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Car Loan interest rate
Car Loan interest rates are one of the key factors if you are considering taking a vehicle loan. Car Loans have gained immense popularity in India over the past decade, with a growing trend of people seeking these loans. You can apply for a Car Loan either offline at an Axis Bank branch, or online from the comfort of your house.
You can get up to 100% for the model of your choice, be it a budget-friendly entry-level hatchback, a sedan for your family, an SUV that can take on rugged terrain on your weekend trips or a luxury vehicle to match your financial status.
Government employees often enjoy lower car finance rates based on the loan amount and other criteria. The car interest rates on Car Loans depend on factors such as the loan amount, type of vehicle, your credit history, and more. Use the Car Loan EMI calculator for the interest calculation of your exact monthly outgo of the Car Loan rate. This will help you with rate comparison and financial management.
Car Loan interest rates and Charges
We offer only fixed Car Loan rate which remains constant throughout the loan tenure. It is unaffected by any fluctuations in the financial markets. Fixed interest rates are a go-to choice when one expects financial instability in the market.
| Loan Tenure | 1 Yr MCLR | Spread over MCLR | Effective ROI Range | Reset | Processing Fee | Documentation Charges |
|---|---|---|---|---|---|---|
| Up to 36 months | 8.80% | 0.0%-3.00% | 8.80% - 11.80% | No reset | ₹3,500 - ₹12,000 | ₹700 |
| Above 36 months | - | - | 8.80% - 11.80% | - | ₹3,500 - ₹12,000 | ₹700 |
Car Loan Charges
Car Loan Charges
A New Car Loan is a type of vehicle financing banks offer for purchasing a new car. Banks offer up to 85% of the car's total value under this type of car finance. You can also avail a loan for purchasing an used car, where Axis Bank offers up to 100% of the car's valuation as loan. If you take a car loan, the car acts as collateral, and you need to make regular EMIs to repay the loan within tenure.
In the event of EMI defaults, banks have the right to repossess the car as security. The new car finance interest rates start at 9.3% and the loan processing fee can range between ₹3500 and ₹12000 with a Car Loan stamp duty charge of ₹700. For used car loan, the rates start at 12.95% and loan processing fee is 1% of loan amount + GST as applicable.
Banks have streamlined the entire Car Loan application process for your convenience. From application to approval and disbursement, everything can now be done online, eliminating the need for physical visits to banks.
| Sr. no | Type | Charges |
|---|---|---|
| 1 | Cheque/ECS/NACH Bounce / Instrument Return Charges | ₹339 per instance |
| 2 | Cheque / Instrument Swap Charges | ₹500 per instance |
| 3 | Duplicate Statement Issuance Charges | ₹250 per instance |
| 4 | Duplicate Repayment Schedule Issuance Charges | ₹250 per instance |
| 5 | Penal Charges | ^Financial Default: 8% per annum above applicable interest rate on the overdue amount (subject to the aggregate not exceeding 24% per instance) |
| 6 | # Loan Cancellation/ Re-booking | ₹550/- per case |
| 7 | Foreclosure/Part Payment Closure | 5% of the Principal Outstanding |
| 8 | Stamp Duty | At actuals |
| 9 | Issuance of Credit Report | ₹50/- per instance |
| 10 | Documentation Charge | ₹700/- |
| 11 | Registration Certification Collection Charge | ₹250/ per instance |
*Goods and Services tax (GST) will be charged extra as per the applicable rates, on all the charges and fees (wherever GST is applicable).
^Financial Default includes all types of payment or financial defaults/irregularities with respect to your Loan Account. There shall be no capitalisation of Penal Charges.
Pre-Payment charges are not applicable for fixed rate loans up to ₹50 lakhs to Micro and Small Enterprise (MSE)
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Factors that can influence your Auto Loan interest rate
Loan tenure
The duration of your loan term is directly related to the interest rate you will be offered.
Read MoreRelationship with the bank
Having an established, long-term relationship with the bank can work in your favour when applying for a Car Loan.
Read MoreEmployment status
Working for a well-established and reputable company can enhance your chances of securing a favourable Car Loan interest rate.
Read MoreDown payment
Making a substantial down payment can help you to negotiate a lower interest rate.
Read More
Income
Higher earnings suggest a better ability to repay the loan promptly. If you have a substantial income, you can secure more favourable lending rates from banks. Banks offer loans to salaried as well as self-employed individuals.
Loan tenure
The duration of your loan term is directly related to the interest rate you will be offered. Longer loan terms tend to come with higher interest rates and pose a higher risk to the banks. Hence, selecting the loan term is a key criterion for meeting your repayment capabilities.
Relationship with the bank
Having an established, long-term relationship with the bank can work in your favour when applying for a Car Loan. Banks can easily assess your credit history and recent financial transactions, and confirm your financial stability if you are an existing customer.
Employment status
Working for a well-established and reputable company can enhance your chances of securing a favourable Car Loan interest rate. Some banks maintain lists of approved employers and businesses you can trust when granting loans.
Down payment
Making a substantial down payment can help you to negotiate a lower interest rate. While banks may offer loans covering up to 100% of the vehicle's ex-showroom price, a larger down payment reduces the loan amount and enhances your repayment potential.
Here's a breakdown of the application process:
- 01
Fill out an application form with your details and register yourself online.
- 02
After you submit your application, you'll need to upload the required documents as specified by the bank
- 03
Following the document verification and depending on your ability to repay, the loan is generally sanctioned within two days.
- 04
Once approved, the bank releases the loan funds, which typically cover a portion of the car's purchase price.
- 05
The new car interest rates on your vehicle loan can vary depending on your situation.
Car Loan EMI Calculator
Total Amount Payable
1,03,832
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Track NowFrequently Asked Questions
Before obtaining a car loan, you can enquire about the automobile interest rates (fixed or floating) banks charge and select the one that aligns with your preferences.
With a fixed interest rate, your interest payments remain consistent throughout the loan tenure. Floating rates mean your interest payments can fluctuate based on changes in interest rates. Choosing a fixed interest rate is advisable if you expect future interest rates to increase and prefer a stable payment structure.
The interest rate on a Car Loan is generally not directly tied to the type of car but may be influenced by the car's cost. It is at the lender's discretion to decide the interest rate for the Car Loan.
If you make a big down payment, it reduces the amount you need to borrow for the Car Loan. Since your loan amount will be lower, your interest repayment will be lower over the entire tenure of the loan.
If you have a strong credit score, a higher income, and a good rapport with the bank, you can try to negotiate for lower Auto Loan interest rates on your Car Loan. However, it is up to the bank to decide if you can get a loan at a lower interest rate.
While the specific type of car does not directly influence the car finance rates, the car’s price can play a significant role. More expensive cars often require larger loan amounts, which lenders might consider risky, leading to slightly higher new car interest rates.
No, prepaying a loan does not lower your interest rate. However, it can significantly reduce the tidal interest you pay over the loan term. By prepaying, you reduce the principal amount, which leads to lower interest charges in the following EMIs.
Choosing between a fixed and floating Car Loan depends on your financial outlook and risk tolerance. A fixed Car Loan rate provides certainty and ensures consistent EMIs. On the other hand, a floating Car Loan rate offers potential savings if interest rates decrease.
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