What Are the Requirements to Get a Used Car Loan?

Used cars are affordable, have a low depreciation rate, and are cost-effective in the long run. No wonder the pre-owned vehicle market is attracting a lot of buyers!

And so, keeping in mind their increasing popularity, lenders also offer great financing options to potential buyers at reasonable rates. You can also opt for a pre-owned car loan to bring home your choice of car.

Before applying for a loan, read on to understand the various used car loan requirementsthat you must take care of.

Second-hand car loan eligibility

The eligibility criteria for second-hand car finance depends on income, work stability, CIBIL score, and credit history.

#1 Income

The higher is your monthly income; the better is your eligibility. This way, you’ll qualify for a bigger loan amount.

#2 Loan history

You must have a repayment history free of defaults. If you have outstanding loans or credit card bills, clear your dues before approaching the lender.

#3 CIBIL or credit score

Having a healthy credit or CIBIL score, ideally 750 or more, increases your eligibility for a used car loan.

Additional Read: What to Look for in a Used Car Loan Agreement

#4 Work stability

You should have a stable income source. If you frequently switch jobs or your business delivers inconsistent returns, your loan application can be rejected.

While used car loan criteria differ from one lender to another, to avail of a loan with Tata Capital, you must meet the following conditions:

For self-employed individuals

• You must belong to the age group of 21 to 65 years
• Your business should be up and running for a minimum of 3 years
• You must have an annual income of Rs. 2 lakhs

For salaried employees

• You must belong to the age group of 21 to 60 years
• You must earn at least Rs. 20,000 per month
• You must have a stable working experience of at least 1 year

Documents required

Besides fulfilling the used car loan eligibility conditions, you must submit certain documents. Here’s a list of documents needed for verification with Tata Capital.

#1 For salaried individuals

• Copy of photo identity proof: Aadhar card, voter ID, PAN card, driving license, or passport
• Passport-sized photographs
• Copy of income proof: Past 3 months’ salary slips
• Copy of address proof: Electricity bill, ration card, or passport
• Copy of mobile or telephone bill
• Copy of vehicle’s registration certificate

#2 For self-employed individuals

• Copy of photo identity proof: Aadhar card, voter ID, PAN card, driving license, or passport
• Copy of telephone or mobile bill
• Copy of address proof –Utility bill, property registration documents, bank statements, voter ID, property tax receipt
• Copy of signature with signature proof
• Copy of income proof: Income Tax Returns (ITRs), audited Balance Sheet, P/L statements, last 3 months’ bank statements

Additional Read:  7 Questions to Ask Yourself before Taking a Used Car Loan

Over to you

Looking for a reliable lender? Well, your search ends here with Tata Capital! Apply online for a quick second-hand car loanand enjoy affordable used car loan interest rates and convenient repayment options. Connect today to drive away with your desired ride!