What you need to know
Most people need a plain new car loan, but banks also run separate products for pre-owned cars, electric vehicles, NRIs, existing customers and borrowing against a car you already own.
Car loan types
| Type | What it is | Examples |
|---|---|---|
| New car loan | Buy a new car from a dealer; up to 7 – 8 years | All eight banks we track |
| Used / pre-owned car loan | Higher rate, shorter tenure, funding on valuation | SBI, ICICI, PNB, Bank of Baroda, NBFCs |
| Green / EV car loan | Lower rate or longer tenure for electric cars | SBI Green Car Loan, Union Green Miles, Canara green vehicle |
| Loan against car | Borrow against a car you own; car stays with you | HDFC Bank; Tata Capital up to 200% of value (refinance) |
| NRI car loan | For NRIs buying a car in India | SBI NRI Car Loan 8.40% – 9.35% |
| Loyalty / assured schemes | Better terms for existing customers | SBI Loyalty (8.35% – 9.30%) and Assured Car Loans; BoB 0.25% off for home-loan customers |
| Digital car loan | End-to-end online sanction | bob Digital Car Loan (up to 93% funding), PNB Digi Car Loan |
| Employee schemes | Concessions for government / PSU staff | BoB ₹500 fee for govt/PSU staff; PNB Pride |
Repayment structures
Standard EMI
Same EMI every month; interest on reducing balance.
Step-up / flexi
Lower EMIs early, higher later — e.g. SBI Flexi Pay.
Balloon
Smaller EMIs with a large final payment (offered by some lenders) — raises total interest.
Frequently asked questions
Can I use a personal loan to buy a car?
Yes, but a personal loan is unsecured and usually costs more than a car loan; a car loan is cheaper because the car is the security.
For information and comparison only. Loan terms, rates and rules change — confirm with the lender and read the Key Facts Statement before borrowing.