A vehicle loan is a financial service availed for:

• Buying a new 4-wheeler
• Buying a new 2-wheeler
• Purchasing an old 4-wheeler

A vehicle loan/vehicle finance can be applied for either individually or jointly with close relatives. Vehicle loans are secured loans where the vehicle itself acts as collateral.

Most of the rules and processes that apply to other loans also apply to vehicle loans. Please check the benefits, features, documents required, eligibility criteria, and interest rates before applying for a vehicle loan.

Own contribution (margin) means the total on-road cost of the vehicle minus the loan.

The on-road price of the vehicle includes Ex-showroom price, RTO registration, insurance and basic accessory cost.

The vehicle loan amount depends on various factors such as age, gross income, EMIs and other deductions, and the cost of the proposed vehicle. To check your monthly EMI for a vehicle loan, you can visit the Vehicle Loan EMI Calculator.

QUANTUM OF LOAN

• Minimum – No ceiling
• Maximum - as under:
  • New 4-wheeler - No ceiling
  • Old 4-wheelers (not older than 3 years) - Rs.20 Lakhs
  • New 2-wheeler - Rs.10 Lakhs

Vehicle loan interest rates are expressed as an annual percentage rate, or APR, and are ascertained by various criteria, including your credit score, debt, and income. The interest rate on a vehicle loan majorly depends on your CIBIL score. To find out how much interest on a vehicle loan is applicable, please visit our Interest Rate page.

EBLR stands for external benchmark lending rate. Union Bank of India has adopted the repo rate as the external benchmark to link its floating rate home loans with effect from 01.10.2019.

The external benchmark shall be reset at least once in three months or any other frequency as prescribed by the bank/RBI.

You can apply for a vehicle loan through any of the following methods –

Branch: You can visit our nearest branch and collect the application form from there and fill and submit it along with the processing fees cheque and other required documents. 

You can also download the application form from our website and fill and submit it at your nearest branch along with all the required documents and processing fees cheque.

Alternatively, you can apply online for a vehicle loan from the comfort of your home at the click of a button.

For approving the vehicle loan application, the Union Bank of India considers various other factors. Therefore, the CIBIL score alone is not the only criterion for getting the vehicle loan approved. However, an applicant with a higher CIBIL score is considered good. At present, a minimum CIBIL score of 700 is required by the Union Bank of India to consider the vehicle loan application for further processing.

No moratorium is permitted under the scheme.

For a borrower to understand the same better, there are two types of insurance covers available:

Vehicle Insurance: Mandatory as per the Motor Vehicle Act.

Liability Insurance or Life Insurance: This is optional and purely at the discretion of the borrower.