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To add to the discussion, I am listing pros and cons of a personal loan vs such special loans. Hope that it is helpful...
Pros of Personal loan:
1. No hypothecation of vehicle means that the vehicle is in your name from the start. In auto loans, usually the vehicle is on the Bank's name and once the loan gets paid off, the vehicle gets transferred to your name.
2. Ease of paperwork
3. Fast disbursal of loan. Most banks claim disbursal within 48 hours if documents are in place
4. Full 100% value of the bike can be financed. For a typical auto loan, this Loan to Value is about 80%
5. Again if you are amongst the preferred customers of the bank, you can get really good deals.
Cons of a personal loan:
1. The rate of interest varies between 12.5% to as high as 18% depending upon the profile of the customer.
2. Processing fees can also be charged between Rs. 999 to 1.5% of loan amount. Again, this depends on the profile of the customer.
3. There can be a cap on the loan value. So, financing of Ninja H2 is not possible by a personal loan.
4. There can be some remote areas that are not serviced by banks. But I doubt you will find a bike showroom in those areas!
5. The rate of interest can be higher if you are self employed (except if you are a Doctor)
The best deals on a personal loan can be availed if a customer falls in the below categories:
1. Salaried customer working with a reputed company. You can get better deals from the bank where your salaried account is.
2. Good credit history. A CIBIL score more than 700 is generally required by banks.
3. Past history with the bank (account/FD/Loan etc)
4. Age between 22 and 55 years.
5. Living in a metro/big city
6. Own residence
7. Doctors usually get the best deals on a personal loan.
Last but not the least, always bargain for a better interest rate. If the loan amount is high, it is not uncommon to get a discount of 0.5-1% on the rates.
PS: If you are applying in the last week of month/quarter, your application is likely to get processed quickly and you can get good discount too. Just don't tell the bank that a guy named Rachit told you that!
Pros of Personal loan:
1. No hypothecation of vehicle means that the vehicle is in your name from the start. In auto loans, usually the vehicle is on the Bank's name and once the loan gets paid off, the vehicle gets transferred to your name.
2. Ease of paperwork
3. Fast disbursal of loan. Most banks claim disbursal within 48 hours if documents are in place
4. Full 100% value of the bike can be financed. For a typical auto loan, this Loan to Value is about 80%
5. Again if you are amongst the preferred customers of the bank, you can get really good deals.
Cons of a personal loan:
1. The rate of interest varies between 12.5% to as high as 18% depending upon the profile of the customer.
2. Processing fees can also be charged between Rs. 999 to 1.5% of loan amount. Again, this depends on the profile of the customer.
3. There can be a cap on the loan value. So, financing of Ninja H2 is not possible by a personal loan.
4. There can be some remote areas that are not serviced by banks. But I doubt you will find a bike showroom in those areas!
5. The rate of interest can be higher if you are self employed (except if you are a Doctor)
The best deals on a personal loan can be availed if a customer falls in the below categories:
1. Salaried customer working with a reputed company. You can get better deals from the bank where your salaried account is.
2. Good credit history. A CIBIL score more than 700 is generally required by banks.
3. Past history with the bank (account/FD/Loan etc)
4. Age between 22 and 55 years.
5. Living in a metro/big city
6. Own residence
7. Doctors usually get the best deals on a personal loan.
Last but not the least, always bargain for a better interest rate. If the loan amount is high, it is not uncommon to get a discount of 0.5-1% on the rates.
PS: If you are applying in the last week of month/quarter, your application is likely to get processed quickly and you can get good discount too. Just don't tell the bank that a guy named Rachit told you that!
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), but Banks are attracting customers through Lucrative offers and make people buy things they cannot afford right now.
from my credit card for Rs 1 Lac with low interest rate(re-payment of Rs. 1.13 Lac in 2 Years), along with the savings(mine + family
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