Therefore, choose a car that is within your budget. Lenders set minimum income needed for a car loan to make sure their customers can afford the purchase and the monthly payments that come with it. How much debt you already have will affect how much more you can take on. Some lenders take the co-applicant’s or spouse’s income into consideration. Monthly or annual income: As a potential borrower or car loan applicant, you should have a minimum annual income requirement of Rs.1.8 lakh or a monthly income of Rs.15,000. Here are some valuable tips that you can follow to ensure your car loan application is approved: In conclusion, being adequately prepared before applying for a car loan will ensure car loan approval. Your monthly debt payment should be less than 45% of your monthly income. A widely used budgeting equation is the 20/4/10 rule — which suggests that you spend 20% on a down payment, finance for four years and keep car costs (including loan payments and insurance) to 10% of your monthly budget. Here is a list of lenders and their minimum income requirement for a car loan: In the case of income of a borrower, every lender will have specific requirements which can be scouted by visiting their official websites or nearby branch office. That’s the minimum set by Auto Credit Express, and is typical of subprime auto loans, according to the site’s blog. While income requirements vary by lender, subprime lenders set a minimum monthly income of $1,500 for consumers with poor credit to qualify for an auto loan. Lenders generally won’t approve a loan that is for more than 20% of your monthly pre-tax income. A car loan is a secured loan; therefore, your credit score may not play as big a role as your income in determining whether you are eligible for a loan or not. *Self-employed individuals include those who own a private company or are directors of public limited companies in trading, service, or manufacturing business. Car loan eligibility online and apply for car loans that you are eligible for only on bankbazaar. Therefore, if your individual income doesn’t meet the criterion, you can include the income of your co-applicant or … 10000, SBI & HDFC Bank Rs.21000, Kotak Rs.15000 Generally, subprime lenders require you to make at least $1,500 to $2,000 a month before taxes from a single income source. Our main aim is to promote your business and brand. Chief among these requirements is a minimum monthly pre-tax income qualification, so that a lender is confident you can repay your loan. There are several car loan deals available to you but you should choose one that is within your repayment capability. This car affordability calculator is a free online tool to help you budget your car payment and find the most suitable car that comes within your budget. Affordability is one of the biggest considerations for a lender. Compensating factors can be a great credit score or an exceptionally low debt-to-income ratio. You should have at least 2 years’ work experience and minimum 1 year with the same employer. In general, lenders/dealers require at least $1,500 monthly income to qualify you for a car loan. Answer Save. The minimum monthly income requirement will vary from lender to lender. I was just wondering as my current car is very old and in case something happens i want to know is im stuck with buying another used car or a new car. Rs.3 lakh per year (including spouse or co-applicant). This is not an exhaustive list hence it is advisable to contact the lender to find out what other documents are required for your car loan application. What is the minimum income i must have to quality for a car loan? Your income – Maximum amount of car loan you will get is X times of your monthly income. A low minimum borrowing amount of $2,000 that you can use to purchase a new car or one up to two years old. Minimum income required Review the loan; Cash Converters: $300 per week: Review: Cash Train: $1,200 per month: Review: ClearLoans: No minimum: Review: Fair … A minimum annual income of Rs. In the event that the borrower doesn’t meet the minimum monthly income, a co-maker’s income … 8200, Dhanlaxmi Bank Rs. If you take on a car loan that is more than you can afford you have a higher chance of defaulting. Some lenders may approve low income earner if they have $1,500 monthly income. … There's no universal minimum monthly income for a car loan because it varies by lender, but most require you to make at least $1,500 a month before taxes. 1,80,000 is required: A minimum annual income of Rs. That being said, it is possible to qualify for a low income car loan. Finding out whether you are meeting the minimum income requirement for a car loan is part of this preparation. The credit score of the individual. NEW DELHI: State Bank of India has more than doubled the minimum income requirements for availing its car loans, worried its aggressive plan to tap the bottom of the car-buyers pyramid could saddle it with dodgy assets. If you’re on a tight budget but need a car ASAP, there are a few things you can do to improve your chances of getting approved for a loan. A big factor that comes into play here is your debt-to-income (DTI) ratio. In the case of self-employed individuals, at least 2 years’ experience in the same field of work or business. Monitor and work on improving your credit score; Seek in-house or dealership financing (these lenders are more flexible). When it comes to income, here are a few ways lenders determine if you qualify for a car loan: This number varies from lender to lender, but generally you will need to make $1,500 to $2,000 a month before taxes to get a bad credit car loan. However, other types of car finance usually use the vehicle as security, meaning the lender often owns the car until you make the final payment – and has a right to take it back if you don't pay.