So, are you thinking of getting a loan on a car? If yes, then you have arrived at the right page. Here, in this write-up, we have provided some valuable hints and tips on availing a car loan that will be helpful to you for getting a car loan. When it comes to availing car loans then there are many financial competitors present in the market as a result of which availing a loan on a car is not that difficult. However, getting a car loan by making a square deal at a reasonable rate of interest requires a good credit score with a favorable credit history. |
When you go to apply for a loan on a car then the documents that the banking institution is going to ask for are:
•Proof of income •Temporary and permanent residential address •Bank statement of last three months •Photocopies of tax return papers •Other documents if required
Always remember, that the bank that you are approaching for the loan is always going to verify your credit rating as well as credit history.
Bad Credit Car Loan
If you have a bad credit then you have the option of applying for a bad credit car loan. The banking or the financial institution from where you will avail the loan will ask you to furnish the same set of documents but you will be required to pay a huge sum of money as down payment and also a high rate of premium. The time limit for repaying these types of loans may range from one year to four years.
Types of Car Loans
On your part, it is advisable to check out all the terms and conditions as well as the rate of interest before you finalize a deal. Also make it a point to check for any other schemes that are offered by the institution.
Generally, loan on a car can be of two types – long term loans and short term loans.
If you are applying for a long term loan on a car then you will be getting a long duration of time to repay the loan amount. The time duration can range from three years to five years. Moreover, the amount of installments will be small.
On the other hand, if you are opting for a short term car loan then you will have to pay a lower rate of interest. It should be noted that the total amount of interest all throughout will be less than long term car loans. The monthly installments in this case will be a huge amount.
Having a Bad Credit Score
In case you have a bad credit score then it is advisable that you repair the credit before you apply for a loan on a car. If you are paying a greater annual percentage rate of APR on your loan, then it will be a smart option to refinance your car. With the refinancing scheme you can get a better rate of interest.
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