Four Crucial Facts You Need To Know If You Wish To Open A PPF Account

Every year, billions of Indians pay millions of rupees in taxes. Anyone who earns an annual income exceeding ₹250,000 is required to pay taxes by law. While paying taxes is mandatory, the Government of India also offers various schemes through which taxpayers can create huge saving and also get some respite in the form of tax deductions and exemptions. One such scheme that enables all Indian citizens to invest and avail tax exemptions is the Public Provident Fund or PPF scheme. Here are four crucial facts you need to know if you wish to invest in this scheme.

Eligibility – inclusions and exclusions

To be eligible for PPF, you need to be a resident Indian citizen. You can be a self-employed individual or a salaried professional to open your account. While any individual can open this account, members of Hindu Undivided Families (HUFs) and Non-Resident Indians (NRIs) are not permitted to open a PPF account. That said, if you open the account and assume NRI status later in life, you may continue parking your funds in this savings scheme.

Scheme duration and annual investments permitted

The scheme comes with a 15 year lock-in period. However, you can extend the scheme is indefinite slots of 5 years after completing the initial lock-in period. You may invest a maximum of ₹150,000 per annum in the scheme, irrespective of whether you choose to invest the sum as a lump sum or in investments. However, you cannot exceed 12 installments in a year. Also, to keep the account active, you are required to invest at least ₹500, once a year. If you are an NRI PPF account holder, you can invest a maximum of ₹70,000 per annum.

PPF account opening details

Opening your account under the Public Provident Fund scheme is rather easy. You can do it offline, through your preferred bank. A bank representative can assist you with the account opening process. If you are comfortable with using internet banking, you can also open PPF account online through your bank’s net banking portal. You need to fill the account opening form, link your PAN and Aadhaar details and submit it on the link specified in the account opening form. Note that you can only one account under this scheme.

Tax implications

The PPF scheme offers some of the best tax benefits when compared to any long-term savings scheme in India. You can avail tax deductions of ₹150,000 (i.e. the maximum tax-free amount permitted) per annum. Furthermore, the entire investment is categorized as an EEE investment, which means you are not required to pay any taxes on the sums deposited, the interest earned on deposits and the final amount at maturity.

Final word: The PPF scheme is an ideal form of investment for conventional investors with low-risk appetites. It offers assured returns with decent interest rates. Also, since the Government of India backs the scheme, it is regarded as an incredibly safe scheme.

A brief guide about two-wheeler loan

To purchase a two-wheeler is a fresh air of freedom, for many reasons.

The first college bike or scooter means to be independent; it is the beginning of a youthful romance for others. It is their lifeline, for some Indians. A motorcycle means freedom for the homemaker. It helps her to drop her kids to school but also to do errands and take care of her daily life. To others, this is the quickest form of transportation to their place of work.

A two-wheeler in rural areas is not only about a mode of transport but also about greater financial independence. A small-town building contractor may fly to his faraway ventures, and during an emergency, a village doctor can travel faster to remote areas.

A two-wheeler is like a blessing with the traffic-related tension in the city ride. You can go out with your loved one to buy groceries, pay a quick visit to the ATM or go with your loved one on a short road trip. A two-wheeler can meet several purposes and make life easier. Here are some advantages of owning a two-wheeler:

Easy to move in traffic as compared to cars

Gives superior mileage

Causes less pollution

Maintenance is lower

Good resale price

Inexpensive

Can easily be parked

If you need to purchase a bike, you may need funding. That means applying for a loan from a financial institution or bank for most people in India as this is the easiest way to secure a two-wheeler loan to buy the bike. The main reason why most customers favour bike loan, it is not difficult to avail one. Compared with other investments, a bike loan is easier to apply for, offer competitive interest rates, special offers for women, easy paperwork and flexible tenures.

There are quite a few questions that will come into your mind when you consider for the first time funding a two-wheeler. Do you apply for two wheeler loan? How much, if so?

There will be a list of queries, so let's get started on some beneficial information that will clear all your questions regarding a bike loan.

Fee and charges: Some banks charge a one-time processing fee and have some extra fees to cover the administrative costs here and there.

