A car loan EMI is the fixed amount you pay to the bank each month until the loan is fully paid off. It includes both the principal amount and interest on your car loan.
Key Factors for Car Loans:
- Down Payment: Typically 10-20% of the car's value. Higher down payment reduces EMI
- Interest Rate: Varies based on credit score, loan tenure, and car type
- Loan Tenure: Usually 1-7 years. Longer tenure means lower EMI but higher total interest
- Car Value: New cars often get better interest rates than used cars
Tips to Reduce Your Car Loan EMI:
- Make a higher down payment to reduce the loan amount
- Choose a shorter loan tenure if you can afford higher EMIs
- Improve your credit score to get better interest rates
- Consider pre-approved loans for better rates
- Compare offers from multiple lenders
