Finance: Finance Car
What Is Car Finance?
Car finance is basically borrowing money to buy a car. Instead of paying the full price upfront, you agree to make monthly payments over time. The lender (this could be a bank, dealership, or finance company) covers the initial cost, and you repay them in instalments.
Eligibility Of Car Finance
| Particulars | Details |
|---|---|
| Minimum Age of the Applicant | 18 years |
| Maximum Age of the Applicant | 60 years (Salaried) / 65 years (Self-employed) |
| Minimum Annual Income | Rs. 3 lakh |
| Car Model | Any approved car model |
| Type of Employment | Salaried or Self-employed |
| Country or Place of Residence | India (Rural / Semi-urban / Urban areas) |
| Duration of Stay in Residence | Minimum of 1 year |
Benefits Of Financing Car
1. Safety and Reliability
Essentially, a reliable car is one that you can trust to start each day and one that will not cause you problems in terms of breakdowns, repairs and other issues. In addition to ensuring that you can always get to where you need to go, reliability is important in a car because this can save you money in the long run.
2. Purchase As If You’re a Cash Buyer
Negotiate price confidently, avoid dealer markups, focus on total cost, not monthly payments—act like you’re paying fully upfront.
3. Spread Out The Payments
A spread in finance typically refers to some form of difference or gap between two related values. In stock trading, the spread generally refers to the gap between buying and selling prices. In bonds, it indicates the yield differential between two securities.
For example, Bank ABC charges customers 5% interest for car loans and pays out interest to depositors for holding their money at a rate of 1.85%. It means that the interest rate spread will be 5% – 1.85% = 3.15%.
4. Security Leads to Quality
This means that if you are unable to pay the money then your car will go to the agency. That is all that happens.
5. No Deposit Required
Meaning you can deposit as much money as you want, there is no criteria that you should deposit only this much money. Which is very good for you.