Jan 15, 2021 ●10 min read
11 Things to Remember While Taking a Used Car Loan
A used-car loan is a loan applied for by the borrower to buy a second hand car that is up for sale. Many argue against taking up a used car loan, however, if you want to upgrade yourself from a two-wheeler to a four-wheeler and fall a little short of finances, this is a great option. Usually, in a used car loan, you get 80% of the actual price as a loan amount; the lenders can offer attractive and competitive interest rates with flexible repayment options. Now that we know what a used car loan is, let us have a look at some of the factors that you must take into consideration before applying for it.
When you are applying for a used car loan, there are a few things to keep in mind including the finalizing the budget, loan offers and deals, authenticity of the lender, the interest rates offered, etc. Let us take up each factor and know what to look at while applying for a used car loan.
Before applying for the instant personal loan for used cars, borrowers must make a budget for themselves and shortlist the cars that fall in that budget. Remember that in a used car loan, borrowers usually don’t get offered a 100% of the loan amount; it ranged between 75% - 80%. Hence, make a budget and make sure that you have enough finances to pay for the remaining 20% - 30% amount.
Before short listing on the loan options available with you, we would suggest you to have a look at all the specifications of the used car you have your eyes on. This is important because when you apply for a used car loan, you might be asked to submit the car documents to check the amount which can be disbursed as a loan for it. Therefore, make sure that the car you are buying is worth the loan and doesn’t fall outside the terms and conditions of the lender.
When we say that you must calculate the value, we talk about the resale value of your car. If the resale value of that used car can pay off a few years later, then it makes it a good option to be in your yard. You can recover the loan costs off of it and ensure that it will last for a long time.
Needless to say, whenever you are out to buy any vehicle make sure to take a test ride to know the comfort level, performance, and functioning. Why is it important before applying for a used car loan you ask? Well, it is important because you are committing to an investment for which you will be paying EMIs.
For a used car loan, it is wiser to negotiate on the actual offered price beforehand so that you can apply now for the loan accordingly. Look for pleasant deals and offers and cash on them. Do the effort for one of the most valued possession.
Once you are thorough with your car research comes the second and most important leg of the process. Look for a perfect lender who offers second hand car loans and check for their services and offers, customer support, ease of loan repayment, flexibility and much more. Always makes sure to do bit of research before applying for a used car loan with any lender.
Every lender has a different lending process and different terms of agreement. Check the eligibility requirements and be prepared with details and documents. Some of the eligibility terms of lenders include the proof of income, registration documents of the vehicle, proof of life of vehicle, etc.
Talking about terms and conditions of the lenders, when applying for a used car loan check for the terms and conditions stated by them. One of the key factors is the interest rate of a used car loan which can range between 10.50% and 18% per annum, depending on the age of the car.
Read through the documentation requirements as requested by the lending companies and prepare all of them. Some of the document requirements include; KYC Documents (Aadhaar Document, PAN Card, Income Proof, Bank Statement of 12 months, Vehicle registration documents, etc.
While applying for a used car loan with any lender always have a good look at what are the repayment options offered by them. Lenders these days are quite flexible with the repayment of loans with various offers and schemes in place. Make sure to pick the right one after learning everything about the terms and conditions involved.
Since the lending companies rely on technology for loan assessment and disbursal, the process has become quicker. Now loan approval takes just a few business days. When applying for a used car loan, look for fintech lender that offers hassle-free, quick loans with minimal documentation for quick loan disbursal.
Applying for a Used Car Loan at Zavron Finserv is comparatively easier. You can apply for it easily on our website. Here is the detailed process of application of a used car loan.
- Visit our website www.zavronfinserv.com
- Click on ‘Apply Loan’ tab in the right corner above
- Fill the loan application form with details like, type of loan, full name, contact number, and your message.
- Once you fill out the details, submit them. Post submission, we will quickly verify the details and let you know of your eligibility.
- Submit the documents after the application approval. The list of documents required is - KYC Documents (Aadhaar Card, PAN Card), vehicle registration and other documents, and Bank Statements.
- We will verify the documents and let you know the loan amount you are eligible for.
- After a quick verification, the loan amount will be disbursed to your account.
Ans: No, getting finances for used car is not difficult at all. However, you will have to make sure that you have a good credit history and meet all the eligibility requirements of the lender.
Ans: At the time of buying a second hand car check for the authenticity of the dealer, check the vehicle thoroughly, get the right documents of the vehicle and check car history.
Ans: Unfortunately, Zavron Finserv eligibility policy states that the vehicle must not be older than 7 years to take a used car loan.