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Last Updated : Aug 13, 2019 02:36 PM IST | Source: Moneycontrol.com

ICICI Bank Car Loan: Eligibility, Documentation, Fees & Charges Etc

ICICI Car Loan: ICICI Bank's car loans are available for both salaried & self-employed individuals with competitive rates of interests. Click here to get offers on car loans for new and used cars.

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One of the leading banks in the country, ICICI Bank offers car loans for new and used cars. One of the main reasons people turn to ICICI Bank for a car loan is that the application process is simple and hassle-free. Once you enter your information online, a bank representative will call you to confirm your details. Following this, your documents are cross-checked to confirm your identity and if everything is in order, you can avail a car loan. Sometimes, depending on your credit score (In case it is above 800), you may have instant approval for a car loan.

Furthermore, ICICI Bank offers you attractive and affordable EMI schemes that can let anybody buy their dream vehicle. You can avail a car loan from ICICI Bank irrespective of whether you are salaried or self-employed.

 

Why choose a car loan from ICICI Bank

Although you can avail a car loan from any bank of NBFC, a number of customers opt for an ICICI Car Loan for the simplicity in which your loan is cleared. As mentioned above, if you have a good credit score, then you could have an instant loan approval i.e. the loan amount is immediately credited into your account after you upload all the necessary documentation.

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In addition, ICICI Bank offers competitive rates of interests and affordable EMIs that don’t burn a hole in your pocket when you are repaying the loan.

 

 Features of an ICICI Bank Car Loan

Some of the features ICICI Bank offers while providing you a car loan are as follows:
  • Pre-approved car loan offer for select customers
  • Up to 100 per cent on-road funding
  • Simple and hassle-free documentation
  • Repayment tenures between one and seven years
  • Part payment, allowed with charges
  • Opportunity to offer refinance up to 140 per cent of the value of the vehicle
  • Motor insurance funding included in loan amount
  • Top-up loans available
  • Full pre-payment of loan is accepted with charges for a new car, but up to 80 per cent in the case of a used car
  • The minimum income required to get an ICICI Bank Car Loan is Rs 16,700 per month.
  • If applicant has other pre-existing loan liabilities, then it lowers his car loan amount eligibility.
  • ICICI Bank car loans can be availed for tenure of up to 7 years for a new car and up to 5 years for a pre-owned car.

Benefits of an ICICI Bank car loan

Some of the biggest benefits you can avail with an ICICI Bank car loan are the following:
  • Loans up to 100 per cent of the ex-showroom price
  • Simple documentation and instant loan approval
  • Fixed interest rates
  • Extended loan tenure
  • Pan-India Presence

ICICI Bank car loan eligibility criteria

To be eligible for an ICICI Bank car loan for a new car, you need to be the following
  • You need to be a minimum of 21 years and a maximum of 65 years to apply for a loan
  • When it comes to income, you need to earn a minimum of Rs 2.5 lakh if you are salaried, and Rs 2 lakh in case you are self-employed. Salaried individuals must have at least two years of work experience, while self-employed people should have had the business running for at least two years.
When it comes to a used car, you are eligible for a loan under the following conditions
  • The car cannot be over eight years old
  • You need to be a minimum of 21 years and a maximum of 65 years to apply for a loan
  • When it comes to income, you need to earn a minimum of Rs 2.5 lakh if you are salaried, and Rs 3 lakh in case you are self-employed Salaried individuals must have at least two years of work experience, while self-employed people should have had the business running for at least two years.

When it comes to credit score, the individual should have a CIBIL score of above 750. In case it is less than 750, chances are that you may not get the loan. However, in case you do, you may be required to pay a higher rate of interest.

 

Documents required while applying for an ICICI BANK car loan

For salaried individuals
  • Your bank statement for past six months
  • Two passport-sized photographs
  • Proof of identity: any one of the following – passport, Aadhaar, voter id
  • Address proof: any one of the following – utility bills, ration card, Aadhaar card, passport
  • Latest salary slips
  • Form 16
  • Income Tax returns of the past two years
For self-employed individuals
  • Your bank statement for the past six months
  • Two passport-sized photographs
  • Proof of identity – any one of the following – passport, Aadhaar, voter id
  • Proof of address – any one of the following – utility bills, ration card, Aadhaar card, passport
  • Registration certificate of your establishment
  • Form 16
  • Audited balance sheet
  • Income Tax returns for the past two years

ICICI Car Loan fees and charges

The following table will give you the details regarding the fees and charges for an ICICI Bank car loan
ICICINew Car LoanUsed Car Loan
Interest Rate10.75%15.50%
Loan TenureUpto 7 yearsUpto 7 years
Lowest EMIRs. 1,699 per lakhRs. 1,699 per lakh
Loan AmountMaximum of 100% ex showroom priceMaximum of 100% ex showroom price
Prepayment Charges5%5%

In addition, you are also required to pay a processing fee and a prepayment charge, the latter only if you want to change your bank

Processing Fee: ICICI Bank charges maximum of 5,000 processing fee.

