Used cars are now more popular than ever before in India. A steady stream of car owners upgrading to larger, more expensive cars means that there are a lot of interesting, well maintained vehicles landing into the used car market. While zeroing in on their dream car in the pre-owned market, one of the biggest challenges faced by buyers is the lack of convenient finance options. We've put together various ways in which your used car purchase can be financed. You may be pleasantly surprised!
Pre-owned car loan from a bank
In case you thought banks sanction loans only on brand new cars, you are wrong. With growing demand of preowned cars and in turn the need for finance options, almost all leading banks now provide loans on pre-owned cars too. Getting approvals for a used car loan is hassle free these days and you do get to enjoy all the benefits including flexible repayment tenure of upto 7 years, increasingly lower rate of interests and availability of upto 80-85% of the value of the car as loan amount. Further, certified cars like those of Maruti Suzuki True Value enjoy an ever better, i.e., lower rate of interest. And of course, similar to new car loans, you can apply for pre-closure if you want to sell the car back or have enough funds in hand.
A lot of used cars are affordable enough for your credit card to handle the purchase. Yes, a lot of used car dealers in the organized segments allow customers to swipe credit cards for purchasing cars. Entry level used cars such as Maruti Suzuki Alto selling for under Rs. 2 lakhs is not uncommon. So, if you have a credit card with a credit limit between Rs. 2-3 lakhs, you can easily drive home an entry-level used car by simply swiping your credit card. You can then convert the purchase amount into EMIs for upto 24 months. There's a downside to this though. Your credit limit effectively is blocked until you repay the EMIs. Personal loan Have a good credit history? Well, you can then opt for the 3 second loan that many leading banks such as HDFC and ICICI now offer. Such '3 second' personal loan offers involve no paperwork and are disbursed after an online application process that takes less than 5 minutes. After filling in the application, the loan will be disbursed to your bank account in seconds. Purchasing your used car with this money is yet another option. However, you may have to shell out higher interest rates for such loans.
The great thing about India is the support system of family and friends. If you don't have a credit card nor a bank willing to lend you money through a personal loan, you can always bank on your family and friends to help you out for your car purchase. Assuming that you need a loan of about Rs. 200,000, splitting this amount into 20 pieces and getting Rs. 10,000 each from a bunch of friends can help you bridge the gap and drive home that car you've always wanted. You can then repay each friend Rs. 10,000 every month and get done with the crowdfund repayment in 20 months. Almost like an EMI? Well, it is.
Fixed deposits as Collaterals
Well no, we're not asking you to break the fixed deposit. Rather, why not used the FD to instead act as collateral against a car loan? Many banks and non-banking financial companies (NBFC) give out loans against fixed deposits. You could take this option to borrow money in order to finance a pre-owned car, and then repay the loan over a longer period of time. Of course, you're risking your savings using this approach.
Maruti Suzuki True Value Financing Options
If you don't want to get into any hassle of going to banks or asking your friends, Maruti Suzuki's True Value showrooms can be your one stop solution for your used car related finance needs. Yes, they not only house your pre-owned dream car but also assist you with best loan options through a tie up with more than 37 finance partners (private and public sector banks, & NBFC's). Since, certified used cars at True Value have the lowest bank interest rates and additional promotional offers, the whole process of getting your car financed seems like a breeze here.
These car financing options will not only make your dream car arrive at your home a lot earlier than you thought, but also help you make a wise decision in choice of a car.