Your salary plays a crucial role in determining your car loan eligibility. The higher your salary, the more you are likely to be eligible for a bigger car loan. Lenders look at your income to decide your loan repayment capacity as it determines how much you can afford to pay per month. A higher salary indicates a stable income, which reduces the risk of defaulting on loan repayments. On the other hand, a lower salary may lead to a smaller loan amount to ensure that the borrower can repay the loan comfortably. Your employment status and job stability also affect your eligibility for a car loan, as lenders prefer borrowers with a stable income source. Thus, your salary is a vital factor in deciding your car loan eligibility.
Understanding car loan eligibility
There are several factors that affect your car loan eligibility. This includes your credit score, income, employment status, down payment, and debt-to-income ratio. A good credit score increases the chances of getting approved for a car loan, while a low score may require a co-signer or a higher interest rate. Income and employment status also play a critical role, as lenders prefer borrowers with stable income sources. Bajaj Finance offers two types of car loans – used car loans and new car finance. As the name suggests, used car loans provide funds to purchase a pre-owned car while new car finance provides you with financing for a brand-new vehicle. When you choose any of these car loans, you can get a high-value loan by fulfilling the simple eligibility criteria and submitting just a few documents.
Eligibility criteria for new car finance
If you are applying for Bajaj Finserv New Car Finance, you need to fulfil the following eligibility parameters.
- You should be a resident Indian citizen aged between 18 years to 80 years*.
- Your credit score should be 700 or higher.
- You should have a minimum salary ofRs. 25,000.
- If you are a self-employed individual, you need to submit the ITR proof for the past 2 years.
Apart from fulfilling the eligibility criteria, you also need to submit the required documents for approval.
*Higher age limit is applicable at the time of loan maturity.
Eligibility criteria for used car loans
Our used car loans come with simple eligibility criteria and minimal documents. You need to fulfil these basic parameters to qualify for a used car loan.
- Nationality: Resident Indian
- CIBIL Score: 700 or higher
- Age: 18 to 80 years*
If you are a salaried individual, you should have experience of at least 1 year with a minimum monthly salary of Rs. 20,000.
If you are self-employed, you should submit ITR proof for 2 years.
*Higher age limit is applicable at the time of loan maturity.
Strategies to improve loan eligibility
A car loan is a reliable way of financing the purchase of a vehicle, but securing a loan with favourable terms can be a challenging task. Here are some tips on how to improve your car loan eligibility:
Check your credit score and credit report - Ensure that your credit score is healthy and free of errors as the lenders usually check it to assess your repayment capacity.
Keep your debt-to-income ratio low - Maintain a low debt-to-income ratio by paying down your existing debt.
Increase your down payment - Paying more upfront can reduce the loan amount and improve your loan-to-value ratio.
Improve your job stability - Lenders prefer borrowers with stable job histories as it indicates a reliable source of income.
Consider a co-signer - A co-signer with a strong credit history can enhance your loan eligibility by providing additional assurance to the lender.