Promised rate of interest: This is where your credit record and other factors come into the picture. If you have a decent credit score, make sure you go for a tough bargain by making interest rate comparisons.

Plan benefits: Are there any designed advantages of selecting this bank over another? Does the bank give you a lower interest rate for existing customers? Is there an additional benefit of choosing one lender over the other?

Processing time: Check out the completion time for the two-wheeler loan. Shorter the time, it is better for you.

Other offers: Purchasing it during the festival season. Many offer deals and discounts such as giving a gold coin or an opportunity to win a vacation or get free insurance.

Prepayment advantages: Is prepayment permitted, and is there a limit to the amount?

How does a Fixed deposit calculator work?

Have you invested in a fixed deposit? Are you now struggling to know the final amount you will receive when your FD matures? Well, the calculation of the maturity value of the FD was daunting when we did not have a tool called the fixed deposit calculator.

A fixed deposit calculator or FD calculator can quickly and accurately calculate the maturity amount of your FD. You can use the calculator to know the amount of interest you can earn on an FD.

How does it work?

FD calculator is user-friendly and uses formula instead of manual calculations. You can find the FD calculator all over the internet. You just need to mention the basic things such as the deposit term, the type of fixed deposit, the investment amount, and the rate of interest. The FD calculator will instantly calculate the value you will get at the time of maturity. The cost of the investment also depends on the interest compounding frequency, whether it is monthly, quarterly, half-yearly, or annually.

Deposits can be of two types. The first is the periodic interest payout where a fixed interest is received at the end of every period, and the interest remains the same all through the FD period. Second is the cumulative deposit, where the compound interest concept applies.

FD calculator can calculate both the simple interest and compound interest on the FD amount. The initial FD amount is computed using simple interest, but the original amount and subsequent interest are calculated using compound interest. The FD calculator can also calculate the interest earned along with the total amount that the FD holder will receive at the time of the maturity.

To calculate the maturity amount, you need to know the following:

Deposit amount, which is the amount you invested in a fixed deposit scheme

Deposit tenure is the time for which the amount is invested in FD

Deposit interest rate, which is the rate of return you earn

Once you enter these details in the FD calculator, you need to click on ‘Calculate’. Then, you will get the result.

You save your time, calculation effort, and money too. You can also compare different fixed deposits schemes offered by the various bank and companies to know which FD scheme is fetching you the maximum returns. This way, you can plan your investments in a better way.

You must use the Compound Interest Calculator to calculate the maturity amount. It needs the details such as the deposit amount, deposit period, the interest rate of the FD scheme, and the compounding frequency. Because if you use the simple interest calculator, the interest will be calculated only on the initial deposit amount. In the Compound Interest method, interest is calculated on both the principal and the interest earned consequently.

What is Pradhan Mantri Jeevan Jyoti Bima Yojana scheme?

It is easy for the middle class and a vibrant section of the society to buy a life insurance policy. But what about the poor and oppressed people of the country? They find it challenging to feed themselves and their family; buying insurance for them is a far-fetched dream. The government has realized their problem and has come up with a solution.

The launch

PMJJBY is a scheme launched by the government that offers Life insurance schemes to the people of India. It was first mentioned by the Finance Minister Mr Arun Jaitley in February 2015 in his budget speech. On May 9, it was formally started by the Prime Minister of the country, Mr Narendra Modi.

Who can sign-up for Pradhan Mantri Jeevan Jyoti Bima Yojana?

Pradhan Mantri Jeevan Jyoti Bima Yojana can be taken by the people who are aged between 18 years to 50 years. The people must have bank accounts.

What is PMJJBY?

PMJJBY is an insurance scheme that requires you to pay an annual premium of only INR 330. This amount exempts the GST. In an unfortunate event of the death of the nominee, the nominee’s family will receive an amount of INR 2 lakh. The life coverage of this amount will be available for the period of one year starting from June 1 to May 31. It is a renewable policy.

The people who have taken the PMJJBY policy need to self-pay the premium amount. This amount in the automatic-debit mode, where the premium will be automatically deducted from the account of the nominee. This scheme is linked to the bank accounts that were created for the Pradhan Mantri Jan Dhan Yojana scheme. The account need not have a minimum balance as it is a zero-balance account initially. The auto-debit will happen between the dates May 25 and May 31; the debit will not occur if the customer has requested to the bank for the cancellation of this policy.

