Commercial vehicle loans are loans that are offered to borrowers, generally self-employed, trusts, partnerships, organizations, etc., for the purchase of vehicles for commercial or commercial purposes. This loan is used mainly by those who are involved in the transportation business. A commercial vehicle loan can be used to purchase buses, trucks, dump trucks, tankers, light and small commercial vehicles. These loans are offered by many leading lenders in India such as ICICI Bank, YES Bank, Indiainfoline, Mahindra Finance, etc., at affordable interest rates. The entire process of commercial vehicle loan application is swift, hassle-free, and requires less paperwork.
Features of A Commercial Vehicle Loan:
- You can get a commercial vehicle loan at a low interest if your profile matches with the criteria put forward by the lenders.
- The processing time of a commercial vehicle loan is fast with easy documentation and approval.
- Most of the prominent banks in India provide commercial vehicle loans at affordable rate of interest without any security.
- Some of the banks assign a personal relationship manager from starting till procurement of the vehicle. He/she will do all documentation and address every issue related to the loan.
- Once all required documents are submitted, it takes around 7 days for the disbursal of the loan amount.
Different Types of Commercial Vehicle Loan:
Commercial Vehicle Loans can be used for a variety of business vehicles that are used in different locations for various purposes. Depending on the type of vehicles for which these loans are requested, commercial vehicle financing is differentiated into three broad categories, namely:
1. New Commercial Vehicle Loan
This type of commercial vehicle loan is provided to clients for the purchase of new commercial vehicles for business purposes. Banks offer up to 100% financing on the chassis or base frame value of the vehicle. Some of the banks provide additional financing for the construction of the body of the vehicles in selective cases according to the profile of the borrower.
2. Old Commercial Vehicle Loan
Old or used commercial vehicle loans are loans that are offered to purchase all makes of used or used commercial vehicles. Under this loan, borrowers can expect to obtain financing for older vehicles that are up to 15 years old. Most banks provide up to 90% financing on the value of the used vehicle or the value of the depreciation net.
2. Commercial Vehicle Refinancing
Under a commercial vehicle refinance, banks offer an existing vehicle loan that is loan-free or take over an existing commercial vehicle loan and provide additional financing based on eligibility. While some borrowers can lower the monthly EMI on their existing loan and free up some cash by refinancing an existing loan at lower interest rates, others can get direct financing on their free vehicles to meet working capital needs.
Who can avail a Commercial Vehicle Loan ?
- Individuals
- First-time users and buyers
- Small, medium and large-sized fleet owners
- Proprietorship firms and Partnership firms
- Public Limited & Private Limited Companies
- Trusts and societies
- Schools and colleges
- Captive customers and transporters
Self-employed and salaried persons can jointly apply for a commercial vehicle loan with blood relatives or relatives. On the other hand, the partners of the collaborative partnerships and the directors of the limited partnerships can jointly request this loan.
What is the Eligibility Criteria to avail a Commercial Vehicle Loan ?
For New Commercial Vehicle:
- Salaried borrowers should have more than 2 years of employment stability and self-employed individuals must have at least 2 years of business experience.
- Private/Limited companies, partnership firms, trusts, societies and associations must be in existence for minimum 2 years.
- Fleet operators and other existing vehicle owners require to have 1 to 3 years of vehicle ownership proof of one or two commercial vehicles.
- Private/Limited companies, partnership firms, trusts & societies Companies need to provide 2 years of audited financials.
- Internal/external guarantor needed sometimes in case of individuals, first-time buyers and fleet operators/owners.
- The customers need to have minimum residential stability of 2 years. *(Borrowers with lesser stability are subjected to certain terms and conditions).
For Old Commercial Vehicle:
- Borrowers applying for a commercial car loan for old vehicles need to fulfil the following criteria along with the basic ones:
- Customers need to have relevant experience of 3 to 5 years depending on individual profile.
- Minimum 1 year of ownership of at least 2 vehicles.
- At least 1 year repayment track of commercial vehicles
No comments:
Post a Comment