Frequently Asked Questions- Car Loans
What is the Eligibility Criteria for a Car Loan?
Car loans are granted to:
Individuals, Sole Proprietorships, Partnership firms, Companies, Trusts, Educational Institutions and any other lawful organizations with adequate / regular income to repay the loan.
What is the tenure of a car loan?
New Vehicles : Maximum 84 months for Resident customers and maximum 60 months for NRI customers
Used Vehicles : Maximum 84 months for Resident customers and maximum 60 months for NRI customers with the condition that the total of loan period and age of the vehnicle shall not exceed 10 years
What is the interest rate for car loan?
Car loan interest rate will change subject to the changes made by Bank/RBI from time to time. Please click here to know latest car loan interest rates. Whenever car loan interest rates are changed, new rates and corresponding EMI shall be communicated to the borrower.
How can I make repayment of car loan?
Repayment of car loans are to be made in Equated Monthly Installments (EMI).
What is EMI?
EMI stands for Equated Monthly Installment. It includes repayment of the principal amount and payment of the interest on the outstanding amount of your Federal Bank car loan. Your housing loan EMIs are fixed at the time of availing the loan. EMI's are used to pay both interest and principal amount of a loan in a way that over a specific number of years, the loan amount is repaid to the bank along with interest.
What are the factors affecting car loan EMI?
- Principal - The principal is the loan amount that you avail from Bank. Lower principal will lower your EMI and vice versa.
- Rate of Interest - The rate of interest is the rate at which Bank offers you the car loan. It is also directly proportional to your car loan EMI.
- Tenure - The tenure or the period is the time within which you repay your loan. It is inversely proportional to EMI. It means longer tenure makes EMIs cheaper and vice versa.
What is Fixed rate of interest?
Fixed rate of interest means interest rate remains constant during the entire tenure of the loan.
What is Floating rate of interest?
Floating rate of interest means interest rate fluctuates based on the changes in RBI’s Repo Rate.
What is Repo Rate?
Repo rate is the rate at which Reserve Bank of India lends money to commercial banks in the event of any shortfall of funds. Repo rate is used by monetary authorities to control inflation.
What is Pre-EMI?
Under the Pre-EMI option, the borrower is required to pay only the interest on the loan amount that will be disbursed as per the progress on the construction of the project. The actual EMI payment starts after the possession of the house / flat.
How can I calculate car loan EMI?
You can calculate car loan EMI using our Car Loan EMI calculator by entering principle amount, tenure, rate of interest etc.
What is an amortization schedule?
Amortization is a tabular schedule with details of interest payment and periodic principal of a loan along with the amount outstanding after each payment and the decrease of loan balance till zero.
Can I prepay my car loan?
Yes, you can make your prepayment in either part or full.
What are the service charges for Federal Car loan?
Please click here to know more service charges for car loans.