Car Loans For NRIs

By | May 30, 2017

Raghu, 35, works for a leading IT Company and lives in the US. His elderly parents live in India with his younger brother, who is completing his graduation. Because Raghu’s parents often fall sick due to their poor health, they make frequent trips to the hospital.

Since depending on a neighbour or a cab during the wee hours is rather inconvenient, Raghu decided to buy his parents a car. While you could argue that he should have bought his parents a good Health Insurance plan, a car is a good option as well considering the circumstances.

Additional Reading: How To Choose A Comprehensive Health Insurance Plan

Now, here is Raghu’s dilemma. He does not have enough saved up to pay for the car in full. However, he is considering taking out a Car Loan to purchase the car. But, is this possible since Raghu is a Non-Resident Indian (NRI)?

The good news is that an NRI can get a Car Loan in India. Yes! Any Indian citizen residing abroad who has a salaried job or is self-employed in his country of residence qualifies as an NRI and can apply for an NRI Car Loan. An NRI Car Loan can be taken for purchasing a new as well as a used car.

Keeping people like Raghu and many others in mind who don’t reside in India but want to buy a car, several public and private sector banks now offer Car Loans to NRIs. The requirements and features of these NRI Car Loans are slightly different from a regular loan.

Additional Reading: Car Loans – Interest Rates, Eligibility & More

Special Features and Requirements of NRI Car Loans 

  1. The borrower may not be able to buy the car in his/her name

Although you, as a borrower, will be the one paying the EMIs on the Car Loan, if you happen to be an NRI, you will not be able to buy the car in your name. You will have to buy it in the name of your next of kin who is a resident citizen of India.

This person then becomes the borrower of the Car Loan and you, as an NRI, will become the guarantor for the loan. The car will be registered in the name of your relative while the repayment of the loan will be done by you.

Additional Reading: Your Car Loan EMI Calculator Guide

  1. Your country of residence needs to be on an ‘approved list’ of countries

Banks have their own list of ‘approved’ countries and if you happen to reside in any of these countries, then it will be rather easy for you to get a Car Loan.

Countries such as the US, the UK, Malaysia, Singapore and West Asian countries are on the approved list of most banks. You will have to check with your respective bank in case you’re residing in a country other than the ones mentioned above.

Additional Reading: 7 Things To Consider Before Buying A Car Loan

  1. Customer relationship

Your Car Loan approval also depends upon your banking relationship, past record and age. Usually, banks also consider long-standing relationships of about 3-5 years when granting a Car Loan to an NRI.

However, the bank is at liberty to turn down any application by a NRI for a Car Loan in case the credentials of the relative are in doubt at any point of time.  Additionally the car has to be hypothecated to the lending bank and all the relevant documents have to be deposited with the bank after registering the car.

  1. Income criteria

As with regular Car Loans given out to Indian residents, NRIs too need to have a sustainable income and have to be above a certain income level in order to be considered eligible.

  1. Repayment Tenure: The repayment period for such loans is similar to conventional Car Loans for resident Indians and ranges from 1 to 7 years. The EMI is worked out on the basis of the tenure, loan amount and the interest rate that is applicable.
  2. Loan Amount: This aspect is decided as per conventional norms depending upon the income of the NRI, which decides his repaying capacity as well as the actual cost of the car being purchased through the loan. In some cases the financiers offer NRI Car Loans for used cars too.

Additional Reading: Top 10 Used Car Loans: Take Your Pick

  1. Interest Rate: The interest rate for NRIs will be the same as those for resident Indians. Presently,interest rates start at 8.9%. However, the processing fee for NRI Car Loans will differ from one bank to another.
  2. Payment of EMI: The repayment of the loan through EMIs can be undertaken by the NRI through any accepted inward remittance such as an NRE/NRO/FCNR account or money transfer from the nation of current residence. Even a relative of the NRI may undertake payment of the Car Loan EMIs.

 Check This – Car Loan EMI Calculator

  1. Documentation: You can submit the documents either online, at the branch of your residing country (if it has one) or through your co-applicant.

 Documents that are required for an NRI Car Loan

NRIs applying for a Car Loan in India will have to provide the following documents:

  • Proof of identity of guarantor as well as borrower such as PAN card, Passport etc
  • Photographs of guarantor and borrower
  • Proof of residence of guarantor and borrower
  • Employment certificate or work permit of guarantor
  • Salary certificates of guarantor or bank statements from accounts of banks abroad
  • Guarantee letter
  • Hypothecation letter

A lot of banks are now offering Car Loans to NRIs. Be sure to keep all your documents handy when you approach them. Also, read through the fine print before you take the leap.

All information including news articles and blogs published on this website are strictly for general information purpose only. BankBazaar does not provide any warranty about the authenticity and accuracy of such information. BankBazaar will not be held responsible for any loss and/or damage that arises or is incurred by use of such information. Rates and offers as may be applicable at the time of applying for a product may vary from that mentioned above. Please visit for the latest rates/offers.

5 thoughts on “Car Loans For NRIs

  1. Mark David

    Thanks for mentioning car loans for NRI. This will help NRI to buy new car and they can avoid fraud people by having good Guarantor.

  2. Shaik Abdul Jabbar

    Iam working in kingdom of Saudi Arabic Having NRI Account in HDFC
    I would like apply auto loan

    1. Team BankBazaar

      Hi Shaik Abdul Jabbar,

      You can apply for a Car Loan with HDFC. You can check your eligibility here.

      Team BankBazaar

  3. Mark steve

    Yeah so true! These tips are really helpful for everyone who searching about taking car loans for naris. Thanks for sharing such nice blog with us.

    1. Team BankBazaar

      Hi Mark steve,

      Glad you found this information was useful. Have a nice day!

      Team BankBazaar


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