What is the cost of car loan

Buying a new car is tempting, be it an upgrade, first car or any other car for the family. Whatever the reason, buying a car loan makes it easy. Car loans are usually for three to five years, but some lenders may offer loans for up to seven years. A longer loan can mean smaller Equated Monthly Installments (EMIs), which makes the car look more affordable, but overall, you pay more in the form of interest. Don’t forget that a car is a depreciable asset, so taking out a large loan may not be the best thing to do. But if you take a car loan for a shorter tenure, the EMI will be huge and non-payment will mean a blot on your credit report. Conditions also apply to the loan amount. For example, some lenders offer loans for the full ex-showroom price of the car, while others may offer loans up to 80%. Apart from the interest rate on car loan, take a look at the applicable processing fee and other charges.