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Lowest Federal Bank Car Loan Interest Rates | Instant EMI Calculator, Apply Now!

Team AckoJul 17, 2023

Securing a car loan with favourable interest rates is a crucial step in financing your dream car.

The Federal Bank, a leading financial institution in India, offers car loans tailored to meet the diverse needs of borrowers.

In this article, we will delve into the Federal Bank car loan interest rates, examining their features, benefits, and eligibility criteria.

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Contents

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Federal Bank Car Loan Interest Rates in 2023

The following table provides more details about the Federal Bank car loan interest rates as of July 2023.

Federal Bank Car Loan Scheme

Interest Rate

New Car Loan

11% onwards

Used Car Loan

16.30% onwards

Features of Federal Bank Car Loan

Here are the key features of the Federal Bank car loan schemes.

  • Car loans featuring competitive interest rates.

  • Car loans offer repayment terms of up to 84 months.

  • Financing options are available up to 100% of the car’s ex-showroom price.

  • Regular announcements of various discounts and offers on car loans.

  • Individuals can avail of free personal accident insurance worth up to Rs.10 lakhs.

  • Swift processing of loan applications.

  • No-income documentation scheme provided.

How to Calculate Federal Bank Car Loan EMI

To calculate the EMI (Equated Monthly Installment) for a Federal Bank car loan, you can follow these steps.

Step 1. Gather the Required Information: Before you begin the calculation, make sure you have the following details.

  • Loan Amount: The total amount you wish to borrow from the bank.

  • Interest Rate: The interest rate (per annum) provided by the Federal Bank.

  • Loan Tenure: The duration of the loan in months.

Step 2. Calculate the Monthly Interest Rate: To determine the monthly interest rate, divide the annual interest rate by 12. For example, if the annual interest rate is 9%, the monthly interest rate would be 9%/12 = 0.75%.

Step 3. Determine the Number of Monthly Instalments: Multiply the loan tenure (in years) by 12 to get the total number of monthly instalments.

Step 4. Calculate the EMI Using the Formula: You can calculate the EMI using the following formula.

EMI = (P × r × (1 + r)^n) / ((1 + r)^n - 1)

P = Loan amount

r = Monthly interest rate

n = Total number of monthly instalments

Step 5. Perform the Calculation: Substitute the values obtained in steps 2, 3 and the loan amount into the formula.

Step 6. Interpret the Result: The resulting value is the Equated Monthly Installment (EMI) that you need to pay each month towards your Federal Bank car loan.

Eligibility Criteria: Federal Bank Car Loan Eligibility

To get a Federal Bank car loan to buy a new or second-hand car, the applicant must fulfil the following eligibility criteria.

  • The car loan applicant should be of at least 21 years of age. Similarly, the maximum age limit is 60 years.

  • The bank accepts car loan applications from salaried/self-employed individuals, partnership firms and sole proprietorships, companies, trusts, and educational institutions.

  • Both resident Indians and Non-Resident Indians (NRIs) meet the eligibility criteria for the loan.

  • In urban areas, the minimum take-home salary, after deducting existing loan EMIs and considering the proposed car loan EMI, should be Rs. 20,000. The income of the spouse can be considered to meet the minimum income requirement.

  • If the applicant possesses agricultural and rental income, it can be considered to meet the minimum income requirement. In such cases, the minimum income threshold stands at Rs. 40,000.

Application Process: How to Apply for Federal Bank Car Loan

There are two methods to apply for a Federal Bank car loan. The following sections explain the same.

Online Process

  • Visit the official website of the Federal Bank.

  • Fill out the enquiry form with basic details such as your name, address, mobile number, etc.

  • After filling out the form, click on the “Submit” button and request a call back from the bank official.

  • The bank official will give you a call and guide you through the car loan application process.

Offline Process

Walk into your nearest Federal Bank branch and enquire about the car loan. The bank official will guide you through the application process. 

