A car loan is a loan. Nonetheless, they require certain payments to be made before specific dates and columns are ticked off before and after a loan. A defaulter fails to cross the necessary line. In colloquial banking terms, a defaulter has a bad credit score and cannot pay timely payments.
Credit Information Bureau (India) Limited (CIBIL) is a credit company that manages individuals, companies, trustees and any other banking customer. This company manages a credit report with personal information, banking information, employment information, public records and any other credential and crucial information of the customer.
The report is indicated by a three-digit score that varies between 300-900 at large. Above 750 is a great score. Below 600 is a bad score. This report plays a critical role in determining an applicant’s ability to avail of any loan.
How do you avail of a car loan if you are a defaulter?
Legitimate organizations like banks and Non-Banking Financial Institutions generally hesitate to sanction a loan for a defaulter. But they don’t necessarily reject it if you meet their other expectations. High income: showing the lender that you have a large sum of money incoming in your account each month and that it would be more than enough to pay off the loan debt is the first step in progress—that way, you give them a chance to know your capability.
The second is that avoid availing of many loans at once. If you have more than what you can chew, the banks and NBFCs will double back down in approving, so it is better if you only avail of a car loan at the time. The credit report shows the lender every loan you take out, and it is best if you are not deceiving the bank or financial institute.
When you are a defaulter, you must make compromises in order to obtain the loan money as quickly as possible. So ask the lender for a low principal, go for a car that you can afford and offer to make the maximum amount as a down payment. The latter instils confidence in the financier to lend you money. A low loan amount increases the eligibility criteria in addition to decreasing your monthly instalment amount.
The fourth way to increase your eligibility is by adding a co-applicant to the application. A co-applicant shares the liability of paying the loan in addition to you(primary applicant). As two members are responsible for paying the debt, the bank or NBFC is more liberal in granting the loan. The co-applicant must be related by blood(direct family member) or husband and wife. Most banks and NBFCs don’t allow the co-applicants to be siblings. The above are a few of the many ways you can have a car loan despite being a defaulter.
How do you handle it after availing of the loan?
A car loan is sanctioned, you have bought the car, but you face difficulties in paying off the loan. What to do? How do you maintain your credit score at the same time while managing to have the car? These are questions that every borrower asks at least once after availing of the loan.
The first and obvious solution is to make budgets and cut your expenses. Budget planning becomes necessary after taking out a loan. Cut all your unwanted expenses like excessive shopping and unnecessary travelling.
The second is asking the bank or NBFC for a loan moratorium. It means for three months, and the borrower doesn’t need to pay the interest amount. They are given if the borrower faces serious financial problems(unemployment or bankruptcy). You can also consolidate your debts, which means if you have multiple loans at once, you combine all of them into one loan and pay a single interest for one principal amount.
Conclusion
HDFC Car Loan is an illustrious loan that helps millions in making their dreams come true. Online and offline facilities are available for the customer to avail a car loan.
Author Bio
Thanks for stopping by and checking me out. I’m Vikram Arora, a writer, blogger, and author with over 2 years of writing experience. Check out some of my published works. I’ve published so many articles in online publications; blog posts. Being a part of this field for a long time now, I written many informative articles and blogs benefiting and assisting many in this field. And this article is all about HDFC Car Loan, which clarify all your quires regarding loan.
