[Turbanator]

Which is better option, to buy a car on full cash payment or take loan ?

well if you can't save enough and always tend to spend then buy on Loan, it will be kind of forced savings even though you might end up getting 50-60 % at end of tenure. This also holds good if you are into stocks or something where you can get more returns than your interest obligation.

[libranof1987]

Originally Posted by roby_dk

Which is better option, to buy a car on full cash payment or take loan ?

In the current scenario, paying 20 lakhs for the car up front in cash might raise eyebrows with the IT dept.

You might want to factor that in based on the source of the said 20 lakhs.

[roby_dk]

Originally Posted by born_free

A loan on depreciating asset will always cost you more in long term.

Yes even I was thinking the same.

Originally Posted by Turbanator

well if you can't save enough and always tend to spend then buy on Loan, it will be kind of forced savings even though you might end up getting 50-60 % at end of tenure. This also holds good if you are into stocks or something where you can get more returns than your interest obligation.

I do not have much knowledge of stocks so didn't applied directly in them although I have monthly SIP in ELSS scheme.

Originally Posted by libranof1987

In the current scenario, paying 20 lakhs for the car up front in cash might raise eyebrows with the IT dept.

You might want to factor that in based on the source of the said 20 lakhs.

It is our hard earned white money all in my salary account. I don't think IT people will keep eye on such transactions.

[auto_enthusiast]

Originally Posted by roby_dk

Off Topic:
I am planning to buy a car soon within 15-20L bracket.

Which is better option, to buy a car on full cash payment or take loan ?

Can someone provide pros and cons between above two payment options.

If Loan is better option how much % of loan should be taken?

Invest the amount in a FD and take a loan against it. It will cost you just 1% over and above what you would be earning as interest on the FD. Suppose the interest on FD is 8%, the bank will eventually charge you only 9% on the car loan against that FD.

That way you will be compelled to save. The other benefit is your loan amount will gradually reduce over a period of time and at the same time the principal + interest on the FD will accumulate in to a big amount whenever it matures.

Also if you go for a loan of say 10L, then instead of making a single FD of the total amount, make 5 FDs of 2L each(in a single name or multiple names). The benefit of this is as and when you repay the loan and your outstanding loan amount reduces by 2L, your one FD will be free of bank charge. In case of any contingency, you can use this freed FD to meet your requirement and if it is not required let the FDs earn interest

[balajisv]

Originally Posted by auto_enthusiast

Invest the amount in a FD and take a loan against it. It will cost you just 1% over and above what you would be earning as interest on the FD. Suppose the interest on FD is 8%, the bank will eventually charge you only 9% on the car loan against that FD.



That way you will be compelled to save. The other benefit is your loan amount will gradually reduce over a period of time and at the same time the principal + interest on the FD will accumulate in to a big amount whenever it matures.



Also if you go for a loan of say 10L, then instead of making a single FD of the total amount, make 5 FDs of 2L each(in a single name or multiple names). The benefit of this is as and when you repay the loan and your outstanding loan amount reduces by 2L, your one FD will be free of bank charge. In case of any contingency, you can use this freed FD to meet your requirement and if it is not required let the FDs earn interest

Fantastic idea! I wasn't aware that Banks would lend at a 1% higher rate against the invested FDs.

Also, in today's market scenario, the FDs are offered at 7% PA interest.

[roby_dk]

Originally Posted by auto_enthusiast

Invest the amount in a FD and take a loan against it. It will cost you just 1% over and above what you would be earning as interest on the FD. Suppose the interest on FD is 8%, the bank will eventually charge you only 9% on the car loan against that FD.

Wow that sounds really nice. Not sure if this can be done easily. Do we have someone who has followed same procedure successfully without much efforts?

[Motard_Blr]

Originally Posted by roby_dk

Wow that sounds really nice. Not sure if this can be done easily. Do we have someone who has followed same procedure successfully without much efforts?

There's a thread for this: http://www.team-bhp.com/forum/indian...-deposits.html

The same topic has also been discussed on other threads on car loans.

[BKN]

Originally Posted by vijayvelprakash

Any on going offers for Honda Cars in Bangalore?

One of my colleagues is planning to by City SV version. He is getting a Cash Discount of 35K + Free insurance. They are ready to offer him some accessories for free or at discounted price. Hope this helps.

[born_free]

Just returned from NEXA showroom in Gurgaon, the discounts on all variants of S-Cross (including 1.6L engine) is as follows.
Exchange bonus: 40K
Corporate Discount: 10 K.
No additional discount given even though I was a potential customer. The exchange price quoted for my Wagon R was ridiculously low. Have decided not to go for exchange and wait out for couple of months as I am in no hurry.

[ashishs]

Originally Posted by BKN

One of my colleagues is planning to by City SV version. He is getting a Cash Discount of 35K + Free insurance. They are ready to offer him some accessories for free or at discounted price. Hope this helps.

There could be a little more scope for negotiations. I was negotiation a deal where there was a cash discount of 70k plus a few accessories for the V varient in Delhi.

[cdmanju]

Originally Posted by vijayvelprakash

Any on going offers for Honda Cars in Bangalore?

There is 60k cash discount across all variants of 2015 manufactured cars. And free insurance on the 2016 manufactured cars.

Not sure how safe it is to buy 2015 cars. However if you are good at negotiating, you should be getting a great deal considering the time of the year and cash crunch situation.

If you are planning to visit a showroom to negotiate a deal, please take another smart person along with you. Additional brain will help during the negotiations )

thanks,
Manjunath

[chakri400]

Originally Posted by cdmanju

There is 60k cash discount across all variants of 2015 manufactured cars. And free insurance on the 2016 manufactured cars.



Not sure how safe it is to buy 2015 cars. However if you are good at negotiating, you should be getting a great deal considering the time of the year and cash crunch situation.



If you are planning to visit a showroom to negotiate a deal, please take another smart person along with you. Additional brain will help during the negotiations )



thanks,

Manjunath

We checked for BRV last week. Dealer called today and offered a 1 lakh additional exchange bonus. We didn't even start negotiations.

[cdmanju]

Originally Posted by chakri400

We checked for BRV last week. Dealer called today and offered a 1 lakh additional exchange bonus. We didn't even start negotiations.

WoW., 100k discount is a great number. Wish you best of luck on the negotiations and do let us know how things go. It might help others here on this forum. I'm also considering a Jazz for my daily commute

[aashishnb]

Originally Posted by balajisv

Fantastic idea! I wasn't aware that Banks would lend at a 1% higher rate against the invested FDs.

Also, in today's market scenario, the FDs are offered at 7% PA interest.

There's one flea in the ointment, since you are buying a 20l car, one cab safely assume you are in the top tax bracket of 30%++.

Therefore, your FD interest income will be taxed at full rate while you will not get any benefit from the car loan as you are a salaried employee. This will make the effective difference in your hand is 3%+ (1% diff in interest rate and 2+% as tax on the 7% you earn).

My suggestion, if you are an impulsive buyer, go for FD+loan option to keep up the discipline.
If you are already disciplined, hi did down payment & start saving/recurring deposit/SIP for the amount for would have otherwise paid as EMI.

[born_free]

Any discount on Ford Ecosport Titanium Plus Diesel Variant?
Since ford has reduced price already to compete with Brezza, likelihood of another round of discount seems to be less.