“Pre-owned car loans allow the customer to spread out the cost of the vehicle over a longer period of time. With banks like ours offering loans up to 100% of the value of the car, the customer is relieved of the hassle of accumulating down-payment and can keep their savings intact. For customers availing a loan for the first time, a pre-owned car loan provides a great opportunity to build a healthy credit score by making timely EMI repayments, which significantly enhances their credibility for a future sanction on their home, business or a personal loan.”

The interest rate on used car loans typically starts at 10.99% and could go up to 18.5% depending upon your profile and the age or segment of the car. If you’ve maintained a good credit score, the interest rate for you will most likely be on the lower end of this spectrum. Interest rates on new car loans, on the other hand, range from approximately 8.5% to 15.5%, subject to your profile and credit score, just like any other loan.

These rates, however, can vary from lender to lender. While people often choose to avail a loan directly from banks and NBFCs, OEMs and used car dealers are now aggressively leveraging their partnerships to offer customers tailored finance solutions that cater to their varying needs.