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Key Features of Union Bank of India Car Loans

  • Loan Amount:
    - New Cars: Financing of up to 90% of the on-road price of the car.
    - Used Cars: Financing of up to 85% of the on-road price, depending on the car’s age and condition.
  • Loan Tenure:
    - New Cars: Maximum repayment tenure of up to 7 years (84 months).
    - Used Cars: Loan tenure of up to 5 years (60 months).
    - Flexible tenure allows borrowers to choose based on their financial capacity.
  • Interest Rates:
    - Floating interest rates typically range from 8.50% to 9.50% per annum.
    - Final rate depends on factors like applicant profile, loan amount, and tenure.
  • Processing Fee:
    - A nominal processing fee is charged, usually between 0.50% to 1% of the loan amount.
    - May vary based on the type of car (new or used) and loan size.
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    • No Prepayment Charges: Union Bank of India does not charge penalties or prepayment fees if you repay your loan early.This helps reduce your total interest burden significantly.
    • Loan for Both New and Used Cars:
      - New Cars: Loans available for all types of new passenger vehicles including SUVs and MUVs.
      - Used Cars: Vehicle should not be more than 5 years old at the time of loan application.
    • Attractive EMI Options: Flexible EMI plans allow you to select a repayment amount that fits your monthly budget. Use the online EMI calculator to estimate your monthly payment.
    • Quick Loan Processing: Fast approval and disbursal process ensures timely access to funds. Loans can be approved within a few working days, subject to complete documentation.
    • Attractive Loan-to-Value (LTV) Ratio:
      - New Cars: Up to 90% of the on-road price.
      - Used Cars: Up to 85%, based on car condition and age.
    • No Guarantor or Collateral Required: No separate guarantor or additional collateral required. The car itself acts as security for the loan.
    • Flexible Eligibility Criteria: Loans are available for salaried individuals, professionals, and self-employed persons. Factors like age, income, and credit score are considered.
    • Special Schemes for Women: Exclusive benefits like reduced interest rates and processing fee discounts are available for women applicants.
    • Easy Documentation: Simple and hassle-free process with the following required documents:
      - KYC: Aadhaar, PAN, Passport, etc.
      - Address Proof: Utility bills, Voter ID, etc.
      - Income Proof: Salary slips, ITR, bank statements.
      - Car-related documents: Invoice or inspection report (for used cars).
    • Loan for Individuals and Joint Borrowers: You can apply individually or with a co-applicant to improve loan eligibility. Co-borrower with a good income/credit score boosts approval chances.
    • Loan for NRI Applicants: NRIs can also avail car loans subject to additional requirements like a valid visa or work permit.
    • Top-Up Loan Facility: Existing borrowers can avail top-up loans for additional funds, based on repayment history and eligibility.
    • Car Insurance: Union Bank offers tie-ups with leading insurers to provide car insurance throughout the loan term. Insurance is mandatory and can be availed through the bank or independently.
    • Online Application and Tracking:
      - Online: Apply conveniently via Union Bank’s website or mobile app.
      - Tracking: Monitor the application status online post submission.
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Benefits of Choosing Union Bank Car Loan

