Getting a new car? Here is a document checklist that you need to keep handy before you apply for that Car Loan.
Buying a new car is exciting. It means that you no longer have to wait at the bus stop for those crowded buses or depend on auto rickshaws who simply refuse to go anywhere you want.
However, if you’re buying a car by opting for a Car Loan, then you must know that to get your loan processed you will have to submit a few documents.
Here is a brief document checklist for your Car Loan.
Additional Reading: Car Loan Application 101
Banks require customers to submit a list of documents that they need to process the application for a Car Loan. These documents are then verified by the banking personnel before the loan is disbursed.
So, if you have been comparing various loans to decide which one suits you the best, it’s probably time you also take a look at the supporting documents that you will have to submit to the issuing bank.
BB Tip: Check your eligibility for a Car Loan here!
Some of the common documents needed at the time of application are listed below.
- Income Proof: This is the most important document as it establishes the repayment capacity of the borrower to the bank. In case of salaried individuals, copies of your latest salary slip from your employer along with last 2 years’ Form-16 or Income tax returns will have to be submitted.
For self-employed people, copies of the previous 2 years income tax returns are required.
In case of private firms applying for a Car Loan, the income tax returns of the previous 2 financial years along with the complete audit report of the same period will have to be submitted.
However, bank account statements for the last 6 months will be required for all kinds of applicants.
- Age Proof: Proof of age as per government requirements have to be submitted in order to establish this criterion as stipulated by the bank. Your age proof can be your Voter ID, PAN Card, Aadhaar Card or your passing certificate from school (10th standard).
- Proof of Residence: Your financer will require an address proof of where you reside to process your loan application. The applicant has to provide correct proof of present and permanent address before sanctioning of the loan. Your address proof can be a copy of your Indian Passport, Aadhaar Card or any utility bill which has your name and address printed on it.
- Identity Proof: Identity proof along with 2 latest passport size photos are to be submitted along with the application form by the customer. This proof could be in the form of Passport, Voter ID, employee ID card, ration card, Aadhaar card, PAN card or even a Driving License.
- Miscellaneous Documents: For individual applicants, a proof of signature duly verified has to be submitted.
In case of partnership firms, a letter signed by all partners authorising one partner to execute the documentation of the Car Loan is required.
Similarly, for societies and companies applying for a Car Loan, the Resolution by Board of Directors (or such managing body) & Memorandum & Articles of Association (or Society/Trust deed) is mandatory document that will have to be submitted at the time of application.
- Quotation: In order to determine the amount of loan required, the customer will have to obtain a quotation of the cost of selected car from the dealer and submit the same along with the loan application to the bank.
Additional Reading: Drive Away With These Paperless Car Loans
Documentation is an important part of the Car Loan application and approval process, which is why applicants must ensure that all relevant and necessary documents are in order so as to facilitate an early and hassle-free approval.
The representatives of the financing institution will guide the applicant through the documentation process if required.
Once you have all your documents handy, you’ll be well on your way to zoom away in your brand new car. But, before you get out there and get stuck in traffic, be sure to check out some of our other amazing products and the offers we have on them.
Additional reading: Car Loan Handbook: All Questions Answered