(SBI Car Loan Features Explained)
State Bank of India (SBI) is one of the largest public sector banks in India and offers a wide range of banking products and services including car loans. SBI Car Loan is a popular financing option for individuals looking to buy a car. In this blog, we will discuss everything you need to know about SBI car loan, including its features, eligibility criteria and application process.
Features of SBI Car Loan:
SBI car loan comes with several features that make it an attractive financing option for car buyers. Here are some of the key features of SBI car loan:
- Loan Amount: SBI Car Loan offers finance up to 90% of the on-road price of the car, with a maximum loan amount of Rs. 2.5 crores.
- Repayment tenure: The repayment tenure of SBI car loan can range from 12 months to 84 months, depending on the loan amount and repayment capacity of the borrower.
- Interest rate: The interest rate on SBI car loan is competitive and varies depending on the credit score of the borrower, loan amount and repayment tenure. The current interest rate is 7.50% to 9.50% per annum.
- Processing Fee: SBI charges a processing fee of up to Rs. 10,000 for your car loan, depending on the loan amount.
- Prepayment Charges: SBI Car Loan has a prepayment penalty of 2% of the outstanding loan amount for prepayment within the first year of the loan tenure. After the first year, there is no prepayment fee.
- Collateral: SBI car loan is a secured loan, and the car purchased using the loan amount acts as collateral.
- Insurance: SBI car loan requires the borrower to buy a comprehensive insurance policy for the car, which covers damage, theft and third party liability.
Eligibility Criteria for SBI Car Loan:
SBI Car Loan has specific eligibility criteria that a borrower must fulfill in order to be eligible for the loan. Here are the eligibility criteria for SBI car loan:
- Age: The age of the borrower should be between 21 years to 65 years.
- Income: The minimum net annual income of the borrower should be Rs. 3 lakhs.
- Employment: The borrower should have a stable job or business with at least two years of work experience.
- Credit score: The borrower must have a good credit score of at least 700 to be eligible for an SBI car loan.
- Documentation: To apply for an SBI car loan, the borrower must have all the necessary documents such as ID proof, income proof and address proof.
Application Process for SBI Car Loan:
The application process for SBI car loan is straightforward and can be done online or offline. Here is a step-by-step guide to apply for SBI car loan:
- Check Eligibility: The first step is to check your eligibility for SBI Car Loan. You can do this by visiting the SBI website or by visiting an SBI branch.
- Select a car: Once you are eligible for an SBI car loan, you can choose the car you wish to buy.
- Calculate EMI: You can use SBI’s car loan EMI calculator to calculate the Equated Monthly Installment (EMI) to be paid based on the loan amount, interest rate and payment tenure.
- Apply Online: You can apply for SBI car loan online by visiting the SBI website and filling up the application form. You will need to upload the required documents and provide details about the car you want to buy.
- Apply Offline: You can also apply for SBI car loan offline by visiting an SBI branch and filling up the application
Documents required for SBI Car Loan:
To apply for an SBI car loan, you need to submit the following documents:
- Identity Proof: Aadhar Card, Passport, PAN Card, Driving License, Voter ID Card.
- Address Proof: Aadhar Card, Passport, Utility Bill, Rent Agreement, Bank Statement.
- Income Proof: Salary Slip, Income Tax Return, Bank Statement, Form 16.
- Car related documents: Quotation of the car, Proforma Invoice, Insurance Policy, Registration Certificate.
- Passport size photo.
- Loan Disbursement Process:
Once your loan application is approved, SBI will disburse the loan amount directly to the car dealer or seller. You need to provide dealer details and car details to SBI to initiate the disbursement process.
Repayment of SBI Car Loan:
SBI Car Loan is repaid through EMIs. The EMI amount will be calculated based on the loan amount, interest rate and repayment tenure. You will be required to pay the EMI on a monthly basis till the loan is fully repaid.
SBI offers various modes of repayment, such as online payment through ECS, auto-debit, post-dated checks and net banking.
Benefits of SBI Car Loan:
Here are some of the benefits of SBI Car Loan:
- Competitive interest rates: SBI car loans offer competitive interest rates, making it an affordable financing option for car buyers.
- Flexible Repayment Tenure: SBI Car Loan offers flexible repayment tenure of up to 84 months, giving borrowers ample time to repay the loan.
- Easy Application Process: The application process for SBI car loan is straightforward and can be done online or offline.
- Higher Loan Amount: SBI Car Loan offers financing of up to 90% of the on-road price of the car, with a maximum loan amount of Rs. 2.5 crores.
- Collateral: SBI car loan is a secured loan, and the car purchased using the loan amount acts as collateral, which means you do not need to provide any additional collateral.
SBI Car Loan is a popular financing option for individuals looking to buy a car. It offers a competitive interest rate, flexible repayment tenure and higher loan amount, making it an attractive option for car buyers. However, it is important to check your eligibility and understand the terms and conditions before applying for an SBI car loan.
Here are the Frequently Asked Questions (FAQs) about SBI Car Loan:
What is the eligibility criteria for SBI Car Loan?
The eligibility criteria for SBI Car Loan varies based on factors such as age, income, credit score and employment status. Generally, individuals in the age group of 21 to 65 years have a minimum monthly income of Rs. 20,000 and a good credit score are eligible to apply for an SBI car loan.
What is the loan amount that can be availed through SBI Car Loan?
SBI Car Loan offers financing of up to 90% of the on-road price of the car, with a maximum loan amount of Rs. 2.5 crores.
What is the repayment tenure for SBI Car Loan?
The repayment tenure of SBI Car Loan can range from 12 months to 84 months depending on the loan amount and borrower’s preference.
What is the interest rate for SBI Car Loan?
The interest rate for SBI car loan varies depending on the loan amount, repayment tenure and credit score of the borrower. Generally, the interest rate for SBI car loan starts from 7.5% per annum.
Is collateral required for SBI Car Loan?
Yes, SBI car loan is a secured loan, and the car purchased using the loan amount acts as collateral. This means that if the borrower defaults on the loan, SBI has the right to repossess the car to recover the outstanding loan amount.
Can I prepay my SBI Car Loan?
Yes, you can prepay your SBI car loan without any prepayment penalty. However, it is important to check the terms and conditions of the loan agreement to understand the prepayment policies.
Can I apply for SBI Car Loan online?
Yes, SBI provides an online application process for car loan. You can visit SBI’s website, fill the application form and upload the required documents to apply for SBI car loan online.
How long does SBI car loan approval take?
Depending on the completeness of the documentation and the creditworthiness of the borrower, the approval process for SBI car loan may take a few hours to a few days.
What if I default on my SBI Car Loan?
If you default on your SBI car loan, the bank can initiate recovery proceedings, which may include legal action or repossessing the car. To avoid any such situation it is important to ensure that you pay the EMIs on time.
Can I transfer my existing car loan to SBI?
Yes, you can transfer your existing car loan to SBI through the balance transfer facility. SBI offers attractive interest rates and flexible repayment options for balance transfers, making it an attractive option for borrowers looking to lower their EMIs or avail better terms and conditions.