Here are the 5 points that you must check before taking a Luxury Car Loan. Working in a well-known startup as Chief Marketing Manager, Rohan was planning to buy a premium luxury car. He was in love with Mercedes-Benz cars and has dreamt of buying Mercedes-Benz C-Class. Rohan was aware of the fact that he cannot afford this car if he will consider his salary only. He had to take a car loan to satisfy the high price tag of the car. Sitting in a café, he was in deep thinking about how he will take a car loan. What should he consider and what should not. This can be your situation also. If you are also planning to buy a luxury car, you can also be in a dilemma known as car loan dilemma. There are some points that you must keep in mind while taking a luxury car loan. Because it’s all about your money. You are going to spend Rs. 20 lakh or Rs. 50 lakh to buy a car, so you must choose wisely. Here is a checklist of 5 must-read points before taking a luxury car loan:
The important points to know for a luxury loan:
With the increase in India’s economic conditions, the purchasing power of the individuals has also increased and has become strong in comparison. That makes owning a luxury car as a desire in the necessity list of standard life. The major five important things to consider before applying for a luxury car loan:
● Interest rate: Compare various car loan offers across top banks and choose the lowest interest rate car loan. Opt for a floating interest rate car loan for a short loan tenure and a fixed interest rate car loan for a long tenure.
● Loan tenure: Choose a shorter loan tenure to pay off the car loan at the earliest. A shorter loan tenure means higher EMI payments but a longer loan tenure means higher interest payment.
● Processing fee: A percentage of the principal loan amount is charged as a processing fees by banks. If you do enough research you may come across banks that offer a processing fee waiver. Thus, saving you from paying a significant sum of money at the time of obtaining the loan.
● Prepayment charges: After 12 EMI payments, customers can prepay the outstanding loan amount. However, banks charge a prepayment fee for repaying a part or whole of the loan before the end of the loan tenure.
● Down payment: Always volunteer to make a significant down payment on the total price of the car. A higher down payment means lower interest and EMI payments. Ensure your car loan EMI payment doesn’t exceed 50% of your salary.
Tips to obtain auto financing for luxury cars
Those who are looking to purchase a high-end car mustn’t shy away from doing adequate research before applying for an auto loan. Take a look at some helpful tips to get better car loan deals:
●Look for a low rate of interest models.
● Try making large down payments to get a low-interest rate on the availing loan amount.
● Have proper financial support before going to a c four wheeler showroom.
● Banks offer better deals for existing customers.
Select a loan with a short loan duration to Ignore paying more in interest.
● Purchasing a pre-owned luxury car is an alternative to spending huge sums of money on a new car.
●Lease a luxury car instead of buying one if you are the type of person who likes to change their car every couple of years. The lease payment is comparatively lower.
However, it helps to remember that lease is an option only if you don’t put more than 15,000 miles in your luxury car or else you may end up paying high service charges and incur other fees.
These are the 5 points that you must check. If you are done with all these points, then you can mark a full stop on your search and take a car loan for your luxury car.
Apply for ICICI Bank car loan
Apply for HDFC Bank car loan