Interest rates on car finance hit an all-time low in the recent past. Car loan rates are expected to stabilise at this level and not dropping further. In fact, consumer loans rates are already at the lowest so there is little chance of them going down further. The rates will not be firming and market observers expect them to remain steady at the current levels.
Consumer financiers say that in the past, competitive pressures on official rack rates on car loans, and two-wheelers had forced down rates. This was when the consumer loan market was buoyant, aided by high liquidity in the banking system and players competed fiercely to undercut each other and grab a higher market share.
The pressure on retail lending has reduced. Consequently, players are not trying to undercut each other to get volumes. Earlier, the absence of any corporate interest had forced leading banks to focus aggressively on retail finance specially car loans.
Largely owing to increased competition, there are several loans agencies that are willing to provide no credit check car loans. You will generally opt for this type of loan when you have a poor credit history. If you want to buy a car, you should then try to get the maximum mileage from an auto loan. The interest rate is a key factor. It depends on a wide range of factors such as the amount you need, the car you choose, the dealer, your employer, designation and income category. Have an understanding of what kind of rate you will be offered, before you decide to go out to the car dealerships.
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