Canara Bank Car Loan Interest Rates
Car Loan Interest Rates vary based on a number of factors. These interest rates are one of the main deciding reasons behind a person’s choice for a particular car loan. Canara Bank offers attractive interest rates that varies between 9.90% to 9.95%. Apart from this, loan tenures are also flexible with the bank offering a time period of upto 84 months.The best part is that Canara Bank does not have a maximum limit per say in terms of the loan amount that is offered. These loans are provided for all individuals, either self employed or salaried customers as long as the minimum amount they earn is Rs.3 lakhs per annum.
Canara Bank Car Loan Rates Table
| Base Rate | 9.65% |
| Rate of Interest(fixed) |
|
| Processing Fee | 0.25% on the amount of loan between Rs. 1000 and Rs. 5000 |
| Loan Amount | 80%/85%/90% of the price of the car and this includes life tax, invoice value, insurance premium, registration charges and also accessories |
| Loan Tenure | Up to 84 months |
| Minimum annual income required | Rs. 3 lakhs annually |
How to calculate interest rate on the Canara Bank Car Loan?
The payment option that is chosen to pay car loans in EMI or Equated Monthly Installments which basically is the principal amount along with the interest amount that is based on the rate of interest previously determined by the bank. EMIs are paid over a tenure suitable to the applicant and with the progress in the tenure, there is a reduction in the interest amount and increase in the principal amount.
A formula for calculating the EMI on car loan is given below-
E = P*r*[(1+r)^n/((1+r)^n-1)]
Where E stands for the Monthly EMI, P is the principal amount, r refers to the interest rate applicable per month and n stands for the number of years.
Factors affecting Canara Bank Car Loan Interest Rates
There are many different determinants when it comes to deciding the car loan interest rates for Canara Bank. Based on this and the tenure chosen by the borrower, the final amount of EMI or Equated Monthly Installment that is to be paid also varies. Some of these important factors are listed below.
- Duration or tenure of the loan – This is a significant determinant that has an impact on the total amount paid by the borrower. Most choose tenures that are longer as it gives them the option of paying back the loan in smaller installments, however this can be detrimental as the total amount of interest that is paid increases thereby increasing the total amount that is to be repaid. Hence it is advisable to choose a shorter tenure.
- Income – The borrower’s income is another aspect that is deemed important by banks and financial institutions. Some may also have a minimum income requirement that is to be met by the applicant in order to become eligible for the loan. These income requirements also vary based on other factors such as if the borrower is self employed or salaried.
- CIBIL Scores – A highly significant factor that is taken into account by banks is The TransUnion score and a person’s eligibility to avail a loan from Canara Bank is based on this score. Generally, a score of above 750 is given preference to and applicants with higher scores find it easier to avail loans at competitive interest rates as well.
- A prior relationship with the bank is another benefit that can be availed by borrowers as the process of procuring loans become a lot simpler and is more convenient.
