Question 1

What is the typical car loan interest rate in India?

Accepted Answer

Car loan interest rates range from 8.5% to 12% in 2026. New car loans are cheaper (8.5–10%) while used car loans are more expensive (11–14%). SBI, HDFC, and ICICI offer competitive rates.

Question 2

What is the maximum tenure for a car loan?

Accepted Answer

Most banks offer car loans for 1 to 7 years. A 5-year tenure is the most common and provides a good balance between EMI affordability and total interest paid.

Question 3

How much down payment should I make for a car?

Accepted Answer

Banks finance up to 80-90% of the car price. You need to pay 10-20% as down payment. A higher down payment reduces your EMI and total interest. Aim for at least 20% down.

Question 4

Is it better to buy a car with a loan or pay cash?

Accepted Answer

If you have the cash, paying outright saves you 15-30% in interest costs over the loan tenure. However, if the money can earn 12%+ returns (via equity MFs) while the car loan costs 9%, the math might favor investing and taking the loan.

Car Loan EMI Calculator

Frequently Asked Questions

Car Loan EMI Calculator

Frequently Asked Questions