Prepayment Charges: If you decide to foreclose or transfer your car loan to another bank, you need to submit an application for the same to ICICI Bank and follow RBI rules

 

ICICI Car Loan EMI Calculator

You can calculate the EMI you need to pay based on the following formula

EMI = [P x R x (1+R)^N]/[(1+R)^N-1];

where, P, R, and N are the variables, which means the EMI value will change every time you change any of the 3 variables.

What do the three variables mean?

P = Principal amount, which is the original amount lent to you by the bank. The greater your loan, higher the EMI you pay the bank

R = Rate of interest, which is the rate at which interest is charged on the principal loan amount. This value has a bearing on your EMI amount and it is important to compare rates of interest before opting for a loan

N = number of years for which the loan has been taken i.e tenure. Since the loan repayment is done every month, the tenure is calculated in months and not years. So, in case you have a 5-year period to pay off a loan, the tenure is 60 months.

Using ICICI's car loan EMI calculator is easy. First find out of the price of the car and the model you want to purchase and figure out how much down payment you can make. Subtract that from the price of the car to get at the amount of loan you need. Input all these data in MoneyControl's car loan calculator and it will show you the EMI that you need to pay.

Checking your ICICI car loan application status

Tracking the online status of your car loan is a simple and quick procedure. All you need to do is visit the bank’s website, enter the type of loan you have applied for, the application number, and your date of birth into the ‘check application status’ page. Click on submit, and check the status of the loan application.

In case you’re doing it online
  • You can visit the ICICI Bank website
  • On the home screen, click on the ‘Personal’ icon
  • Here, click on the loan icon, following which you are asked the type of loan you want to check. Click on car loan
  • At the top of the page there is an icon with three lines. Click on that and you are given a status bar, where you ae given the option to check your loan application
  • Here enter your application details, date of birth, and the One-Time Password sent to your registered mobile phone

Once you are inside the page, you have in front of you, details of your loan application, and whether the loan has been accepted.

In case you’re doing it offline, know that ICICI Bank has an effective customer care centre that is accessible through the bank’s 24x7 call centre number.

FAQs

Is it required to have a guarantor for the loan?

Not necessarily. In most cases the bank does not require a guarantor for the loan. However, if your income level does not meet the criteria of the bank, you may have to get a guarantor or co-applicant for your loan.

What are the documents required for a car loan?

You will need to submit an income proof, identity proof, age proof and address proof. As income proof you can submit three months’ salary slips or you income tax returns or your bank statements. As age and identity proof, you can submit Aadhaar Card, PAN Card, driving licence, voter’s ID and any other government identity proof. As your address proof you have to submit electricity/ gas/ telephone bill, Aadhaar Card, Voter’s ID, Ration Card or any other government address proof. If you are a self-employed proprietor or partner proprietor, you have to submit your audited statement as your income proof and your income tax returns.

Can I prepay my car loan?

Yes, you can pay your outstanding all at once only after you have completed six months after availing the car loan. Foreclosure charges may be applicable on early closure depending on your scheme.

ICICI Bank charges a fee of 5 per cent of the outstanding principal amount, clubbed with GST. To facilitate your prepaid car loan, you need to visit your nearest ICICI Bank branch with the following documents

Pre-payment Statement

Request letter signed by the loan applicant

Bank statement reflecting the clearance of the last installment

PAN Card (If the closing cash payment is more than Rs.50,000)

Vehicle Registration Certificate (R C Book Copy)

Vehicle Insurance Copy

Mode of payment can be cash, cheque or demand draft

How can I update my address?

You can do the following by visiting your nearest ICICI Branch with the necessary documents i.e. Aadhaar card, Passport, Voter id

How do I pay the loan?

You can either pay it using post-dated cheques, or link your bank account with the ICICI loan amount to carry out a monthly ECS

How can I apply for an ICICI Bank car loan?

