Money cannot buy happiness , but it can sure buy you your dream car , which is close enough for buying your happiness. If you want to buy a car and don’t have funds, then now you don’t have to wait for months and years. India’s largest government owned bank SBI offers the best deal for financing your new car and turning your dream into reality easily with lowest interest rates, lowest EMI, minimal documentation and quick disbursement of car loans.
SBI car loans can be offered for the longest time periods i.e. 7 years. SBI also provides finance for both new cars as well as old cars. But it does not provide loans to more than five yr old cars. Loan amount from SBI includes one time road tax, registration fee and insurance premium also.
Additionally SBI provides free Personal Accident Insurance up to the outstanding amount, so that in case of accidental death, your family and relatives are not required to pay the loan.
SBI Car Loans Interest Rates
The interest on SBI car loans is charged at a certain rate and this rate can be either fixed or vary according to the market fluctuations. In fixed interest rate loans, the interest remains the same for the entire tenure of the loan. In Floating interest rate loans, the interest rate keeps changing with the change in base rate of the loan. The car loans interest rates are calculated on a reducing balance with monthly rests.
The SBI car loans interest rates for a new car for any tenure are 9.70% per annum for men and 9.65% per annum for women. Interest rates for an old car loan are much higher than the interest rates on a new car loan.
For pre-owned certified cars, the car interest rates for any tenure are 10.40% to 12.65% per annum for men and 10.40% to 12.65% per annum for women.
Factors Affecting SBI Car Loan Interest Rates
- Car model and age: The vehicle itself is considered as collateral and is pledged as surety for the loan to the bank for the loan tenure in a car loan. The older the car, higher will be the car loan interest rate according to the aspects of a car’s market value.
- Income: Income of the applicant helps the bank to figure out the time that applicant need to pay back the loan. Lower income of the applicant decreases the probability of pay back and hence the bank has more confidence in repaying abilities .
- Credit History: Higher credit score helps in getting the loan as well as empowers the applicant with a strong bargaining power.
- Loan tenure: Higher interest rates are charged for a loan of shorter time period and low interest rates are charged for higher time period.
- Loan size and down re-payment: Lower interest rates are charged for the higher down payments. Higher interest rates are charged for small cars and used cars.
- Category: Regular government employee, public sector undertaking, private company or corporation, self employed businessmen, professionals, any partnership firm and people involved in agriculture and its allied activities are eligible for SBI car loans.
- Income: Any regular government or private corporation employee with minimum net income of 3,00,000 INR per annum; any professional and self employed businessman with minimum net profit or gross taxable income of 4,50,000 INR per annum and any person involved in agriculture with net annual income of 4,00,000 INR can apply for the SBI car loans.
- Age: The applicant must lie in the age bracket of 21 to 65 years to avail SBI car loans.
Maximum Loan Amount
Maximum SBI car loans amount for any regular government and private corporate employee is 48 times of net monthly income. For professionals and self employed businessmen the maximum SBI car loans amount is 4 times net profit or gross taxable income as per ITR after adding back depreciation and repayment of all existing loans. For people involved in agriculture and allied activities the maximum loan amount is 3 times of net annual income.
- Statement of bank account for last 6 months
- 2 passport size photographs
- Proof of identity: copy of passport/ PAN card/ voters ID/driving license etc
- Address proof: copy of ration card/ voters ID/ passport/ telephone bill/ electricity bill/ life insurance policy
- Income proof: latest salary slip and form 16 for government or private corporate employee and ITR for last 2 years for self employed businessmen or professionals
- Returns or Form 16 for the last 2 year
The EMI can be calculated also be calculated through a formula i.e
Where , P = loan amount, this should be 85% on road price
r= rate of interest
n = tenure in months, for SBI it is 84 months
Before finalizing the lender, one should not only compare the rate of interest or EMI but also calculate the total amount payable. SBI charges 0.51% of loan amount as processing fee on Certified Pre- owned car loan . the minimum processing fee is 510 INR and the maximum payable amount is 10,350 INR.
Another attractive feature of SBI car loans is that one have to pay any advance EMIs that means there is no need to pay any amount as EMI prior using the car.