Like any average Indian who wants a good life, you probably yearn for these two things – a house of your own and a car. Now, while buying a house may be too expensive right now or you might already have one, getting the car of your dreams is usually easy nowadays. You just need to avail a loan on a used car of your choice.
This way, you will be saving a ton of money on the car make and model as well as the loan itself. Unlike a new car, used cars are affordable in terms of insurance as well. Plus, you can get your dream brand or model without shelling out your entire savings. Used car loan rates are highly competitive as well, with most leading lenders offering these loans currently.
know about the many benefits of getting a used car loan:
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Affordability
Used cars cost less than brand new cars, as you already know. Even a super stylish model loses its value in depreciation after a year. Which means, you can easily get the car you want at a lower price if you opt for a pre-owned version. And since its priced more affordably, you will need to take out a smaller than usual loan on used car.
The smaller the loan, the easier it will be for you to pay back. The interest rate will be more attractive as well, and you might be able to settle for a short tenure. And this will make your total interest cost burden more manageable as well. So, you will become debt-free soon.
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Easy application
You no longer need to visit financial institutions physically and find out about their loan terms. You can simply visit their websites and check used car loan rates, tenures, terms and conditions. You can also check out aggregator sites to compare offers from different lenders.
Many financial institutions have mobile apps too, which make it simpler to apply for a used car loan with a few clicks. This saves your time, energy and money.
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Fast processing
As long as your second-hand car is from a reputed dealer, certified and in good shape. You shouldn’t have any trouble getting your loan approved. Just make sure all the necessary paperwork is in place. The lender might also look at other factors like your income, job or business stability, credit score, the loan amount you need etc.
However, if you make a large down payment and take out a small loan, you are likely to get fast approval. It is easy to present yourself as a trustworthy borrower in case of a used car loan, since you will need a smaller loan amount usually, than in case of new car loans.
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Simple paperwork
While taking a loan on used car, remember that you need to provide only basic documents (or their soft copies) to get the loan processed. Usually, proofs of income, identity, and address are required.
You will also need to furnish passport size photographs and fill up a simple application form. Also, whether you are self-employed or salaried, most top lenders in India offer used car loans to both kinds of borrowers.
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Flexibility
These days, most financial institutions offer flexible terms when it comes to second-hand car loans. Based on your convenience, you can choose from different combinations of loan amount, interest rate and tenure.
Most lenders have EMI calculators on their websites too, simple tools that allow you to calculate the EMI you will probably be paying. This makes it easy for you to choose the tenure and loan amount easily. Also, the more creditworthy you are, the more flexibility you will have.
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Chance to build your credit score
Used car loan rates are usually attractive. And since the loan amount you need will be most likely lesser than in case of a new car. Paying off the monthly EMIs will be easier. And when you continue to pay the EMIs on time every month, it will boost your credit score.
This means, in future, if you plan to buy a brand-new car or a more expensive used car model. Which requires you to take a bigger loan, your request will be approved easily.
To wrap up, it is easy to see how getting a loan on used car is a good and pocket-friendly idea. Whether you are new to the world of driving and afraid of denting a new car or you are on a budget. Buying a pre-owned car has many benefits for sure. And with multiple financing options available nowadays. You can simply do your research, compare different lenders and then take a loan that suits your needs and budget.
