Applying for an auto loan is simple and easy as compared to Home Loans. The reason is the amount involved is smaller, and the documents required are simple to obtain. With the increased competition among banks and firms, it takes less than a week to disburse the loan. However, after you have selected the car and the bank for the loan, one needs to understand the process involved in availing an auto loan.
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Discussion with Lender
Once the lender has been selected, the applicant must have a thorough discussion with the concerned officials of the bank, in order to get the best deal. The importance of this part is the power to lower the amount of loan in the long run. One should take advantage of the offers provided by the firm. Decide the dates on which you can submit the complete documents along with the application of the loan.
The documentation is the part where the applicant role is maximum. The important documents required to avail an auto loan are income proof, address proof, identity proof, and proof of signature. Usually, the Documents required are the same in case of all banks, but these may change in case of salaried and self-employed people.
Processing by Bank
When you have submitted all the documents to the bank, then the processing of the loan begins. An agent from the bank visits the customer’s residence and the place of employment for verification. In case of any discrepancy, the agent will first try to find out errors with the help of the applicant or may revert to the bank manager with details. Once the validity of the information has been confirmed, the approval in the bank is relatively simple which can be completed in a day.
Approval and Disbursement
The approval by the lender is based on the validity of the information given by the applicant. Once the approval is over, the client is informed either by phone or through the mail of the same and is given a date for collection of the cheque in favor of the dealer, from whom the car is being proposed to be bought. The disbursement is usually made in a single payment with the full amount required.
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