Earlier, automobile buyers had be fully dependant on the loan officer. Thanks to the various options they have these days, the loan agents must compete with each other for our automobile deals. They have the ‘pre-approved loan’ and ‘loan on phone’. Banks yearn for customers. This article will help automobile buyers get the best EMI on the automobile loan.
The automobile finance rates may be high. Yet, the automobile buyer is the one who gains. Negotiation is the best trick that one can play in the game of automobile financing. Brush up on your negotiation skills and you will be amazed at how the rate of interest and automobile loan EMI decrease drastically. If a finance agent tells you that the rate and EMI are fixed, ask for the manager. You never know, the EMI may go down.
Do not forget to do your home work. Use the EMI calculators that are present on most automobile loan web pages. Calculate the EMI for the amount you would need to borrow as auto loan. Compare the EMIs from as lots of Web pages as you can. It is advisable to later lower down the choice to may be two automobile finance agents who offer the lowest rates of interest and the lowest EMIs. Don’t be happy though, that you’ve got the best automobile loan deal. You need to negotiate on those rates of interest. Even very tiny amount saved in margin deposit and interest counts. There's options available for an average Indian to get an auto loan on sensible terms as long as they knows what to ask for and assess what is being sold.
Suppose you take a automobile loan of Rs 1 lakh for a 3-year term and EMI of Rs. 3,331, the amount you would repay at the finish of the three-year tenure would be Rs 1,19,916. The additional sum you would have repaid over the principal is Rs 19,916. On a yearly basis, the same works out to Rs. 6,638 or 6.6 percent a year. This is the flat rate charged by the loan agency.
The reason the rate is so lovely is because it takes for granted the simple interest, which is not appropriate for our EMI based loan. The flat rate is applicable, in the event you are allowed to pay only the interest at the finish of every year for four years and repay the principal after four years.
Most automobile loans come with every month payments in the kind of EMIs that include principal repayment and interest charges. Your principal outstanding decreases every month and the every month interest is calculated on this reducing balance. See to it that you accept the lowest EMI in order to get the best deal. However, do not forget the rate of interest.
Today, automobile finance agents offer loan tenures as long as four years that naturally lower the EMI. However, such automobile loans may not be optimal. You may finish up constantly owing more on your automobile than it’s worth as your automobile is depreciating faster than you’re paying your loan off. You won't even be able to sell off your automobile halfway without losing funds. Then comes the pre-payment penalty . You will be happier thinking about a less pricey automobile than an extended loan.
By: Rashid
The automobile finance rates may be high. Yet, the automobile buyer is the one who gains. Negotiation is the best trick that one can play in the game of automobile financing. Brush up on your negotiation skills and you will be amazed at how the rate of interest and automobile loan EMI decrease drastically. If a finance agent tells you that the rate and EMI are fixed, ask for the manager. You never know, the EMI may go down.
Do not forget to do your home work. Use the EMI calculators that are present on most automobile loan web pages. Calculate the EMI for the amount you would need to borrow as auto loan. Compare the EMIs from as lots of Web pages as you can. It is advisable to later lower down the choice to may be two automobile finance agents who offer the lowest rates of interest and the lowest EMIs. Don’t be happy though, that you’ve got the best automobile loan deal. You need to negotiate on those rates of interest. Even very tiny amount saved in margin deposit and interest counts. There's options available for an average Indian to get an auto loan on sensible terms as long as they knows what to ask for and assess what is being sold.
Suppose you take a automobile loan of Rs 1 lakh for a 3-year term and EMI of Rs. 3,331, the amount you would repay at the finish of the three-year tenure would be Rs 1,19,916. The additional sum you would have repaid over the principal is Rs 19,916. On a yearly basis, the same works out to Rs. 6,638 or 6.6 percent a year. This is the flat rate charged by the loan agency.
The reason the rate is so lovely is because it takes for granted the simple interest, which is not appropriate for our EMI based loan. The flat rate is applicable, in the event you are allowed to pay only the interest at the finish of every year for four years and repay the principal after four years.
Most automobile loans come with every month payments in the kind of EMIs that include principal repayment and interest charges. Your principal outstanding decreases every month and the every month interest is calculated on this reducing balance. See to it that you accept the lowest EMI in order to get the best deal. However, do not forget the rate of interest.
Today, automobile finance agents offer loan tenures as long as four years that naturally lower the EMI. However, such automobile loans may not be optimal. You may finish up constantly owing more on your automobile than it’s worth as your automobile is depreciating faster than you’re paying your loan off. You won't even be able to sell off your automobile halfway without losing funds. Then comes the pre-payment penalty . You will be happier thinking about a less pricey automobile than an extended loan.
By: Rashid
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