If you are planning to purchase a vehicle, then this might be a good opportunity for a financial assessment. Union Bank of India has launched car loans with an initial interest rate of 7.90% per annum, which is one of the most competitive rates available. Another leading lender, State Bank of India (SBI), however, offers loans at a comparatively higher interest rate of 9.10% per annum.
What to keep in mind before availing a car loan
- Rate of Interest: EMIs are directly related to the interest rate, and lower rates mean lower overall expense. Union Bank's 7.90% rate is much more favorable than the 8% cutoff, meaning the borrower saves a lot.
- Loan tenure: Monthly repayment, interest incurred, and overall cost can all be influenced by the duration of the loan. Ensure that your loan tenure makes sense in relation to the total payout, and confirm the tenure being offered.
- Compare offers: Different banks have different processing fees, terms and conditions, and even basic eligibility criteria. A better quote for you can be found through such a comparison.
Why this matters
Moreover, the rising cost of cars makes owning one with the help of a loan, which has a lower rate of interest, more feasible. Currently, Union Bank offers a very competitive rate, which can benefit potential car buyers looking to lighten their financial burden.
Industry experts recommend that, before you finalize the loan, buyers should review all terms and conditions, including prepayment charges and documentation requirements, to avoid surprises later.