owning a car gives you a unique social status. other than the prestige factor, it is a convenient means of transport for you and your family.
you don't need to be wealthy or scrimp and save to buy a car anymore. car loans are available where you can repay the amount in easy monthly instalments called equated monthly instalments (emis).
cars became cheaper in india in early 2020, with the union government reducing goods and services tax (gst) from 28% to 18%, which made buying a car an even more attractive proposition.
most banks have tie-ups with car dealers for setting up loans for customers who approach the dealers to buy cars. once the customer has chosen a model, the bank representative will set up a car loan for the customer.
the customer makes a down payment against the cost of the vehicle, and the bank lends the remaining amount. the rate of interest is fixed (typically 7% or 8%) but the customer can decide on the term (no of years) of the loan.
if you buy a car on loan, you will have to pay a regular emi to pay off the loan over an agreed number of months or years. to know how much emi you have to pay each month, a car loan calculator is the most popular tool. it takes information like the loan amount, the rate of interest, and the loan duration. it uses this information to calculate the emi in a fraction of a second internally.
apart from the emi amount, a car loan calculator also gives you a breakup of the principal and interest amount payable, thus providing the borrowing's total cost. most calculators also provide a graphical representation of these calculations. a car loan eligibility calculator can also check your loan eligibility amount.
to find out more about your probable loan interest cost and your regular emi amount, you can use cred's user-friendly and informative car loan emi calculator.
emi stands for equated monthly instalment. it is the total amount you have to repay against your car loan or any other loan, at a monthly interval. it comprises the principal portion of the loan and the interest charged.
mathematically, a car loan emi is calculated using the formula - p x r x (1+r)^n / [(1+r)^n-1]. here p is the principal loan amount, r is the interest rate, and n is the monthly installments. however, the more straightforward method of calculating it is through an online car loan calculator.
if you want to find out your car loan emi and compare different emi options, use cred’s car loan emi calculator.
using this online calculator is relatively easy, as long as you pay attention to the information you are inputting.
bear in mind that the amounts can be considerable, typically in lakhs, so you should enter the information carefully.
the two single most important numbers are the term and the loan amount. a higher loan amount will increase the emi. the shorter the term, the higher the emi and vice-versa. you can vary the numbers to reach a convenient figure.
be aware that because the source of these calculators is different banks, the interest rates may vary. hence, your results may vary slightly from one calculator to another for the same set of variables.
the car loan emi is calculated using a complex mathematical formula. doing this calculation manually can be a hassle for any person. however, you can use an online car loan calculator to get this answer.
a car loan calculator provides you with the emi amount in a matter of minutes.
these calculators calculate the amounts digitally and are therefore accurate and reliable.
these calculators can be reset easily so you can enter multiple loan options and compare them.
online loan calculators help us in deciding our affordability and monthly budget by providing the exact emi amount.
most calculators also provide graphical representation which provides you with a breakup of the principal and interest portions.
you can also find out the total interest you need to pay during your loan duration.
use the cred car loan emi calculator to find out more about your car loan emi.
you may ask why you need an online emi calculator if the lender is anyway going to do all the calculations.
first off, there is tons of competition between car loan providers. you can get the best deal by trying out the calculators of different lenders. no lender will tell you that they are more expensive than others.
the most crucial benefit that you get from a car loan emi calculator is that it helps you set your expectations about car finance before you even start the process.
there can be a considerable disparity between lenders concerning the interest rates. you can’t change the interest rate of a particular provider, but you can select the provider with the lowest rates.
car loan emi interest rates are primarily of two types, fixed and floating. fixed-rate remains fixed during the loan tenure, while a floating rate may change depending on changes in the financial market. even when you choose one of these two, the interest rate will vary from lender to lender. a car loan calculator gives the exact emi liability, while you can check your eligibility using a car loan eligibility calculator.
the fixed interest rate may be higher than a floating rate, but it has no risk of rate escalation and the borrower can be sure of his exact loan liability. if the financial market is favorable, a floating rate of interest can be a profitable option. it will go up later if the mclr increases.
to know how much emi you have to pay for the offered rate of interest, check the cred car loan eligibility calculator.
the car loan emi that you pay has two components, principal and interest. the amortization schedule outlines how much of your regular emi amount is charged as interest and how much goes towards reducing your principal amount. for the total breakup of principal and interest amount, use the cred car loan calculator.
when you take a vehicle loan, you do so for a particular amount at a specified interest and loan tenure rate. if you wish to pay the remainder of the loan in one go during the loan tenure, you would be prepaying your vehicle loan. use the cred car loan eligibility calculator to check your emi.
to sum up, the car loan emi calculator has multiple advantages as follows:
if you wish to buy a car on loan today, first of all, try out online emi calculators of different loan providers.
keep these calculators accessible to you, and you will be surprised at how helpful they can be in giving you the information you need for your purchase.
1. are there any tax benefits like a home loan?
no. car loans do not have any tax benefits like home loans.
2. is collateral required while applying for a car loan?
you don't need any collateral for your car loan. however, you do need to have the car's registration certificate (rc). the rc endorsed by the bank is later on canceled on the repayment of the loan.
3. how can i know the interest amount?
you can use a car loan calculator for calculating your emi.
4. what is the maximum tenure of a car loan?
the maximum tenure of the car loan is 7 years.
5. what are the documents required?
some mandatory documents are -