Buying a new car is very easy in the modern world. There are tons of offers out there to help finance a new car. But, at the same time, there are also high chances of the loan request getting rejected with the Credit Information Bureau (India) Limited (CIBIL) having a close watch on a person's account and history.
So how does one get a loan for a new car or vehicle? IndiaLends, a company based in Delhi that connects customers looking for low rate loans with institutional lenders explains four simple steps finance a new car, which for a majority is the second most expensive investment after a house.
1. Budget all your expenses
First and foremost, budget all your expenses. Calculate how much EMI you can pay per month, along with other expenses such as insurance, registration, fuel, and most importantly, maintenance of your car. There is no point in buying a car if you are not able to use it frequently and maintain it. Fuel and maintenance is an expense that has to be spent on monthly, and sometimes it comes as an unexpected expense.
2. Check your credit scores before applying
Your credit score or CIBIL score plays a very crucial role for lenders (banks or private firms) to approve the loan. The higher your score is, the more chances there are for banks to approve your loan and also, for you to negotiate the rate of interest. The secret to have a high CIBIL score is to pay up on time!
3. Find a co-applicant
Get a family member, or your wife/ husband to sign as the co-applicant for the loan. This will further strengthen your credit worthiness, help you apply for a larger amount, and negotiate interest rates compared to signing up for a loan by yourself.
4. Include accessories as well with the loan
There are lenders who finance accessories for your car as well. Include that in you loan amount, since many opt for accessories that could go out of your budget. Accessories like a decent music system, seat covers, alloy wheels, etc could also be included.
Keep these four easy steps in mind and redo the calculation if you have plans to get a new car financed. There is a high chance that you could have not included something essential, which could make a difference.
IndiaLends is an online marketplace that helps connect customers looking for loans with low rate of interest with institutional lenders. The company is based in Delhi, and is headed by Gaurav Chopra, who is the Founder as well.