How much down payment is generally the norm when opting for a used car loan?
The down payment for used car loans is usually fixed at 15% of the assessed value of the car as a bare minimum. Depending on the estimated price, the bank decides on the amount of loan. Usually a loan amount of 80% of the on road price of the car as estimated by the expert is approved. Banks and NBFC’s deduct a margin money amount for registration, insurance and accessories while assessing the final on road estimated price of the used car.
The down payment for Used Car Loans is typically fixed at 20-40% of the assessed value of the car, depending on the car’s model and your financial situation. However, compared to loans for new cars, it is generally easier to get a waiver on prepayment penalties on Used Car Loans, should you choose to close your loan in advance.
It is always better to make the maximum possible down payment to avoid increasing the overall cost of ownership of the car.