Documents Required to Apply for a Car Loan from the Federal Bank

Here is the list of documents you need to apply for a Federal Bank car loan.

KYC Documents

  • Two recent passport-size photographs of both the applicant and the co-obligant are required.

  • Identity proof (Passport, Driving Licence, Voter ID, PAN Card, and Aadhaar Card).

  • Address proof (Passport, Driving Licence, Voters ID, or Aadhaar Card).

  • Age proof (Passport, Birth Certificate, Driving Licence, or SSLC/AISSE Certificate).

  • Non-resident customers need to submit certified copies of their Passport, Visa, Work Permit, and ID card as additional documents.

Salaried Applicants

  • Salary certificate or salary slip covering a period of three months.

  • Copies of income tax returns for the past two years or Form No.16 for the past two years are required.

  • Six months' bank account statements that clearly show the salary credits.

Self-Employed Applicants

  • Documentation demonstrating the existence of the business and its profile is required.

  • Bank account statements for the previous 12 months.

  • Income tax returns for the past two years, accompanied by the balance sheet and profit and loss account for those years. Alternatively, if available, the tax-paid challans may also be collected.

  • In case tax calculation sheets and tax paid challans are available, the applicant should provide the last two years' income tax returns supported by these documents.

Factors Affecting Federal Bank Car Loan Interest Rates

Several factors can influence the Federal Bank car loan interest rates. These factors include the following.

  • Credit Score: The applicant's credit score plays a significant role in determining the interest rate. A higher credit score indicates a lower credit risk, leading to more favourable interest rates.

  • Loan Amount and Tenure: The loan amount and repayment tenure affect the interest rate. Typically, larger loan amounts or longer tenures may result in slightly higher interest rates.

  • Vehicle Type: The type of vehicle being financed can impact the interest rate. Generally, new cars qualify for lower interest rates compared to used vehicles.

  • Down Payment: Making a substantial down payment can influence the interest rate. A larger down payment reduces the loan amount, potentially resulting in a lower interest rate.

  • Income and Employment: The applicant's income and employment stability are considered. Higher incomes and stable employment may lead to better interest rates.

  • Relationship with the Bank: Existing customers with a good relationship with the Federal Bank may be eligible for preferential interest rates or special discounts on car loans.

  • Market Conditions: Overall market conditions and the prevailing interest rate environment can influence the interest rates on car loans. Changes in economic factors may cause interest rates to fluctuate.

Check Out Car Loan Interest Rates from Other Banks in India (2023)

The following table lists the car loan interest rates (as of July 2023) of various banks in India.

Bank Name

Car Loan Interest Rate (Per Annum)

State Bank of India

8.60% onwards

Bank of Baroda

8.70% onwards

Union Bank of India

8.80% onwards

HDFC Bank

8.85% onwards (Rack Interest)

Federal Bank

11% onwards

Axis Bank

8.75% onwards

Canara Bank

8.80% onwards

Punjab National Bank

8.75% onwards

ICICI Bank

8.85% onwards

Kotak Mahindra Bank

7.70% onwards

Bank of India

8.85% onwards

IndusInd Bank

7% onwards

Yes Bank

9.7% onwards

UCO Bank

8.70 onward

Frequently Asked Questions (FAQs) about Federal Bank Car Loans

Here are some of the most common questions and their answers related to Federal Bank car loans.

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What is the interest rate for a Federal Bank car loan?

The interest rates for Federal Bank car loan starts at 11%.

How do I check the status of my Federal Bank car loan?

You can visit the bank’s official website to track the car loan application status or call up the customer care number or visit the branch to know the status of the loan.

How do I close my Federal Bank car loan?

You can close the Federal Bank car loan by making timely EMI payments. Alternatively, you can close the loan before the end of the loan tenure by making a pre-payment of the remaining loan amount.

Can I get a used car loan from Federal Bank?

Yes, you can apply for a used car loan from Federal Bank.

Disclaimer: The above content is for informational purposes only. It is recommended to take the help of an expert before making a decision.

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