Even small cars are going to be more expensive with the implementation of GST in India. An expensive car purchase is going to turn more costly for Indian customers in the near future. Everybody wants to keep their car loan smaller to ensure affordable EMIs. How is this going to be possible when there is a big rise in the prices of the cars? To surprise, following few tips will keep your car loan smaller while driving easily on your dream wheels.
Can You Keep Your Car Loan Smaller?
Save big for down payment
The best method to keep your car loan small is to save as much as you can for the down payment. You are supposed to pay a certain percentage of car invoice value as down payment to purchase a car. Most of the lenders demand you to pay 20% of the car invoice value as down payment to get the loan approved. If you can hold your dreams tight for a while and make large down payments, your car loan turns to be small so will be your loan EMI.
Prefer buying the pre-owned car from independent seller
Purchasing a pre-owned car is not a bad idea when want to keep your car loan small. Pre-owned cars are not always popular for bad working conditions. The seller may want to sell it just because he wanted to upgrade to new version. Start hunting for a pre-owned car from your neighbourhood. You may hit the best deal. Hire a mechanic to check the working condition of the car if needed. You will be able a used car at the best deal from the independent seller which helps to keep your car loan small.
Research for the best interest rate
Interest is the key factor that decides the cost of your loan. It is mandated to conduct some research to find the right lender that offer auto loan at best interest rate. Having fetched best interest rate from the lender, the total amount you pay over the tenure of the loan will be low. You will enjoy a good reduction in your monthly payments too and this will make you handle car loan very easily.
Reduce/ increase car loan term
For some keeping the car loan small means keeping the monthly payments low, in that case, you should go with long home loan tenure. If your intention is to clear the car loan in the short term irrespective of the EMI, choose to go with the small term loan.
Go with basic model
If this is your first car and you are looking to keep your car loan small, keep away from all the extra fittings that raise price of the car that raises the prices of the car. These extra features include upgraded stereo systems, reverse-view cameras Bluetooth technology and much more. Staying fix to the basic amities of the car will help you keep your car loan small.