  • High Loan-to-Value (LTV) Ratio: Union Bank finances up to 90% of the on-road price for new cars and up to 85% for used cars, helping you minimize the upfront payment.
  • Competitive Interest Rates: Attractive floating interest rates starting from 8.50% per annum, ensuring affordable EMIs and lower overall repayment compared to other lenders.
  • Flexible Loan Tenure: Choose a repayment term that suits your financial situation—up to 84 months (7 years) for new cars and up to 60 months (5 years) for used cars.
  • No Prepayment Penalties: Union Bank allows you to repay your car loan early without any prepayment or foreclosure charges, helping you save on interest.
  • Easy Loan Processing and Quick Disbursal: The loan processing is simple and quick, with approval often granted in a few business days. Once approved, the funds are disbursed rapidly.
  • Minimal Documentation: Union Bank requires basic documents including KYC (Aadhaar, PAN, etc.), income proof (salary slips, bank statements), and car-related documents.
  • Loan for Both New and Used Cars: Loans are available for new vehicles and used cars up to 5 years old. Financing can cover up to 90% for new cars and 85% for used cars, depending on eligibility.
  • Special Schemes for Women: Women applicants enjoy lower interest rates and special benefits, encouraging financial independence through affordable auto financing.
  • Joint Borrower Facility: Apply with a co-applicant to increase eligibility and improve chances of approval, especially beneficial when the co-applicant has a stable income and good credit history.
  • Loan for NRI Applicants: Non-Resident Indians can apply for car loans with Union Bank, provided they meet the documentation and eligibility requirements including visa/work permit proof.
  • Insurance and Additional Benefits: Union Bank offers car insurance in collaboration with leading insurers, ensuring complete protection for your car during the loan tenure.
  • Top-Up Loan Facility: Existing car loan customers can apply for a top-up loan to cover additional expenses like accessories, insurance, or personal needs.
  • Online Loan Application: Apply through Union Bank’s website or mobile banking app, with options for document upload and application tracking from your home.
  • No Hidden Charges: Union Bank provides complete transparency on fees and charges. All costs, including processing fees, are clearly communicated upfront.
  • Car Loan for All Types of Vehicles: Finance your choice of vehicle, including passenger cars, SUVs, and MUVs, with tailored loan options for each category.
  • Tax Benefits: If the car is used for business purposes, the loan interest may qualify for tax deductions under Section 80C of the Income Tax Act.
  • Flexible EMI Options: EMI plans can be adjusted based on your repayment capacity. Use Union Bank’s EMI calculator to estimate payments based on tenure and interest rate.
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How to Apply for a Car Loan in Union Bank of India

  1. Check Eligibility:
    • Age: Minimum 18 years; Maximum age at loan maturity is usually 75 years.
    • Employment: Salaried, self-employed, professionals, pensioners, or business owners.
    • Income: Must have a steady source of income to show repayment capability.
    • Credit Score: Preferably 700 or above for better approval chances.
  2. Decide the Loan Amount and Car Model:
    • Choose the car you want to buy.
    • Get a quotation or proforma invoice from the dealer.
    • Calculate the on-road price and determine the loan requirement and down payment.
  3. Apply Through Online or Offline Channels:
    • A. Offline (Visit Branch):
      • Visit the nearest Union Bank of India branch.
      • Ask for and fill out the Car Loan Application Form.
      • Submit the filled form with required documents.
    • B. Online Application:
      • Visit Union Bank's official website.
      • Go to "Loans" > "Retail Loans" > "Vehicle Loans".
      • Click on "Apply Now" and fill out the online form.
      • Upload documents and submit the application.
  4. Submit Required Documents:
    • Identity Proof: Aadhaar, PAN, Passport, Voter ID, or Driving License.
    • Address Proof: Aadhaar, Utility Bills, Passport, or Rental Agreement.
    • Income Proof:
      • Salaried: Last 3 salary slips, Form 16, 6 months bank statements.
      • Self-Employed: ITRs for last 2-3 years, Balance Sheet, Bank Statements.
    • Other Documents: Car quotation/proforma invoice, photos, application form.
  5. Wait for Loan Processing and Approval:
    • Bank will evaluate your application, credit score, and documents.
    • If eligible, a sanction letter with interest rate, tenure, and EMI details will be issued.
  6. Loan Disbursement:
    • Upon approval, the loan amount is disbursed directly to the car dealer.
    • Proceed with car registration and insurance after disbursement.
  7. Start Loan Repayment:
    • EMI begins as per the repayment schedule.
    • Repayment can be made via auto-debit, ECS, or post-dated cheques.

