Car Loan: If you're considering buying a new car on EMI, you should carefully review the interest rates of each bank. Doing so could save up to ₹1 lakh. Find out where you can find the cheapest loans.

Your dream of owning a new car will come true, with loans starting at 7.35%.

Car Loan Interest Rate: If you're considering taking out a loan to buy a new car, don't make a hasty decision. Comparing interest rates from different banks can help you save significantly. Currently, some banks offer car loans at interest rates as low as 7.35% per annum.

It's important to understand that the interest rate you receive will depend on your credit score, job position, income, loan amount, and loan tenure. Therefore, the interest rate may vary from customer to customer.

According to information received from Policy Bazaar...

• UCO Bank is offering car loans at the lowest starting interest rate of 7.35%.
• followed by Canara Bank and Bank of Maharashtra at 7.45%
• Whereas Union Bank of India, Punjab & Sind Bank, and Indian Bank are giving car loans at 7.50%.

If you take out a loan of Rs 5 lakh for 5 years, your EMI will be around Rs 9,983 at the lowest interest rate. However, at a higher interest rate, the EMI could reach Rs 11,634. This means you'll have to pay Rs 1,651 more each month. Over the course of 5 years, this amount adds up to around Rs 99,000. This means you can significantly reduce the total cost of your loan simply by choosing the right bank.

As for private banks...

• HDFC Bank – 8.15%
• ICICI Bank – 8.40%
• Federal Bank – 7.65%
• Karnataka Bank – 8.14%
• And IDFC FIRST Bank is offering car loans at an interest rate starting at 8.99%.

However, each customer's interest rate is based on their profile. If you have a good credit score and a fixed income, your chances of getting a lower interest rate increase.

Please also check the processing fees.

When applying for a car loan, be sure to consider not only the interest rate but also the processing fee. Some banks charge a lower fee, while others charge based on the loan amount. Many banks are currently offering discounts on processing fees and interest rates. Also, check if the bank charges any prepayment fees for early repayment.

Before taking out a car loan, carefully compare the interest rate, loan EMI, processing fees, prepayment charges, and other loan details. A little common sense and choosing the right bank can save you thousands of rupees over the entire loan period and make your dream of owning a new car a reality.