The account holders can use this facility by activating their net-banking facility. For this, they need to fill a form and deposit at one of the branches of the bank at any time.

It was found in 2015, that only 20 per cent of the people in the country had any type of insurance. Until last year March 2019, around six crore people enrolled for this scheme, where around 1.3 people have already claimed for it, and an amount of INR 2,700 crore has already been disbursed.

Aadhar card is a necessary KYC document to open the bank account. The scheme is offered by LIC or Life Insurance Corporation and many other life insurers.

The features and benefits of a home improvement loan

Home furnishing and renovation is an art that requires lots of innovative ideas, creativity, and monetary support. Without money, things cannot be purchased, let alone basic requirements. Many people love decorating and painting their houses to make it look lively. Modern techniques and methods have been introduced to home décor programs, and people love to explore and use them to make their interiors look stylish.

Home renovation requires lots of money and effort, along with innovation and design. Some of the expenses would be hard to bear, hence leaving the person to compromise on ideas. Thus, banks introduced a scheme of providing a home renovation loan to all those individuals fond of decorating their houses, without spending too much money. These loans have helped consumers customise their homes at their own will without worrying about hurting their desires.

Features and benefits

Loans that are designed for consumers to refurbish their homes offer a variety of features and benefits that make it easier for them to manage their expenses. 

Some of the features and benefits are as follows:

Many banks offer a choice of interest rates, like fixed and floating, for the loan applicant to choose the method of calculation of the rate of interest.

There can be combos of fixed and floating interest rates. The first few years of the loan tenure will have a fixed interest rate, and the remaining period will have a floating interest rate.

Banks have websites and online portals for users to access and apply for loans. It saves time.

The loan amount can be paid in instalments or all at once.

Some banks may also offer credit cards on applying for a loan.

A home improvement loan requires minimum documentation depending on the bank.

Documents to be submitted

Every bank requires documents to process loans. This procedure is incomplete if the loan applicant does not provide them on time or misses out on some of them. 

The list of standard documents for house renovation loan are:

Loan application form with passport size photographs

Form 16 and latest salary slips

Bank statements of the previous six months

IT return documents

Original property papers and deeds

The estimated cost of renovation mentioned in the quotation by the architect

Address proof and KYC documents like Aadhaar Card, Driving License, Passport, etc.

These are the documents that are commonly asked for proof by the bank for a home renovation loan. There may be more documents apart from the ones mentioned above. Banks have the liberty to ask for more evidence as the verification process varies between banks.

Things to be aware of before taking a car loan

Before deciding a car model and pay a visit the car dealer to bring home your chosen car, you should spend some time on researching some figures and prepare a set of questions if you want to opt for a car loan. It is always a good idea to make sensible financial choices. It is smart for you to study and find the right option for a car loan with the lowest interest rate and the minimum processing cost. By putting in some time in researching can help you in saving more on your car loan. Before you take a car loan, let us go over some stuff you should be aware of.

Know the interest rate

The first and foremost question you should ask about a car loan would be the rate of interest you will pay the bank on your investment. Many banks have low-interest rates for vehicle loans. Lenders usually issue loans with an established lender partnership at slightly lower interest rates.

The amount being funded by the bank

It is always better to invest about 20 per cent of the value of your car on your own and get the remainder from the bank. Many banks, however, offer loans up to 100 per cent of the car's ex-showroom price. Applicants will seek to obey the 20 per cent rule that allows them not to take out a loan that will take up more than 20 per cent of their monthly EMI income. You'll pay a higher EMI amount each month, putting a strain on your finances.

Final price of the car

Also, at low-interest rates, some lenders charge borrowers with high processing fees, reporting fees, prepaid fees, foreclosure and late fees, payment default etc. This heightens the overall amount charged for the car. By using the car loan EMI calculator, the borrower can check the total amount he will have to pay over the period. You should verify the various aspects such as the total loan amount and loan term to get the lowest interest and save on your EMI amount.

