Federal Bank Car Loan Interest Rates
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Federal Bank Car Loan Interest Rates

Team CARS24
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Est. Reading Time:
5 mins

Federal Bank Car Loan Interest Rates

Team CARS24
editor

Federal Bank Limited is one of the more popular commercial banks of the private sector in India today. It has more than 1200 beaches and almost around 1000 ATMs located in strategic spots of the country. The Federal Bank of India was formed on April 21, 1931, when it started life as the Travancore Federal Bank Limited, Nedumpuram under the Travancore Companies Regulation, 1916. Like other major banks, this bank offers car loan from as low as 9.05% rate of interest (for new cars) along with a repayment tenure of up to 84 months. Moreover, the bank offers up to 100% of the ex-showroom price of the new car as a loan amount

FeaturesNew Car LoanUsed Car Loan
Loan TenureUpto 7 years Upto 5 years 
Lowest EMI₹ 1,584 per lakh₹ 2,052 per lakh
Loan AmountUpto 100% of ex-showroom priceUpto 75% of depreciated value
Prepayment Charges2%2%

Federal Bank Car Loan Eligibility Criteria

Like every bank in existence, the Federal Bank has set criteria for giving ar loans. All banks have set criteria for verifying the eligibility of a loan applicant. The factors that go on to have an important role in verifying the eligibility criteria include many things, like the age of the borrower, his annual income, credit score, the tenure of loan and even the loan to value ratio. The table given below lists out all the criteria that have a direct effect on the eligibility criteria of a loan applicant at Federal Bank. 

Eligibility Criteria Eligibility Details
Age 21 years – 65 years
Minimum Annual Income Salaried: ₹ 1 Lakhs
Self Employed Professionals: ₹ 0.60 Lakhs
Self Employed Businessmen: ₹ 0.60 Lakhs
Minimum Credit Score 700 and above
Loan Tenure 5 years
Loan to Value Ratio 90% of ex-showroom price

Federal Bank Car Loan EMI Calculator

In simple words, the Federal Bank Car Loan EMI is the sum of money the borrower will have to pay to the bank through monthly instalments on a pre-defined date. Seen below is a list of factors that determine the EMI – 

  Factors Determining EMI
Rate of interest A high rate of interest leads to a higher EMI
Loan tenure A higher loan tenure will lead to a lower EMI
Loan Amount The higher the loan amount, the higher will be the EMI

As soon as you become aware of the Federal Bank car loan interest rate to be charged to you, you can quickly determine the EMI through a free Federal Bank car loan EMI Calculator. To use an EMI calculator, you simply need to enter the loan amount, the rate of interest and the loan tenure and he can immediately get to know the EMI he will have to pay every month. All the EMI calculators work on a standard principle equation

E= P. r. (1+r)n/[(1+r) n -1]

Where,

P is the principal amount (loan amount)

r is the rate of interest per month which is calculated as rate of annual income/ (12*100)

n is the tenure of the loan in months

E represents the monthly payment or EMI

Federal Bank Auto Loan Fee and Charges

All banks have some standard charges on the processing of a loan. These charges include two components – foreclosure penalty and processing fee. The foreclosure penalty is levied on the loan applicant in case one needs to pay back his loan, in part or in full, earlier than its maturity. On the other hand, the processing fee is levied when the bank issues you the loan. The Federal Bank auto loan fee and charges have been given below –

Foreclosure Charges These charges are to be paid in case you want to repay your entire loan amount before the end of tenure period. Federal Bank allows prepayment of vehicle loan after paying 1 EMI with prepayment Not allowed for 6 months; 5.21% charges after 6 months.
Processing Fee Federal Bank asks for a processing fee of Min. ₹ 3,300 and Max. ₹ 4,750 with applicable service tax.

How can I Transfer my Federal Bank Car Loan Balance?

You can transfer your Federal Bank car loan balance from another bank. However, the availability of this feature depends on your eligibility and so, you should visit the nearest Federal Bank branch and check your eligibility. Once it’s for sure that you can initiate the transfer process, you can start the paperwork.

How can I top up my Federal Bank Car Loan?

You can top up the car loan once you’ve checked your eligibility for doing so. You can check this at any Federal Bank branch that has a car loan department.

Documents required for Federal Bank Car Loan

To get a car loan, the applicant needs to first submit a set of documents to Federal Bank. These documents are required by the bank to analyze the loan application and process it accordingly. Also, it must be noted here that the requirement of the documents differs from a salaried employee to a self-employed professional. Below, we have a table that contains the details of the documents one needs to share with Federal Bank when applying for a car loan- 

Type of Employment Documents Required
For Salaried Individuals Minimum age to apply: 21 years; Maximum permissible age at loan maturity: 58 years; Minimum annual income: Rs.3 lakhs (3 months’ salary slips/ Form 16 needed for confirmation); Minimum work experience in current job: 1 year
Self Employed Individuals Minimum age to apply: 21 years; Maximum permissible age at loan maturity: 65 years; Minimum annual income: Rs.2 lakhs (2 years ITR/ Previous year ITR with adv. tax challan for current year showing higher tax paid than previous year, needed for confirmationMinimum experience in same business: 2 years.
Partnership Firms Minimum Annual Income: Rs.2 lakhs (2 years Audited Financials / ITR for last 2 years if audited financials not available are needed for confirmation). Minimum experience in same business: 2 years.
Private Limited Company/ Ltd. Co. Minimum Annual Income: Rs.2 lakhs (Last 2 years ITR & Audited Financial statement needed for confirmation). Minimum experience in same business: 2 years

Factors Affecting Federal Bank Car Loan Interest Rates

The interest rate at which a Federal Bank car loan is provided to an individual is decided through a set of factors. It must be noted that the Federal Bank car loan rates start as low as 7.35 per cent per annum. Given below is a list of all the factors that help the bank figure out the interest rate that it charges to the loan applicant:

Loan amount The bigger the loan, the lower is its interest rate
Your Salary Higher the earning, lower the interest rate.
Employer Category The employment category makes a huge difference on the rate of interest at which one gets the loan.
Relationship with the Bank Existing customers of Federal Bank with a good reputation in terms of repayment history can get car loans at slightly lower rates
Loan Tenure Federal Bank offers new car loans with a loan period of 7 years.
Repayment Capacity Federal Bank checks the repayment history through the CIBIL score

FAQs

 

 

Q: How do I calculate the EMI of my car loan?

 

A: You can calculate the EMI using a tool on the official website of Federal Bank.

 

Q: What should the age of the used car be in case of used car loans?

 

A: In the case of a used car loan, the vehicle age should not be more than 3 years.

 

Q: How is the depreciation value computed with respect to used cars?

 

A: The depreciation value of a used car is calculated using Straight Line Method at 15% for the first year and 10% for subsequent years.

 

Q: What are the documents that resident salaried individuals are required to submit?

 

A: A salaried individual working in India needs to submit the below documents for availing of the Federal Bank car loan – 
– Pay slips for the preceding 3 months
– Form 16 or IT return copies for the preceding 2 years
– Bank account statement for the last six months

 

Q: Do I have to submit any age proof while availing the car loan?

 

A: For availing of the Federal Bank car loan, one needs to submit any one of the following age proofs:
– Birth certificate
– Passport
– Driving license
– AISSE or SSLC certificate