You can do the needful by applying online on the bank's website. In case you have the i-Mobile app, then you can apply for the loan there. However, in case you want to do it the old-fashioned way, you can either visit your nearest branch or dial the toll-free 1860 120 7777

What is a Monthly Reducing Balance in Car Loan?

In the case of monthly reducing balance method, the principal gets reduced at the end of every month and the interest is calculated on the outstanding principal at the end of the month.

What is the importance of a collateral in a loan?

A collateral is required when you are taking a loan against your car. New car loans need not have a collateral as the cars being bought will act as collateral. In case of a loan against your car, you pledge the car as a collateral for loan. In case you default on the payment of the loan, the bank may seize the car. However, a collateral is not required for purchasing a new car using loan as the new vehicle will act as the collateral itself. So if you default on the loan, the bank may seize your car.

What happens if I default on my EMI?

If you default on your loan or miss an EMI, the bank will charge a penalty to you every month. The ICICI BANK Bank charges a 2 per cent overdue charge per month if your miss your payments or don’t make your payments on time.

Is it important to have a good credit score while applying for a car loan?

Yes, you must have a good credit score to be eligible to apply for a car loan. The credit score of an applicant is a measure for the bank to decide how well-deserving the candidate is for a loan. If you have a habit of maintaining your financials and meeting your financial commitments timely, you are less likely to default on a loan. Therefore you are a good candidate for a loan. A credit score above 750 is considered good enough for a car loan.

Does a car loan have any tax benefit for the borrower?

No. Tax benefits are available to borrowers on education loan and housing loan alone. There are no tax benefits on car loans.

What is the step up EMI scheme?

The HDC Bank offers a step-up plan that allows you to start repayment of your Car Loan with small EMIs and then gradually increase your EMI in future. This scheme is ideal for people whose incomes are likely to grow in the immediate future. The Step-up EMI scheme offered to an individual based on the assumption that an individual’s income grows over time and a car that may seem unaffordable now could be affordable next year. Using the Step-up EMI scheme, you can choose to take a higher loan amount but pay it back using smaller  EMIs. You can buy a bigger car in that case and increase your EMI as your income increases.

What is the Balloon EMI scheme?

The other custom-fit payback option that ICICI BANK offers to its customers is the Balloon EMI scheme where you can pay lower EMIs throughout the tenure and a larger lump sum amount at the end of the term. With this scheme you can choose to own a bigger car at the cost of a smaller car. For example you take a loan for 60 months. Now, you can pay 60 per cent of your balance until the 59th month and pay 40 per cent of the outstanding in the 60th month.

How can I compare the best loan offers for a new car?

ICICI BANK helps you compare, research and read reviews on new cars. You can search for cars by brands, prices and EMIs. The bank also provides you test drive assistance available on a wide range of cars for enabling to choose the right car for your needs. You can also visit third party websites to compare the cars and decide on a loan.

Does ICICI BANK provide insurance to cars bought with loan?

ICICI BANK offers a comprehensive insurance tool which offers protection to individuals against Permanent Total Disability, Accidental Death and Accidental Hospitalisation.

How do I know I am eligible for a car loan?

Before applying for a car loan, you can check if you are eligible for a loan. You can either visit an ICICI BANK branch and check you eligibility. Or you can check your eligibility instantly on the bank’s website. You can key in your details such as your employment status, total years of employment, your ITR details. The tool will tell you if you are eligible for a car loan and what is the amount that you are eligible to get.

How long does it take the bank to pass my loan?

ICICI BANK can approve a car loan application within 10 minutes. If the documentation on your application is complete, you car loan application will be approved instantly. It will take around a week to disburse the funds in your account. If you are an existing ICICI BANK Customer, you can get your loan funds credited to your account within seconds of getting an approval.

What are the features that decide the interest rate for a car loan?

ICICI BANK decides what interest rate you have to pay based on your credit score, your income, your customer relationship with the bank and the car’s age and condition. If you have a credit score of 750 above, you will get a favourable interest rate. If your income is high, you are highly eligible for a car loan. The interest rate will also depend on your income. If you have a good track record with your bank in terms of other loans or other products, you are likely to get a discount on the interest rate. Because the car being purchased acts as s collateral against the loan, the make, age and condition of the car are very important in determining the interest rates. If you default on your loan, the bank may seize your car.
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First Published on Aug 13, 2019 02:36 pm
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