Car Loan Calculator

Calculate your car loan EMI, down payment, and total cost for new and used cars. Includes detailed repayment schedule and interest breakdown.

About This Calculator

Car loans help you purchase your dream vehicle by financing up to 85% of the car's value. Our calculator helps you understand the EMI, down payment, and total cost involved in financing your car purchase.

The calculator considers different interest rates for new and used cars, helping you make an informed decision about your car financing options.

Car Loan Features:

  • Loan Amount: Up to 85% of car value
  • Tenure: 1 to 7 years
  • Interest Rates: 7.5% for new cars, 9.5% for used cars (approx.)
  • Processing Fee: 0.5% to 2% of loan amount
  • Prepayment: Usually allowed with minimal charges

New vs Used Car Loans:

  • New Cars: Lower interest rates, higher loan amount, longer tenure
  • Used Cars: Higher interest rates, lower loan amount, shorter tenure
  • Age Limit: Used cars typically up to 5-7 years old

Eligibility Criteria:

  • Age: 21 to 65 years
  • Income: Minimum ₹2.5 lakh per annum
  • Employment: Salaried or self-employed
  • Credit Score: 750+ for best rates

Features:

  • Calculate EMI for new and used cars
  • Down payment planning
  • Total interest and cost calculation
  • Outstanding balance tracking
  • Loan tenure optimization

Frequently Asked Questions

How much car loan can I get?

Banks typically finance 80-85% of the car's on-road price. The loan amount depends on your income - usually 3-6 times your annual income or where EMI doesn't exceed 40-50% of monthly income. For example, with ₹6 lakh annual income, you might get a car loan of ₹5-8 lakh. Your existing EMIs and credit score also affect eligibility.

What is the current car loan interest rate?

Car loan interest rates in India range from 7.5% to 12% per annum for new cars, and 9.5% to 15% for used cars (2026). Rates vary by lender, credit score, income level, and car model. Public sector banks like SBI offer rates starting at 7.5%, while private banks and NBFCs range from 8.5% to 12%. Compare offers from multiple lenders before deciding.

What is the minimum down payment for a car?

Most lenders require a minimum down payment of 15-20% of the car's on-road price. For a car costing ₹10 lakh, minimum down payment would be ₹1.5-2 lakh. However, making a larger down payment (30-40%) reduces your EMI burden and total interest cost. It also improves loan approval chances and may get you better interest rates.

Is car loan interest tax deductible?

Car loan interest is generally NOT tax deductible for personal vehicles in India. Unlike home loans, there's no tax benefit for car loans for individuals. However, if you're self-employed and use the car for business purposes, you may claim the interest as a business expense. For salaried individuals, car loans offer no tax benefits.

What is the maximum tenure for car loan?

Car loan tenure typically ranges from 1 to 7 years (12 to 84 months). While longer tenures reduce EMI, they increase total interest paid significantly. For new cars, 5-year tenure is common. For used cars, maximum tenure is usually shorter (3-5 years) due to vehicle age. Choose tenure based on EMI affordability while minimizing total interest.

Can I prepay my car loan?

Yes, car loans can be prepaid, but most banks charge prepayment penalties. Charges typically range from 2-5% of the outstanding principal if prepaid within the first 2-3 years. Some banks waive prepayment charges after a certain period. Check your loan agreement for specific terms. Prepaying early in the loan tenure saves more interest.

Should I buy a car with cash or loan?

Buy with cash if you have sufficient savings without compromising emergency funds and other goals. Cash purchase saves interest costs entirely. However, if you can invest the cash at returns higher than the loan interest rate (8-12%), a loan makes mathematical sense. Also consider that cars depreciate rapidly, so avoid large loans for depreciating assets if possible.

What credit score is needed for car loan?

A CIBIL score of 750+ is considered good for car loans and gets you the best interest rates. Scores between 650-750 may get approval but at slightly higher rates. Below 650, approval becomes difficult or requires higher down payment. Some lenders specialize in loans for lower credit scores but charge premium rates (14-18%).

What documents are required for car loan?

Standard documents include: Identity proof (PAN, Aadhaar), Address proof, Income proof (last 3 months salary slips, Form 16, bank statements), Employment proof, and Car proforma invoice. Self-employed individuals need additional documents like ITR for 2 years, business registration, and financial statements. Having documents ready speeds up approval.

Is it better to take car loan from bank or dealer?

Compare both options. Dealer financing is convenient and may offer promotional rates or zero-interest schemes, but often has hidden costs. Bank loans are transparent with clear terms. Always check the effective total cost including processing fees. Get quotes from both, then decide. Don't let dealer pressure you into their financing without comparing.