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Old 15th May 2007, 13:26   #1
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Question Loan interest rates too high!

Hi all,
I called up RNS Motors, Yeshwanthpur for a quote for WagonR on finance and they quoted 14% interest with dealer finance Citibank. Is it too high. RNS yeshwanthpur do not have SBI as their partner in finance when asked they said SBI asks many documents for finance so they took them out. Now they deal only with Kotak,ICICI and Citibank(to which my salary credits are made).Will it be better to wait for some months for interest rates to come down . Will this interest rates ever come down say during November period of Diwali? What do i do? Please guide.

Regards,
Ramki.
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Old 15th May 2007, 14:34   #2
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Hey, talk to bank directly, chances ar that they will give you good deal. I have personally met ICICI guys and they agreed to give on 12% on mothly reducing.

~Bruty
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Old 15th May 2007, 14:48   #3
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Hi Ramky,

Check the thread on "How to get the lowest EMI" from the advice section. Its under the "Buying a car" sub-section. I am certain it will save you a lot of money!
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Old 15th May 2007, 14:54   #4
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Ramki,

I would suggest you to decide on the car and the price. Then approach the banks and ask them for the loan, compare the EMIs, choose the one which gives you the least EMI for the same period of time.
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Old 15th May 2007, 15:01   #5
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Sit at the table with the bank guys (Not DSAs) & thrash out an acceptable rate. ANything is possible if you put that extra effort. I brought down my EMI by 250 Rs by just talking to them about how prompt i will be in my payments etc.
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Old 15th May 2007, 15:25   #6
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Look at nationalized banks. Corporation Bank, SBI, Indian Bank, State Bank of Travancore. These guys have decent rates, are flexible with the partial repayments, have low penalty for preclosure. Only problem is they ask for a lot many documents than the Private banks and might take a bit more time. Its better to talk to people at the bank itself. If you know anyone in the banking circles get them to come with you. Bankers generally respect other bankers/ex-bankers. :-)
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Old 15th May 2007, 17:15   #7
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Default I got less

HI,
Even i tried for EMI at various banks which have tied up with the Dealerships.

Initially everybody quoted me a high intrest rate of 13.75 % to 14 %. I gave them left right and center and told them i don't want any private bank crap and they immediately gave me a new intrest rate of 13 %. This happened at Pratham motors on ORR. I also contacted Bimal Motors and initially they gave me the same deal but when i showed them quotation by Pratham they immediately brought it down.

SBI is giving intrest rate of 12.25 % floating and its a myth they require lot of papers . If u have a solid background in terms of tax and a health pay check they will give u loan easily and that too in a weeks time. Its a myth by private bankers who want their buseness to run. By the SBI is the biggest player in Auto Loans.

Thanks and Regards
SAurabh
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Old 15th May 2007, 17:47   #8
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11.75% seems to be the going rate after a lot of fighting. Since this would be our 5th auto loan with HDFC and I was able to have a word with one of the higher ups, they have offered 11.25% on the Swift VXI ABS. (much to the dismay of P. motors)

The national banks like SBI are the most straightforward and honest. Have settled with HDFC since its not a personal purchase.

Try and strike the best deal its your hard earned $ after all, Good Luck

Last edited by s0uljah : 15th May 2007 at 17:49.
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Old 15th May 2007, 18:06   #9
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One thing though. Talking directly to the bank does not help IMO. This I realized when I was shopping for a car loan. A manager with ICICI who looked after the car loans business told me (after we established some rapport based on my numerous accounts with them, my track record, my paycheck blah blah blah) that he will never be able to offer me anything less than the rack rates. In fact no one in the bank will be able to do so. He suggested that I approach the DSAs and play hardball with them. That is how the rates come down. The DSAs give you rates below the rack rates but banks don't.
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Old 15th May 2007, 18:20   #10
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Holy cow, two years back I got 7.3% with HDFC for my Baleno. At 13%-14% it really hurts to buy a new vehicle.
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Old 15th May 2007, 18:24   #11
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Quote:
Originally Posted by s0uljah View Post
they have offered 11.25% on the Swift VXI ABS.

The national banks like SBI are the most straightforward and honest. Have settled with HDFC since its not a personal purchase.

11.25% is a very good rate. Its almost comparable to the earlier prevailing rates. And HDFC is one of the more decent private banks.
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Old 15th May 2007, 18:34   #12
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Tata, Hyundai and Maruti have special schemes on select models. The interest rates range from 5.99% to 8.99%. Try to get that.
There is no finance discount though if you get that option.
Sadly these rates are available only in the super hot Santro/WagonR/Indica segment!
My advice to people who can wait.
Save like crazy for 2-3 months or whatever you wait, and take loan for the lowest amount.
15% interest rate is crazy
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Old 15th May 2007, 18:35   #13
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Lightbulb info....

guys..i just book a car i have a fair info on auto loan stuff

always get per lakh emi from bank to have an fair idea... 2210-2220 is what i am getting per lakh from hdfc bank its all how u negotiate i could have got bit more better but i gave up early i suppose

dont mix dealer discount and finance payout diff car segment carries diff payout options...

i was quoted initially 2390 per lakh

so talk to bank and dont hesitate to walk out if u are not comfortable on EMI you can speak to couple of branches of same bank

guys they also have targets and incentives associated with this...

Try in month end i did the same i cut the deal on 29th they rush to meet the target
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Old 15th May 2007, 19:01   #14
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Quote:
Originally Posted by Zappo View Post
One thing though. Talking directly to the bank does not help IMO. This I realized when I was shopping for a car loan. A manager with ICICI who looked after the car loans business told me (after we established some rapport based on my numerous accounts with them, my track record, my paycheck blah blah blah) that he will never be able to offer me anything less than the rack rates. In fact no one in the bank will be able to do so. He suggested that I approach the DSAs and play hardball with them. That is how the rates come down. The DSAs give you rates below the rack rates but banks don't.
That is the case with banks like ICICI. Its the DSA's who determine everything and at times screw your happiness by making large promises and following it up by making smooth excuses!!! Better to go to SBI, Corporation Bank etc.

Never believe the banks the car dealers have tied up with. The car dealers will push only for these banks. I remember Whitefield Honda actually trying to push ICICI/HDFC/Kotak onto me. I flatly refused. Even their senior manager came and told me that I shouldn't go to nationalized banks as they take time, more paperwork blah blah.

Best is to visit different banks and get everything sorted out. Play one against the other. Say SBI is giving so much, what's your best offer. Most of them reduce. Also try to reduce processing charges. I paid 0.5% only. Sometimes they quote anywhere from 2 to 5% depending on how desperate you are.
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Old 15th May 2007, 23:26   #15
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Quote:
Originally Posted by Samurai View Post
Holy cow, two years back I got 7.3% with HDFC for my Baleno. At 13%-14% it really hurts to buy a new vehicle.
And 2 years back (exact 2 years) I got roughly 6% for my car from ICICI.

And yes you can simply pit one against the other. Even the DSAs of the same bank. I was getting around 6.25% from a ICICI DSA as a final offer, the lowest till then. When I went to book the dealer had a ICICI guy at their showroom through whom they wanted to route the loan. However the guy quote 6.35% as a final offer. I deliberately played him off against the other DSA and fibbed that I am getting less than 6% and I am not having the loan through him. They tried a lot and then after several phone calls etc he came back with roughly 6% and said thats the lowest any DSA can ever give me. So I agreed after some dilly dallying. The moral being even the same bank's DSA undercut each other, particularly when the deal is at its last leg, to snatch business.
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