Down payment amount and loan tenure

Applicants should know and understand that their auto loan will be around for some time in their lives, and they will have to pay a fixed amount periodically over the years in the form of EMI every month. The key here is Smart Financial Planning. Applicants should not commit a higher EMI sum which could place them on their budget under tremendous financial pressure to keep the term small and save on interest. They should also avoid choosing the longest term because the interest due on the loan amount would increase. You should pick a healthy EMI with a fair tenure that does not put undue pressure on earnings. To calculate interest and EMI, it is advisable to use a car loan EMI.

Fees included in the car loan

A borrower must pay a range of charges and taxes, aside from the interest rate, on the car financing. You will also check about the loan-related charges when the loan is accepted as well as when the debt is paid off. Some of the customer's most common fees are mortgage and paperwork fees, credit report fees, registration certificate collection fees, stamp duty, prepaid portion fees, default and late payment fees, amortisation plan fees, cancellation fees, swap charges, bounce fees, etc. Before choosing your lender, you can compare the extra charges from different banks.

Things to know before opening a bank account

Are you all set to open your bank account? So, before you head to the bank, it is good to know some essential things beforehand. A right amount of knowledge and research will always help and make you more enlightened. Here, we provide you with a few insights before you go to open an account.

Things to know before opening a bank account

Decide the amount you want to put in the account

The first and the most crucial step is to assess the amount of money you can afford to open your bank account with. The banks need a minimum account balance if it is not a zero-balance account, and you need to maintain it. If you do not comply with it, the bank may charge you a penalty and start deducting from your account.

Know the charges and penalties

Another essential thing to be wary of is the charges or fee and penalties. Many banks implement different kinds of fees and penalties, which people think is for free. Sometimes the banks offer a few services for free, but just for the promotional period. Some people keep using those services later, too without knowing that it is being charged. So, save yourself aware by researching and reading the terms and conditions. You can also ask these questions to the bank executive before opening the account.

Know your nearest branch and ATM

It is good to have your bank’s branch and ATM nearby. Though the banks have now been ensuring that there is an ATM in every locality, it is always better to check these things beforehand to avoid any trouble and disappointment later. If the ATM is not available in your vicinity, but it is there at the place where you frequently travel, then you are good to go!

Keep the money with you

As you go to open account in a bank, you need to keep the money with you either in cash or a check. The banks may also ask you to pay for their services such as debit card fee, internet facility fee, and any other service charges for some bank accounts. Though many banks have started to offer these services for free, to attract more people and make the deal lucrative. But it will be better for you if you carry some extra money with you.

Online facility

Do ensure that your bank provides you with the internet and mobile banking facility. Online banking has become increasingly popular today, considering the benefits it offers. You can access your bank account, do online account opening, know your balance, do a transaction, pay your bill, recharge your phone, and do several other things in a niche of a second, using your mobile home. Isn’t this extremely convenient?

Business Loan Vs Mudra Loan

Mudra means Micro Units Development and Refinance Agency Ltd. Mudra means Agency for Production and Refinance of Micro Units Ltd. Introduced in 2015 under the Pradhan Mantri Mudra Loan, it aims to provide financial assistance to small, new, and emerging enterprises.

It also has other small enterprise growth programs. Support is the key, however.

A business loan is nothing but a credit product which NBFCs and banks provide. It is intended to assist business people in fulfilling their business needs, growth plans, capital expenditure etc. 

Business people are responsible for repaying the loan with interest as per the loan terms.

Key difference Between Mudra Loan and Business Loan

Interest rate is the primary factor which a borrower takes into consideration when applying for any form of a loan.

The interest rate for Mudra loan schemes is based on the bank you are applying for your loan from. It usually starts at 8 per cent.

There is a thriving market for business loans with plenty of buyers and a lot of sellers. Hence, sellers have become very competitive, especially with interest rates. To attract more and more business people, NBFCs are trying to provide business loans at low prices possible.

