A car is no longer a status symbol. It has more or less become a way of life. You must be thinking that this is not true for everyone, as not all can afford a car.
Well, you are right. Most car owners use their car for their daily transport. And why shouldn’t they? Over-crowded public transport, rickshaw and taxi drivers refusing fare are just two times when we wish we could have our own mode of transport.
However, buying a new car is an expensive affair. Ask any of your friends and they will tell you that buying a new car will cause a dent in your pockets. Even car owners who want to buy themselves a newer model or a bigger family car think more than twice when they have to change. So why not buy a used car instead?
Yes, a used car! If you are not among those who are averse to buying a used car, you have hit a jackpot. Now that you are considering buying a used car, your next question must be how you will finance this new purchase.
Well, how about a used car loan?
A few years ago, lenders and bankers would not extend used car loans because they were not confident in the value of the used car. But, today the lenders like Tata Capital take into account the burgeoning used car market and have begun to respect the soundness of the market and its resilience. This is because of the entry of professional used car dealers who have changed the complexion of the used car market with the introduction of pre-owned cars where they certify the used cars with warranties, technical specifications and performance criteria.
Even the reputed automakers have entered the pre-owned car market which has lent credence to the quality of cars. Further, the digital revolution has attracted online used car entities permitting seamless used car sale process that the young car buyers lap up so readily.
Advantages and benefits of used car loan
There are many advantages and benefits of buying a used car in today’s crowded marketplace.
The first advantage is that lenders extend a used car loan or in common parlance a second-hand car loan. The terms and conditions of the loan product are almost similar to new car loans except for a slightly higher interest rate.
The second advantage is that there is a humongous variety. Post the liberalization of the economy in 1991, the auto industry came into its own with all the leading world brands entering India and offering new technology cars. In the early years the gap between technology used in India and the world was large, but now that gap is narrowing and cars in India offer the latest technologies available to the world as well. This augurs well for the used car market as the cars can run for long years without breakdowns or major repairs.
The third advantage is that you get used cars at a huge discount as compared to an equivalent new car. One reason could be that the upwardly mobile youngsters want to change their cars every two or three years because they are enamoured with newer models being introduced by automakers. This bodes well for used cars as these cars have a long running life but highly depreciated in value.
The fourth advantage is that there is intense competition and as you know, competition is good for customers as the sellers make offers that you as a buyer can’t refuse. The competition has ensured that the sellers take the used car buyer seriously and often you are pampered enough to close a sale.
The fifth advantage is used car sellers and lenders offer single window processing of a used car loan because of their tie-up with each other. The whole process of buying a used car is seamless as the lenders and sellers provide all the information on their websites or apps. You can choose the car and make up a shortlist before you inspect the car. You can also check up using the various calculators available such as the used car EMI calculator to help you in your decision. You can iterate for different models of cars of different brands.
The sixth advantage is that lenders such as Tata Capital can offer you used car loans with attractive terms if you have a high credit score and high creditworthiness and past good record of earlier loans. The salient points of the used car loan terms and conditions include
- You can get used car loan up to 90 per cent of the value of a used car
- You can avail a tenure of 5 years for the secondhand car loan that can be extended to 7 years in special cases
- You can opt for an EMI plan that suits your repayment capacity
- Since the loans are at a competitive rate, you can take the secondhand car loan without eating into your savings
- You can hope to secure the loan quickly if you have all the relevant documents on hand
- You can calculate the EMI for your secondhand car loan by using the used car EMI calculator available on the websites.
From the above, it is quite clear that present times are excellent for buying a used car with a used car loan from an NBFC such as Tata Capital.