In this hustle-bustle of everyday life, it is more convenient to travel with your vehicle instead of public transport as it saves time because you can drive and take any route as per your preference. Some people earn which they can only provide for their home but still can’t afford a vehicle although they wish to. Auto loans are preferable as they are safe and reliable. It can be provided by the bank or NBFC (non-banking financial company) to the person who has applied for it but later on when the loan isn’t repaid. The vehicle can be used for it, and the lender (company or a bank) can take the vehicle as collateral until the person (borrower) repays it.
What are the documents required to apply for an auto loan?
Take the following documents when you apply for an auto loan.
- You can take your Aadhar card and pan card as identity proofs.
- Address proof (Electricity bill, credit card statements).
- Last 6-8 months’ bank statements.
- Last two years, I.T.R/form 16 with computation of income (for a self-employed person).
- The last three months’ salary slips are doing government or private jobs.
- 2-4 photographs (recent ones).
Factors affecting auto loans:
- Cibil score: It determines the credibility of a person in the repayment of the loan. Considering the high Cibil score, the chance of getting loan increases. With a lower Cibil score, there are chances that the application will be rejected.
- One’s financial status determines the ability to repay the loan, if your monthly income is stable and higher than the usual, lower would be the interest rate and vice versa.
- Down payment is also a significant factor in determining the financial position. The higher the down payment, the lower would be the interest rate.
What are the documents required while applying for an auto loan?
While applying for an auto loan or any other loan the documentation which is required varies from lender to the other lender. But the basic list of documents required are: Identity proof which means that which person is taking the loan, Address proof to get in touch with the person when there is a need to the lender, salary this is the main stage for the lender to approve the loan to you as if there is higher percentage of salary than required then the loan may be reverted, bank statement that means we are taking the loan in presence of our needs.