Question 1

How is car loan EMI calculated monthly?

Accepted Answer

EMIs or Equated Monthly Installments refer to the monthly payments you make to the lender to repay your loan. These payments include the principal amount as well as the interest i.e. EMI = Principal Amount + Interest on Principal amount. Mathematically, EMI can be calculated using the following formula: {P x R x (1+R)^N / [(1+R)^N-1]} where, P = Principal amount of the loan, R = Rate of interest and N = Number of monthly installments.

Question 2

What is a Car Loan Repayment table?

Accepted Answer

A Car Loan Repayment table represents the periodic loan repayment schedule of your car loan. It consists of the breakdown of your car loan repayment details such as the principal loan amount, EMI, interest payment, and the outstanding due after each EMI payment.

Question 3

Who can avail a Car Loan?

Accepted Answer

Anybody who falls under the following categories can avail a car loan: Self-employed individuals or, Salaried individuals

Question 4

Does the EMI amount depend on the repayment tenure?

Accepted Answer

Yes, the EMI that must be paid will depend on the repayment tenure that you have selected. The EMI will be lower in case the tenure is longer.

Question 5

Can the car loan EMI be changed in the future?

Accepted Answer

Based on whether you have chosen a floating rate or a fixed rate, the car loan EMI will change. In the case of floating rate, the EMI will change based on the rate of interest for the month. However, the EMI will not change if you have opted for a fixed rate.

Question 6

What are the benefits of using an online Car Loan EMI Calculator?

Accepted Answer

The online car loan EMI calculator can be found on the bank website or a reliable third-party website. The tool is easy to use. You can use it any number of times for free. The results are instant and accurate whereas manual EMI calculations are prone to human error and are time consuming. You can also input varying combinations of the loan amount, loan tenure, and interest rates to get revised results.

Question 7

What are the documents required for availing a car loan?

Accepted Answer

Documents for Identity proof, address proof, and income proof are required by banks. For Identity Proof: Aadhar Card /PAN card / Driving License/ Passport /Voter’s ID (any of the following) For Address Proof: Aadhar card /Passport / Driving license / Ration card / Utility bills(any of the following) For Income Proof: For Salaried individuals - Salary slips, ITR, Form 16 For Self Employed - ITR, Audited Balance Sheet, Audited P&L

Question 8

How much do I need to pay a down payment for a car loan?

Accepted Answer

The Downpayment can affect the interest rate, monthly payment amount, and tenure of the loan. Some key factors that affect the size of downpayment are whether you are buying a new or used car and your credit score. While there is no one-size-fits-all answer for how much of a down payment to make on a car, but a high downpayment will reduce the size of the loan you'll need to cover the cost of the car, which brings down the lender's risk as well.

Question 9

Can I get a car loan for a used car?

Accepted Answer

Yes. Many bank partners like ICICI, HDFC, IndusInd, IDFC, etc provide loans for used cars.

Question 10

What conditions do I need to fulfill to get a car loan for a used car?

Accepted Answer

The eligibility criteria for a used car loan are similar to a new car loan. Some banks might insist on checking the condition of the pre-owned car before giving the loan.

Question 11

Can NRI apply for a car loan in India?

Accepted Answer

NRI can get a car loan in India if they a resident Indian as guarantor. The age of the NRI taking a loan and the guarantor should be between 21 to 65 years. The maximum car loan duration for NRI is seven years.

Question 12

How much car loan can I get on salary?

Accepted Answer

If you are a salaried individual, you can take a car loan of up to 48 times your monthly salary. Your Minimum salary should be Rs. 2.5 lakhs per anum while your age should be between 21 to 65 years.

Months	Principle	Interest	Balance
12	Rs. -4,71,208	Rs. 4,71,208	Rs. 49,71,208
24	Rs. -5,20,550	Rs. 5,20,550	Rs. 54,91,759
36	Rs. -5,75,058	Rs. 5,75,058	Rs. 60,66,818
48	Rs. -6,35,275	Rs. 6,35,275	Rs. 67,02,093
60	Rs. -7,01,796	Rs. 7,01,796	Rs. 74,03,890

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