You must have heard on numerous occasions how owning a car can be cumbersome and stressful with all the upkeep required. But did you know you can avail a Loan Against Vehicle? Yes, you read it right, Loan against car, your very own car! Owning a car can be useful when it can also get you a quick loan.
One might need funds for various personal reasons, be it a wedding or even a medical emergency. At such times, it can be inopportune to divert your attention in selling your assets. Instead, you can avail a loan against vehicle to bridge your temporary financial needs. Such loan against vehicle can be one of the quickest ways of funding in times of your urgent needs.
Loan against vehicle interest rates starts from the thirteen per cent mark. It can be an affordable source of finance, considering personal loans available at competitive rates. Availing a loan against vehicle is a form of personal source of funding as the amount of the loan can be used for any purpose. There is no restriction on using the loan for a particular purpose.
Loan against vehicle eligibility can be sought after contacting your financial institution. You are eligible if you have availed a loan to purchase your car. The EMI’s on the earlier availed car loan needs to be repaid without defaults for a considerable duration, say eight or nine months. The lender checks for the track record of your loan and grants you a fresh loan against vehicle.
Loan against car depends on the variant and age of the vehicle. Apart from that, a car in a pristine condition offers a higher amount of credit. It can range from the actual value of the car to a whopping 1.5 times its value! Loan against vehicle documents are relatively basic ones.
As one needs to generally provide their income proof, age, identity proof and address for any loan, the same are required for a loan against vehicle. If you belong to the salaried group, you further need to provide a copy of your latest salary slips. The self-employed group need to produce their return of income. The loan against vehicle eligibility is determined after examining such documents.
While you obtain a loan against vehicle, you should take adequate care for repayment. Non-repayment or default in repayment can negatively impact your credit score. Adverse impact on your credit score can hamper your creditworthiness while availing a fresh loan.
Make sure you do adequate research and finalise the lender. Alternatively, your existing banker can help you get pre-approved loans with minimal documentation. An application can be made in person or online as well depending on the services provided by the bank/ NBFC.