Allahabad Bank Car Loan Interest Rates
Allahabad Bank ‘All Bank Dream Car’ loans are available at attractive and flexible interest rates 9.10% along with a repayment tenure of up to 84 months. Customers need not go through the hassle of extensive documentation or a very long waiting period to avail their loans. Eligibility is decided based on the person’s income among other factors and this loan is available for customers who are self-employed, salaried, professionals and businessmen apart from firms, corporate, agriculturalists and also pensioners. Low margin and a high limit of the loan are two other factors that make the Allahabad Bank car loan one of the most accessible and easy-to-avail loans in the market currently.
Allahabad Bank Car Loan Rates 2018 Table
| Base Rate | 9.10% |
| Rate of Interest | 9.10% |
| Margin | 15% of the vehicle’s on-road price and this includes one-time registration along with first-time insurance charge and road tax |
| Loan Limit | Thrice the net annual salary |
| Loan Tenure | 12 months to 84 months |
| Minimum monthly income required | Rs. 25000 for salaried individuals |
| Documentation Charges | Nil |
| Prepayment Penalty | In case of a takeover, 2% of the outstanding balance. |
| Processing Charges | 1% of the amount taken as loan(minimum of Rs.500) However, Allahabad Bank employees are exempted from paying processing charges |
| Mortgage Charges | NA |
| Inspection Charges | Nil |
How do you calculate Interest Rates for an Allahabad Bank Car Loan?
Customers need to repay their loans through Equated Monthly Installments or EMIs. Rather than paying the entire amount as one lump sum, customers can repay the loan through a small amount paid monthly until the loan is completed. The amount paid as EMI each month depends on the amount borrowed and the rate of interest charged. Therefore an EMI amount consists of both the principal amount and the interest amount. EMI can be easily calculated using a simple formula.
E = P*r*[(1+r)^n/((1+r)^n-1)]
In the above formula, E refers to the EMI amount that is to be paid, P stands for the principal amount that is borrowed, r is the rate of interest charged per month and finally n is the number of years.
Factors affecting Allahabad Bank Car Loan Interest Rates
Interest rates are perhaps the most important factor taken into consideration by prospective customers. Lower the interest amount, the more affordable is the loan. There are various factors that play a role in the Bank’s interest rate. Some of these factors include –
- Debt-to-income ratio – Banks take into consideration the applicant’s income and their debt history. Customers whose financial history is fraught with late payments or large amounts of debt have a harder time procuring car loans as banks are wary of their repayment capabilities.
- Loan Tenure – Banks generally offer a tenure of 12 months to 84 months for customers to repay their loans. Although most opt for a longer tenure so as to reduce the burden of EMI payments, this can have a negative impact on the interest rates. Longer tenures indicate a high risk of default payments for the bank hence in order to reduce the risk, they may increase the interest rate for the customer. Hence a shorter tenure is always advisable.
- Income – Banks stipulate a minimum income requirement that has to be met by customers before availing a particular loan. This minimum amount decided by the bank varies based on the occupation of the customer such as if the customer is salaried or self-employed or if the customer is a pensioner and so on. A higher income indicates less financial risk for the banks hence there is a greater chance of the customer receiving the loan at a lower rate of interest.
- Co-applicant – Having a co-applicant increase the chances of a customer availing loans at a low rate of interest. This is due to the fact that the co-applicants income will also be added to the overall net income and therefore increases the repayment capacity of the customer reducing the risk of default payments.
- A prior working relationship with the bank is an added benefit. Allahabad Bank has various offers and benefits for customers who have a prior working relationship with them.
