Nowadays, there are a large number of lenders of auto loans and all of them compete in the same market. If you are keen to own a brand new vehicle it is easily possible to get auto loans provided you meet the following pre-requisites:
Repayment Capacity
The first and foremost thing any lender looks at is your capacity to repay the auto loans. To facilitate this you must have a proof of your income. The lender might call for various documents – income certificate from employer, bank statements and Income tax returns.
Credit History
Traditional lenders normally depend more on your credit history and charge interest on your auto loans based on the credit score rating. For persons with poor credit history these lenders charge higher rates of interest, even if they consider giving auto loans.
Rates of Interest
Lenders charge interest on the type of car you want to purchase, credit history and period of auto loans. People having bad credit have to repay within 4 years.
Type of Finance
You could loan directly from the bank – direct financing – or you could purchase it from a car dealer – indirect financing. It is also possible to go in for unsecured or secured auto loans.
Analyze the advantages and disadvantages and choose the best one.
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Tags: auto loan, Auto Loans