Eligibility

1. The eligibility for Mudra loans under Pradhan Mantri Mudra Yojana provide loans to the following business owners and purposes:
2. Shopkeepers, traders, vendors and service sector allied business owners
3. Equipment for micro-units
4. Agri-related non-farm activities
5. Financing for certain commercial vehicles, tractors and tillers
6. At the other hand, business loans are much more welcoming in that respect. The qualifying requirements are generally as follows:
7. Business record (minimum two years)
8. Previous year's ITR (minimum INR 1.5 lakhs)
9. Minimum turnover of INR 5 lakhs
10. Place of business and house have to be different
11. Owner of business should own either a home or a business place

Documents Required:

1. As you would expect, a Mudra loan needs much more paperwork than a business loan. Here's a rundown of the required documents to get one.
2. Two passport size photographs
3. Your id proof (Passport, PAN card, voter ID, driving license, or Aadhaar card)
4. Business address proof
5. If business premises are rented, a rent agreement for the same
6. Your address proof (telephone bill, latest electricity bill, passport, Aadhaar card, voter id, etc.)
7. Id proof of your business establishment
8. SSI registration certificate
9. Memorandum of Association and Articles of Association (in case of a company)
10. Partnership deed (in case of partnership businesses)

If the loan is for an amount more than INR 2 lakh, the following additional documents are also required

1. Audited balance sheet of last two years along with income tax and sales tax
2. Pollution board's clearance certificate
3. If you do not want to tackle this exhaustive list, you can always apply for a company loan. You will need limited papers, the majority of which will contain the following:
4. Business address proof
5. PAN Card
6. Previous two years' ITR
7. Previous nine months' bank statement

Important Information Regarding Opening Sukanaya Samriddhi Yojana Account

For centuries, the girl child was regarded as a burden in India. Every government in power has tried to make strides to afford girls equal opportunities as those provided to men in society. The government has run several campaigns to change the mind-set of parents, encouraging them to invest in their daughters’ future. One such campaign launched by the Government was the ‘Beti Bachao Beti Padhao’ campaign. Shortly after the campaign, the government also launched the Sukanya Samriddhi Yojana – a Government-backed scheme through which parents of the girl child can afford their daughters a sense of financial independence. Here’s some important information regarding this scheme.

Getting and filing the account opening form

To avail benefits from the Sukanya Scheme, parents and guardians of the girl child need to open an account under the scheme. Parents/guardians need to fill a Sukanya Samriddhi Account form also known as the SSA-1 Form. They can avail the same from their nearest post office or participating banks or even apply for Sukanya Samriddhi Yojana Online through the bank’s internet banking portal. The SSA-1 Form is a simple form in which they must provide some necessary details such as the name of the girl child, her date of birth, and age, along with their own information. 

Parents/guardians must also complete the KYC process. Note that the girl child should be named as the primary account holder.

Documents required

Along with the duly filled SSA-1 form, parents/guardians must also attach a few, mandatory documents while applying for the Sukanya Samriddhi Scheme. 

They are as under:

The birth certificate of the girl child (the primary beneficiary)

The identity proof documents of the parent/ guardian (PAN, Passport, Aadhaar, Voter’s ID, driving license)

The Address proof documents of the parent/guardian (Passport, Aadhaar, Voter’s ID, driving license, bank passbook with photo attested, utility bills)

The instrument or mode of payment (cheque, cash or bank account details) along with an initial contribution of ₹250 or more

Passbook and annual contributions

Once the bank or post office, verifies the documents, the SSY account will be opened. Beneficiaries will be provided with a passbook in which they can regularly update, to track the sums deposited in the account. To keep the account active, parents/guardians must deposit at least ₹250 per annum. The maximum contribution allowed per annum under this scheme is ₹150,000.

Operating the account

Parents/guardians of the account holder are permitted to operate the account on behalf of the girl child until she turns 18 years old. However, they may only deposit sums into the Sukanya Samriddhi Yojana Account. Only the girl child is allowed to withdraw amounts from the account. Parents can operate the account online through net banking or through the Post Office’s IPPB Mobile banking Application.

The SSY scheme is indeed a boon for parents wishing to afford financial independence to their daughters. The scheme offers beneficiaries interest rates of 8% and higher, making it one of the highest interest-paying schemes in India.

Personal Factors Considered By Lenders While Checking Personal Loan Applications

In the modern age, the wants and needs of people are increasing tremendously. All of us wish to buy the latest products and keep up with the trends. But following a trend can be rather expensive and may cost a lot of money. However, banks and NBFCs offer personal loans, which enable you to purchase almost anything. That said, lenders typically consider several factors before approving your loan. They check your personal loan eligibility based on several factors, which are as under.

