Fuel your passion: How Indians are financing classic cars
What's the story
In India, passion for vintage and classic cars has skyrocketed, driving up demand for specialized loans. These loans are not your regular car financing, they're for people who want to own a piece of automotive history. This blog post takes you on a ride through the world of financing for such cars in India, covering eligibility, interest rates, and everything else you need to know.
Eligibility
Understanding eligibility criteria
The key to getting a vintage or classic car loan is knowing what boxes you need to tick for the banks. You need to have a stable income and a good credit score The car needs to be old enough to be considered vintage or classic (most banks say at least 20 years) The vehicle has to be certified as a vintage or classic car by the recognized authorities.
Rates & terms
Interest rates and loan terms
Interest rates for vintage and classic car loans are significantly higher than those for new or used cars, due to the increased risk. Rates differ between lenders but typically fall between 10% and 15%. Loan terms are also shorter, usually not exceeding five years. It is advisable for borrowers to compare offers from several lenders to obtain the most favorable terms.
Documentation
Required documentation
Applying for a vintage or classic car loan entails providing a comprehensive set of documents. These encompass proof of income (salary slips, tax returns, etc.); identity proof (Aadhaar, PAN card, etc.); address proof; and complete details of the vehicle, including its make, model year, any restoration undertaken, and certification as a vintage or classic car.
Insurance
Insurance considerations
Insurance is crucial when financing a loan for a vintage or classic car; these vehicles are expensive and can cost a lot to restore if damaged. Most lenders would mandate a full-coverage insurance policy, which covers third-party liability and any damage to the vehicle itself. Due to their rarity, be prepared to pay higher insurance premiums for vintage and classic cars compared to regular vehicles.
Financing tips
Tips on securing financing
Securing financing for a vintage or classic car requires diligent research and preparation. Potential buyers should strive for a stellar credit score, as it greatly influences the interest rates offered by lenders. Have all your documents ready beforehand, and consider approaching banks with a specific focus on these loans for potentially better terms, thanks to their specialized knowledge.