5 Smart Tips to Get the Lowest EMI Car Loans
Buying a car can be very exciting – but also a little daunting in terms of the financial commitment! Buying a car, and getting a car loan to help make the purchase, can be the first big financial commitment that many people in India make. Buying your own vehicle can give you an exhilarating sense of freedom but is also accompanied by some natural concerns—how to find low interest car loans and low EMIs.
With a plethora of financing options available in the market to choose from, it is now easier than ever before to buy a new car while at the same time not spending huge amounts on interest costs. Use the competition to your advantage and find the best car loan deal with lowest EMI!
Additional Reading: How to Apply for a Car Loan in India
Below are some tips on how to get the Lowest EMI Car Loans:
1. Research and shop around: Often the most ignored of all tips—it is often a good idea to get rates from several lenders and car dealerships. This way, you get to know who offers the best deal.
2. Negotiate for a good deal: Do not just settle down for the first financing deal offered to you. Negotiating may lead you to better offers, like a reduced interest rate, penalty-free pre-closure, etc., leading to lower EMIs.
3. Check your credit score: It is important to obtain a copy of your credit report well in advance of applying for car loan to check your credit score and minimize the chance of rejection. If you apply with a low credit score, your application may be rejected which will affect your future attempt to secure a car loan. Or you might be offered unfavourable interest rates because of your poor credit record.
4. Concentrate on improving your credit score to at least 750, before applying: Lenders generally look for a credit score of 750 or above to sanction a loan. A higher score means you can avail of more attractive terms which will lighten your EMI burden. Improving your score can take an average of 4-12 months, depending on how serious your credit situation is. Also, check your credit report for any errors that are needlessly dragging down your score. It is important to quickly file a dispute if you detect any errors and get it rectified.
5. Read the fine print carefully: Check the fine print carefully for hidden charges and ask for an all-inclusive quote. The various additional fees can amount to thousands of rupees. Negotiate for a better price and calculate the impact on your overall EMI costs.
Additional Reading: How to Get a Loan for a Used Car
Most importantly, do not rush the decision. Auto loans mean a commitment of several years and it is important to find both the vehicle and the car loan offer that is most suitable for your budget and needs.