Eligibility Criteria for Car Loans in Union Bank of India

  • Age Criteria:
    • Minimum Age: 18 years at the time of loan application.
    • Maximum Age: 75 years at the time of loan maturity.
  • Eligible Applicant Categories:
    • Salaried Individuals:
      • Must be employed with a reputed organization (government or private).
      • Minimum of 2 years of continuous employment.
      • Steady monthly income as per bank's minimum requirement.
    • Self-Employed Individuals / Professionals:
      • Includes doctors, lawyers, CAs, architects, traders, business owners.
      • Should have 2–3 years of experience in the same business/profession.
      • Must provide ITRs, bank statements, and financial documents.
    • Business Entities:
      • Partnership firms, LLPs, companies intending to buy vehicles for official use.
      • Should have an operational history of at least 2–3 years with sound financials.
    • Pensioners:
      • Eligible if drawing regular monthly pension.
      • EMI should be affordable within pension income limits.
  • Minimum Income Requirement:
    • For salaried individuals: Minimum monthly income of ₹15,000 to ₹20,000 (varies).
    • For self-employed: Sufficient profit or turnover as per Union Bank guidelines.
    • For pensioners: Monthly pension must comfortably support EMI payments.
  • Credit Score and Credit History:
    • Preferred credit score is 700 or above for better chances and interest rates.
    • Clean repayment history increases chances of approval.
  • Co-applicant Option:
    • Co-applicants like spouse, parent, or close relative can be added.
    • Improves eligibility and increases the loan amount.
  • Vehicle Criteria:
    • Applicable for brand-new cars, used/pre-owned cars (up to 3–5 years old), and EVs.
    • Vehicle must be purchased from an authorized dealer or recognized seller.
  • Residential Stability:
    • Applicant should have a stable residence history (typically 1 year or more).
  • Bank Account (Preferable):
    • Having a salary or savings account with Union Bank helps in faster processing.
    • Existing customers may enjoy concessions or priority service.
  • Margin Requirement:
    • Applicant must pay a margin of 10%–15% of the car’s value as down payment.
    • Remaining amount is financed by the bank.
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Documents Required for Car Loan in Union Bank of India

  • Identity Proof (Any One of the Following):
    • Aadhaar Card, PAN Card(Mandatory for most high-value transactions)
    • Passport, Voter ID
    • Driving License
    • Government-issued photo ID card
  • Address Proof (Any One of the Following):
    • Aadhaar Card
    • Electricity / Water / Gas Bill (not older than 3 months)
    • Passport,Ration Card , Driving License
    • Registered Rent Agreement
    • Bank Statement showing address
  • Income Proof:
    • For Salaried Individuals:
      • Latest 3 months’ salary slips
      • Form 16 or ITR for the last 2 years
      • Salary account bank statement (last 6 months)
      • Employment certificate or appointment letter (if applicable)
    • For Self-Employed / Professionals:
      • ITRs for the last 2–3 years
      • Bank statements (business account) – last 6 months
      • Balance Sheet and Profit & Loss Statement (CA certified)
      • GST Registration Certificate / Business License
      • Professional qualification certificate (for doctors, lawyers, etc.)
  • Vehicle-Related Documents:
    • Proforma invoice or quotation from authorized dealer
    • Vehicle details – model, make, ex-showroom price
    • Insurance details (post loan approval)
    • RC Book copy (for used vehicles)
  • Photographs: 2–4 recent passport-sized photographs matching the photo ID submitted.
  • Application Form: Duly filled and signed Union Bank Car Loan Application Form. Ensure all details are correct to avoid delays.
  • Signature Verification Proof:
    • Banker’s verification
    • Cancelled cheque
    • Signature as per bank records
  • Proof of Business (For Self-Employed/Business Owners):
    • Business Registration Certificate
    • Trade License / Shop Act License
    • Partnership Deed or Incorporation Documents (if applicable)

Factors Considered for Union Bank

When applying for a car loan from Union Bank of India, several key factors are taken into account to determine your eligibility and ensure timely repayment. These include:

  • Applicant’s Age:
    • The applicant should be at least 18 years old at the time of applying.
    • The upper age limit typically goes up to 75 years at loan maturity, depending on the applicant's profile.
  • Employment Status and Income:
    • Salaried Individuals: Must have a stable income with at least 2 years of work experience.
    • Self-Employed/Professionals: Should be in business or practice for at least 2–3 years.
    • Pensioners: May also be considered based on their pension income.
    • Minimum monthly income is considered to ensure repayment capacity. The bank may require income proof like salary slips, IT returns, or bank statements.
  • Credit Score and History:
    • A good credit score (usually 700 or above) is essential.
    • The bank reviews your credit history, repayment behavior, and any past loan defaults.
    • A strong credit report enhances your chances of loan approval and better interest rates.
  • Loan Amount and Vehicle Type:
    • The bank finances both new and used cars, although terms may vary.
    • Loan amount is based on ex-showroom price (for new cars) or valuation report (for used cars).
    • Generally, up to 85%-90% of the vehicle cost can be financed.
  • Repayment Capacity: Union Bank assesses your ability to repay based on monthly income, existing EMIs, and overall financial obligations. A lower Debt-to-Income Ratio (DTI) increases the likelihood of approval.
  • Margin Requirement: The borrower must contribute a certain percentage of the car’s cost as a margin/down payment. For new cars, it’s usually around 10%-15%, depending on the loan scheme.
  • Loan Tenure: The maximum repayment period offered is generally up to 7 years (84 months). A longer tenure reduces EMI but increases interest outgo.
  • Documentation: The bank requires specific documents such as:
    • Identity and address proof (Aadhaar, PAN, Passport, etc.)
    • Income proof (ITR, salary slips, Form 16)
    • Bank statements (last 6 months)
    • Vehicle quotation/proforma invoice
  • Guarantor or Co-Applicant (if required): In some cases, the bank may require a co-applicant or guarantor, especially if the applicant has low income or borderline credit score.
  • Relationship with Bank: Existing customers with a good transaction history may get preferential rates, faster processing, or relaxed norms. Having a salary or savings account with Union Bank of India can be an added advantage.

FAQs On Union Bank Car Loans

Who is eligible for a Union Bank car loan?
Any Indian resident including salaried individuals, self-employed professionals, and agriculturists with a stable income and a good credit record is eligible for a Union Bank car loan.
What is the interest rate?
Union Bank offers competitive interest rates that generally range between 8% to 10.50% per annum (floating).
The final rate is based on factors such as your credit profile, loan amount, and repayment tenure.
Rates are subject to periodic revision by the bank.
What is the maximum loan amount I can get?
You can get up to 90% of the on-road price of a new car.
For used cars, the maximum loan amount typically ranges from 70% to 75% of the vehicle’s current market value, depending on its condition and age.
Can I apply online?
Yes, Union Bank provides an easy and convenient online application portal.
Visit the official website or use Union Bank’s mobile banking app to apply for a car loan digitally.
Is there any processing fee?
Yes, Union Bank charges a nominal processing fee for car loans.
The fee typically ranges from 0.50% to 1% of the sanctioned loan amount and may be capped at a maximum limit.
It is advisable to confirm the exact charges with the bank at the time of application.

List of Union Bank Car Loans

  • Union Bank New Car Loan
  • Union Bank Used Car Loan (Pre-Owned Car Loan)
  • Union Bank Electric Vehicle (EV) Car Loan
  • Union Bank Car Loan for Agriculturists
  • Union Bank NRI Car Loan
  • Union Bank Top-up Car Loan
  • Union Bank Loan Against Car (Car Refinance Loan)
  • Union Bank Commercial Vehicle Loan
  • Union Bank Luxury Car Loan
  • Union Bank Insta Car Loan (Instant Online Loan)
  • Union Bank Pre-approved Car Loan
  • Union Bank Car Loan Balance Transfer
  • Union Bank Car Loan for Women (Special Scheme)