A little preparation can save you a lot of interest over the life of a vehicle loan.
Before you apply
- Check your credit report and correct any errors. Higher scores generally get better rates.
- Know your budget. Use the EMI calculator and eligibility checker to find a loan amount and tenure that fit comfortably.
- Save a larger down payment if you can — it lowers the loan, the EMI and total interest.
- Clear or reduce other debts to improve your eligibility.
Compare lenders on the total cost
Do not compare the interest rate alone. Look at:
- Whether the rate is flat or reducing balance (use the converter).
- Processing fee and other charges.
- Maximum financing and tenure.
- Prepayment and foreclosure terms.
- Whether insurance or extras are bundled into the loan.
Apply smartly
Submit applications together over a short period rather than one by one across weeks, and avoid unnecessary applications, since each formal enquiry can affect your credit score.
After the loan
- Set up auto-debit so you never miss an EMI.
- Use surplus cash to part-prepay early — the largest interest savings come from early prepayments.
- After the final EMI, collect the NOC and have the hypothecation removed from the RC.