Planning to take pre-owned car loan? 7 points that you should keep in mind

Here is how the used car loans offered by various banks stack up

Sanjay Kumar Singh | New Delhi
Last Updated at August 26, 2019 01:35 IST

Since interest rates on these loans are high, borrowers can even explore options like personal or top-up home loan

Interest rates on used car loans vary widely—from 8.8 per cent to 16.65 per cent
On a Rs 5 lakh loan taken for five years at the lowest rate (8.8 per cent) , the EMI would be Rs 10,331 and the total interest payable over the loan tenure would be Rs 1,19,843
On a similar loan taken at the highest rate of 16.65 per cent, the EMI would be Rs 12,332 and the total interest payable would be double at Rs 2,39,943
Do compare interest rates using online web sites before deciding whom to apply to
Loan tenures can vary from three-seven years. Remember that a longer tenure lowers the EMI but raises the total interest cost on the loan
Some banks have steep maximum limits on processing fee going up to Rs 11,800 which you should watch out for
Since used car loans are expensive, buyers can even explore the option of taking a personal loan (if it is cheaper) or even a top-up on an existing home loan. You could get the entire amount you need via these types of loans

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