You age during the loan application time

Lenders need to ensure that you can repay the loan and your age helps them determine your eligibility for personal loan. It is rather obvious, that older (retired) person, with limited income sources, may find it challenging to repay the loan, thus increasing the lender’s liability. As such, lenders prefer providing loans to younger people, with several years of employment ahead of them. Generally, the minimum and maximum age for availing and repaying loans is 21 years and 70 years respectively (at the time of final EMI repayment).

Your net monthly income and additional income sources

Your income is another factor that helps lenders understand if you can indeed repay the loan. Every lender sets certain basic minimum monthly income criteria to determine if you are eligible for the loan. You can show both your monthly income and your additional income sources (if any) to increase your eligibility for personal loan. 

Your employment status

Your employment status is perhaps the most crucial factor that lenders consider while determining whether or not to approve your personal loan application. If you have been steadily employed, for more than two to three years, your loan approval chances can increase to a great extent. Also, the lender considers if you are salaried individuals or self-employed professionals. The chances of the former’s loans getting approved are higher than the latter.

The reputation of the organisation you are employed with

In the loan application form, the lender asks you to fill the details of the company or organisation with which you are employed. Your employers’ reputation plays a significant role in getting your loan approved. If you are employed with a reputable company, your personal loan eligibility can increase, and your loan may be sanctioned within minutes.

The way you handle your finances

Apart from the above mentioned personal factors, lenders also check how you manage your finances. They check if you have existing loans and whether they are repaid on time. They monitor your credit card bills and your credit utilisation ratios. If these figures are up to the mark, (and if your credit score is over 750), your loan may be approved quickly.

Before applying for a loan, you must check if you are eligible. Remember to use a personal loan eligibility calculator found on all lender websites. This simple tool, along with the EMI calculator, can help you prepare for the loan before you even apply.

How is home loan eligibility calculated?

Thousands of people apply for home loans every year. Some of them apply for loans with banks which already have their accounts, whereas others go in search of banks and choose the desired one. The internet has made banking and banking services reach an extensive range of people, right from the smallest of towns to the biggest of metropolitan cities. It makes it easier for people to compare different schemes given by different lenders and banks.

There are many methods to check the availability of home loans based on the eligibility of the loan borrower. One of the most reliable means to check home loan eligibility is by using eligibility calculators. These calculators are available on all banking and insurance websites and solve many other purposes. Most of the eligibility criteria details are mentioned on sites so that customers don’t waste their valuable time searching online.

Some essential factors considered in home eligibility calculation are as follows:

Age

The age of the person at the time of borrowing the loan plays a vital role in deciding the loan amount. Loan tenures differ from salaried persons to others.  A salaried person’s age of retirement is of 60 years as compared to others, i.e., 70 years. It is wiser to take loans at an earlier stage of life so that there is a lesser burden towards retirement.

Salary

Working professionals should meet the salary criteria as well. The loan amount is decided based on the applicant’s earnings. There can be cases where high-income earners don’t get loans because of lower disposable income and ratio between the EMI obtained and the salary earned.

High levels of debt

The loan application gets rejected in cases where the applicant has high levels of debt of previous loans. Similarly, if the applicant is already a guarantor for one credit, there are possibilities that the other person may not pay the dues and blame them on the applicant.

A home loan eligibility calculator helps the loan borrower determine the rate of interest, the loan amount, the loan tenure, and most importantly, the eligibility for applying for the loan. It is beneficial to know that banks finance about 80 per cent to 90 per cent of the investment because house sellers and construction workers take time to construct new projects.

Top-up loan offers are also available for those who have already met the home loan eligibility criteria. Still, they have to complete six months before applying for a top-up loan.

Conclusion

Many people interested in opting for home loans have many confusions about their eligibility and finance to repay the loan amount. A home loan eligibility calculator helps them reduce uncertainty and choose a plan that suits them best.

