Tata Motor Finance- 5.99% ????

[mohit333]

Was at Shaman Auto in Mumbai yest to get my car serviced. They had put up banners screaming interest rates for certain models of Tata Indica/ Indigo and Palio Stile @ 5.99% . Thats bloody cheaper than the market rates. Should definitely give a boost to their sales.

Wonder y thr hasnt been any advertisements regarding the same.

Regards

Mohit
Palio 1.2EL/Mar'04/75,263km

[deepak_ms]

in bangalore tata where offering 5.99% only on Indica xeta...

[pawan_pullarwar]

There was a add in Pune Sakal. Indica Xeta at 2.5% interest rate.

[rkg]

that is flat rate. it almost equal to 12% bank rate. rule of thumb 1 % bank rate is = 1.9% flat rate ( approximately)

[abhilashvk]

How do they manage such a low rate? The market rate for a private bank is around 14%. I am sure there should be some catch there like processing charges....

[Zappo]

There are two possibilities in this.

1. They are hiding facts, or giving incomplete info. When you enquire they will tell you that it is a flat rate of interest (as against monthly or daily reducing). That will immediately send the equivalent reducing balance rate shooting skywards. The longer the loan repayment period the more you bleed.

2. Now this could be interesting. To jack up the demand, particularly in a falling market, companies tie up with banks/finance houses. They give you a really lucrative offer on EMIs and make you to buy the car even though you were not so sure of it at that time. Maruti, Hyundai are all known to do this. Tata Finance being their own group company it is all the more easier for them to arrange such deals. In return they remove all the other discounts that you would have otherwise received. This includes cash discount/ finance discount, dealer discount, free accessories, insurance etc.

If you work out the figures you will realise that whatever you save in the lower EMI because of a lower ROI you anyhow loose in terms of vanishing discounts and other freebies.

[sithon]

In Bangalore, they have it low and also can provide it for the palio (but not as low as 5.99% of course for the palio) but they mentioned it is for 3 years - will confirm details later this week.

[mohit333]

My dad told me that it may be due to the cheap funds they are getting from world bank(approx rs 2000 crore) for some project.. Not sure bout this though. I have a cousin at Tata Motor Finance. Will email him and let you'll know in a day or two.

Regards

Mohit

[Zappo]

Originally Posted by mohit333

My dad told me that it may be due to the cheap funds they are getting from world bank(approx rs 2000 crore) for some project.. Not sure bout this though. I have a cousin at Tata Motor Finance. Will email him and let you'll know in a day or two.

Regards

Mohit

What? You mean world bank is financing them to fund Tata car loans? I hope the world bank chairman does not read this, lest the guy hangs himself with a rope...

[sithon]

update:
So here's what is being offered from Concorde (Bangalore) for the palio 1.6 stile:

[COLOR=navy][FONT=Arial]Fiat 1.6 stile [/FONT][/COLOR]
[COLOR=navy][FONT=Arial] [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]INV PRIC 434848[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]INS 16471[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]LTT 47835[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]REG 3000[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]EXTENDED WARRENTY (4200 not charged) [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]ON ROAD[/FONT][/COLOR][FONT=Times New Roman][SIZE=3] [/SIZE][/FONT][COLOR=navy][FONT=Arial]502154[/FONT][/COLOR]
[COLOR=navy][FONT=Arial] [/FONT][/COLOR]
[COLOR=navy][FONT=Arial] [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]3 YEARS 0R 35 MONTHS @ 8.99% [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]FINANCE AMOUNT 250000[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]EMI IN ADV from icici 7893[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]STAMP CHARGES 1700[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]NET AMOUNT DISPERS 240408[/FONT][/COLOR][COLOR=navy][FONT=Arial] [/FONT][/COLOR]
[COLOR=navy][FONT=Arial] [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]DOWN PAYMENT 261747[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]Rs 4000/- spl discount 4000[/FONT][/COLOR]
[COLOR=navy][FONT=Arial]NET PAYABLE AS D/P 257747[/FONT][/COLOR]
[COLOR=navy][FONT=Arial] [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]DOCKS REQUAIRED for Reg [/FONT][/COLOR]
[COLOR=navy][FONT=Arial][/FONT][/COLOR]
[COLOR=navy][FONT=Arial]ADD PROOF [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]PAN CORDE COPE [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]5 PHOTOS [/FONT][/COLOR]
[COLOR=navy][FONT=Arial] [/FONT][/COLOR][COLOR=navy][FONT=Arial] [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]DOCKS REQUAIRED FOR FINANCE [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]2 YEARS FORM 16 [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]PAN COPE [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]2 MONTHS PAYSLIP [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]ADDRES PROFF [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]6 MONTHS BANKING [/FONT][/COLOR]
[COLOR=navy][FONT=Arial]P D C [/FONT][/COLOR]

So this is what is the down to figures info for the ad seen in the papers.
Any comments on this from the Team BHPians?

[deepak_ms]

from yesterday am seeing new Ad that says 1% Flat rate for Xeta Car..

[wolfinstein]

Nothing at least in my case, I opted for TATA motors finance at 7 %.

The reason is because its a Motor Finance Company for only TATA Products, They get out discounted rates.

Seriously, No catch till last year-Don't know if they changed it !

[rags]

Originally Posted by rkg

that is flat rate. it almost equal to 12% bank rate. rule of thumb 1 % bank rate is = 1.9% flat rate ( approximately)

its actually 2 % reducing balance is approximately 1 % flat

banks / financiers normally charge the same interest for all vehicles
the interest if subvented by the manufacurer and the dealer from his profit margin

[madan80]

I had the same question myself. How can they be screaming such low rates, unless as it has been pointed out, is flat and not diminishing. If thats the case, then it is very cunning on there part.