great job!

  2. To own a car is a dream for many of us but to work for it is accomlishing your dreams. The checkpoints provided by the bank is in a way to evaluate oneself. It helps if one is really able to own a car. It will be sheer wastage of time if the income or the credit scoring is low.

Comments are closed.