What do you require for a car loan

While it's easy to take advantage of a car loan once you've agreed on the car you want to purchase, you must understand all the criteria in detail. You would need to submit proper documents precisely as requested by the lender and be prepared for additional requirements including credit score, down payment, etc. Here's a definite rundown of documents required for car loan –

Documents mandatory for availing a car loan

Income proof

Many lenders would first review the earnings and assess the ability to repay through the same. You would need to submit your bank statement as requested by the lender and payslips of three to six months. Furthermore, self-employed individuals would need to show audited balance sheet, profit & loss report from the last two years, business income tax returns from the previous two years, and bank statement from the last six months.

Residence proof

You will need to submit a utility bill with your residential address in it for proof of residence. The lenders would know where to find you through this if you stopped paying the dues. You will also need a driving license if you plan to drive the car yourself. Valid documents include telephone bills, electricity bills, Aadhar cards, ration cards, life insurance policies, passports, voter identification, driving licenses, etc.

Identity proof

You will need to present a valid photo ID with your signature in it to prove your identity. Passport, Aadhar card, Voter card, driving license, PAN card, etc. are valid IDs. You will need to provide a proof of identity that will also have your date of birth as a proof of age.

Trade-in Documentation

If you are selling your old car or vehicle to purchase a new one, the relevant documents must be provided for the vehicle you are exchanging. Your old vehicle's title and registration papers will help the creditor determine the vehicle's accurate value. This would then affect the total loan you would need.

Additional conditions for a car loan in India

Credit Record

It is essential to have a good credit history and a low debt-to-income ratio to take advantage of any kind of loans. This would allow you quickly and without hesitation to approve car finance from the lender. The loan amount, as well as the rate of interest that would be applied, would also be determined by your credit score.

Make & Model

You would also need to describe the car you are going to buy. The estimated value of the vehicle must be presented as received by the dealership.

Additional Guarantees

A car is a collateral in its own right. Nevertheless, if you intend to protect the loan as collateral with additional assets, it would help you deal with the interest rate easier. In this case, for that particular asset, you would need to provide the complete details that would help the creditor assess the value of the same.

Make sure you have the mentioned car loan documents in place for smooth approval and disbursal of the credit.

Things to be aware if you are opting for an online car loan

It can be challenging to buy a car in the wallet. Opting for a car loan is the safest way to purchase a vehicle. Most financial institutions offer online car loans to make it simpler for you. Sounds appealing to apply for a car loan from the comforts of your home. But how can you ensure that your car loan lender is genuine and dependable? Taking some kind of loan is a process that should be carried out with utmost caution. Remember these considerations while investigating a lender for an online car loan.

Listed with RBI

Every company which is into the business of loaning money in India needs to be listed with the Reserve Bank of India. Always authenticate if the lender you are seeking for the loan is registered with Reserve Bank of India. If the lender is not capable of producing any documents or details of being listed with RBI, it is sensible not to avail loan from the said lender.

Verify if the lending institution is a reputed company in the market

There will be a lot of car finance companies who will extend you an online loan facility. But you should authenticate if these are well- known and have well established in the industry. They should have a good reputation in the market.

Time taken for loan approval and distribution

Loan approval and disbursal usually take less time if the loan application is made online. Some lenders approve your car loan application on the spot. Do ensure to contact the lender and ask for details in advance.

Online security

The lender should have a secure web site for the company. You are required to provide the lender with your personal information through the web site. So make sure to test if the website is safe to protect your details. Review the website for features such as loan terms and conditions, car loan interest rates, car loan EMI calculator, tenure alternatives etc.

Good customer support

Even if it is an online car loan finance, if you have any doubts, then the lender should have excellent customer support to help you. The lender should be reachable either through email or through the phone.

Transparency in loan terms

When you are requesting for a car loan, before approving to the terms and conditions of the loan, make sure that the lender gives you complete transparency on them. There should be no vagueness. If you feel something is wrong, then you should probably not apply for a loan with that particular lender.

Should ask you for a credit background check

The lender must do a credit check before giving out a loan. If your lender does not state anything about having a credit proof, then you should look at other lenders to avail the loan.

You can also check the reputation of the lender by looking out for reviews given online and on social media platforms. Research is vital in this entire process to make sure that you do not fall in a loan scam and do not get your car home.