If you are thinking of taking a car loan of ₹10 lakh, it is important to know which bank’s EMI will be most convenient for your budget over a tenure of 5 years. Small differences in car loan rates and terms across major banks like State Bank of India, HDFC Bank and Bank of Baroda can significantly impact your total payment. With this comparison you can easily decide which bank will prove to be the cheapest and most suitable option for you.
On what basis is car loan available?
Any loan is approved after assessing your age, monthly income, CIBIL score and current loan or EMI. Yes, banks give priority in giving loans at the cheapest interest rates to those customers whose CIBIL score is 800 or more. If your CIBIL score is low then you will be able to get loan at higher interest rate. However, the final decision is taken by the bank. Now if you want to take a car loan, the bank will assess you and only on that basis you will be able to get the loan.
What are the starting interest rates?
State Bank of India i.e. SBI is currently offering auto loan for new car at an initial interest rate of 8.90%. Talking about private sector HDFC Bank, it is currently offering car loans at an initial rate of 9 percent. Similarly, Bank of Baroda is also offering car loan at an initial interest rate of 8.50 percent (on fixed rate).
Which bank’s EMI will be less?
- If calculated on the basis of SBI’s 8.90% interest rate, the EMI for a car loan of ₹ 10 lakh for 5 years will be ₹ 20,710. In this you will pay only interest of ₹ 2,42,591.
- If you take a loan from HDFC Bank, your EMI on the basis of 9 percent will be ₹ 20,758. You will pay ₹ 2,45,501 interest on this loan.
- If you take a loan from public sector Bank of Baroda, your EMI will be ₹ 20,517 at the interest rate of 8.50 percent. You will pay ₹ 2,30,992 interest on this loan.
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