Right since the beginning of the decade, buyers have been spoilt for choice when it comes to choosing between which cars to get in their parking lot. Virtually every car manufacturer in India has been on a new model spree, introducing one new car and update after another. Stretching across price and product segments, car manufacturers have been pouring their heart and soul into offering customers high-quality products that would be on par with the rest of the world. The increased availability of financing and rising disposable income have both fuelled this boom of buying a new car in recent years.
Estimates say that over eight in ten shoppers prefer to finance their car purchase in the country. And while they’ll happily choose the car of their dreams, many would say that they’ve struggled to fully understand the financing terms. This is why it is important to understand the basics of buying a car on loan:
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There’s no dearth of sources when it comes to lending money to help people buy their dream car. But deciding upon whom to borrow from is an exercise that’s fraught with some risk of a headache. If you’ve got a preferred lender or are currently servicing a loan, then it would be worth your while to try reaching them when buying a new car.
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You could also keep an eye out for manufacturer-specific lending deals that are declared from time-to-time. Alternately, one could easily get online and look up a loan, for some of the better lending rates these days tend to be offered there. Some lenders will pre-approve your loan even as you’re deciding upon which model to go for.
Whatever you choose, remember that the basics of buying a car on loan is to make sure that you get the lowest rate of interest possible, so choose wisely.
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Lenders love to wrap up proceedings as quickly as possible, once they’re convinced about the genuineness of the borrower. But remember that buying a new car is a matter of great financial responsibility and rushing through the process can sometimes lead to a higher hit to the wallet than necessary.
- Slow down and take your time. Try understanding car financing and how the various terms in your agreement are going to affect you, monetarily or otherwise. Read the fine print, and get every doubt clarified to your satisfaction. If needed, reach out to your financial planner or someone who’s well-versed in financials to come help you out.
Lastly, remember that even the lender is here to run a business. So they’re entitled to make some money for their services. The key is to ensuring that everyone gets a fair deal.
