6 Tips to Reduce your Car Loan EMI Burden
In our fast-paced lives, owning a car has become a necessity for an easy and convenient commute. However, the cost of living is rising every day and fulfilling your dream of owning a vehicle can often be difficult even if you have a decent monthly income.
It’s easier to buy the car of your choice today as you can opt for an Car Loan at affordable interest rates. There are many Car Loan products available in the market, and customised to suit specific customer needs.
Whether you are taking a new Car Loan or have an existing loan, the EMIs you pay can take a toll on your finances.
Read more on how to pay off your Car Loan efficiently.
Here are some factors that affect your cash outflow, and some tips to reduce the EMI burden.
- Vehicle purchase price
The first thing you need to ensure is that you get the best price on the car. Review and compare different cars to select the one that best suits your needs and also fits in your budget. Try and negotiate the best price possible with different car dealers and go with the one that offers the most competitive price. You can also try to persuade the dealer to offer some free accessories.
- Down payment on the vehicle
If you can afford it, try to make a large down payment on the car. This will help reduce your principal amount. I calculate the interest on your loan on the principal amount, so the lower the principal, the lower will be your EMI.
- Tenure of the loan
The shorter the tenure of the loan, the higher the EMI will be. If you cannot afford to pay a large EMI, opt for a longer tenure. You will have to pay a little more as interest. But you can always try to renegotiate your loan tenure once your financial situation improves.
- Loan prepayment
Many people get a bonus on Diwali, while some receive year-end incentives or a salary hike. Any time you receive such a windfall, make sure you use that money to prepay your loan at least partially as it will reduce your principal amount.
- EMI adjustment
One of the fastest ways to reduce your EMI burden is to increase your repayment amount in tandem with a rise in your income. try to increase your repayment amount, however small, each time you get a salary hike.
- Changes in lifestyle
With the additional burden of a loan it is important to make certain lifestyle changes. Try to time your EMI payment around the time you get your salary. Then plan your other expenses with the remaining funds. This will help you make your EMI payments on time and structure your expenses properly.
HDFC Bank has introduced Custom-fit Car Loans to suit your individual needs. They come with a host of exclusive features such as 100% financing on select vehicles, flexible repayment tenures, and pocket-friendly EMIs. And with the HDFC Bank Autopedia mobile app on Google Play, you can search, compare, and research cars by brand, price, and EMI.
HDFC Bank Custom-fit Car Loans come with multiple features such as Step-up, Balloon, Zero Foreclosure Charges, and exclusive insurance benefits through Suraksha Kawach. The Step-up option allows you to make easy and affordable EMI payments initially and gradually increase the EMI amount as your income grows over the tenure of the loan. The balloon option allows you to pay smaller EMIs throughout the loan tenure and then pay a large lump sum amount at the end of the tenure.
HDFC Bank customers enjoy the added benefits of special interest rates, quick disbursal of the loan amount, and much more. Customers also have the facility of ZipDrive, a process where the loan amount is disbursed instantly to car dealers anytime, anywhere via HDFC Bank NetBanking.
Take advantage of an HDFC Car Loan and buy the car you want, whenever you want!
Apply at HDFC Bank today and make your dream car a reality.
* Terms & conditions apply. Car Loan disbursal at sole discretion of HDFC Bank Ltd.