Can I Mortgage My Car to Get a Loan?

Can I Mortgage My Car to Get a Loan

Do you know your car can come handy when you need instant cash? A lot of customers ask – can they mortgage their car to get a loan? Well, the answer to this question is a resounding YES! An individual can get a loan against his or her car. Several leading banks like HDFC, ICICI and Axis provide the facility of Loan Against Car at attractive interest rates. The best thing about a Loan Against Car is that it can prove to be a cheaper alternative as compared to unsecured loans.

With features like Loan Amount as high as 150% of the present value of the car, minimal documentation and instant loan amount disbursal, this facility is one of the popular choices among customers. Also, a customer can keep using his or her car for personal use despite putting it as an asset to get the loan amount. So, what is this Loan against Car Loan all about? What are those banks that provide this facility? We will talk about this and other factors like Interest Rate, Loan Amount, Eligibility Criteria, Required Documents, etc. So, keep reading!

Lenders Providing a Loan Against Car

As we said earlier, you can put your car as a mortgage to get the required loan amount from different banks. There are mainly three top banks that provide a Loan Against Car. These are HDFC Bank, Axis Bank and ICICI Bank. We will be telling you about the features of loans against cars for each of these banks. This will help you make the right decision. We are starting with HDFC Bank Loan Against Car.

HDFC Bank Loan Against Car

HDFC Bank is the leading Indian private bank that offers a wide range of banking products. Among them, a Loan Against Car is one of the popular products. Existing Car Loan customers of HDFC Bank can get quick funds via an instant top-up on their existing car loan with the loan amount as high as 150% of overall car value. The only thing that a customer needs to fulfill is to have a clear repayment track for 9 months. To check the eligibility for a Loan against Car, customers can log in to their Net Banking and check the ‘Offers’ tab. The loan amount gets credited in a few seconds as soon as you accept the offer.

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We are showing some of the important details related to the HDFC Bank Loan Against Car in the below table. Please have a look.

Loan AspectsDetails
Loan AmountUpto 150% of the Original Value
Rate of Interest13.75% - 16.00% per annum (Depends on the Age and Segment of Vehicle)
Minimum Tenure12 Months
Maximum Tenure84 Months
Processing Fees (Non-refundable)1.50% of the Loan Amount + GST

Minimum - INR 2,500

Maximum - INR 5,000

Foreclosure ChargesNo Foreclosure is allowed within 6 months from the date of loan issuance

Within 1 year from 7th EMI - 6% of the Principal Outstanding

Within 13-24 months from 1st EMI - 5% of the Principal Outstanding

Past 24 months from 1st EMI - 4%  of the Principal Outstanding
Part-prepayment FacilityAllowed only after completion of 12 months (post-payment of 12 EMIs)

Part-payment will be allowed only twice during the overall tenure and once in a year. (The part-payment sum cannot be more than 25% of the principal outstanding balance)

HDFC Bank Loan Against Car Eligibility and Required Documents

Both salaried and self-employed can get a loan against their cars from HDFC Bank. But customers need to fulfill a few conditions to get the required loan amount. We are showing them below. Please check.

For Salaried Individuals

  • Individuals like Doctors, CAs, Employees from Private Limited Companies and Public Sector Undertakings (PSUs) including Central, State & Local Bodies are eligible for this loan
  • The minimum age should be 21 years at the time of loan application while the maximum age cannot be more than 65 years at the completion of the loan tenure
  • The applicant should have worked for a minimum of 2 years in which a minimum of 1 year should be with the current company
  • The annual income of the applicant must be INR 2,50,000, including the income of the spouse
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For Self-employed Individuals

  • Self-employed Sole proprietors in the business of manufacturing, trading or services can apply
  • The age should be between 31 years and 65 years at the completion of the loan tenure
  • The business history of the applicant must be for a minimum of 3 years
  • The annual income should be INR 2,50,000

To apply for HDFC Bank Loan Against Car, you will need a few documents. We are showing them below. Do check.

  • Age-proof documents – Aadhaar Card/ Passport/ PAN Card
  • ID Proof – Driving License/ Aadhaar Card/ Passport Copy
  • Address Proof – Ration Card/ Telephone Bill/ Passport
  • Proof of Income – Latest Salary Slip/ Latest Form 16 or Latest ITR
  • Sign Verification Proof – Passport/ Banker’s Verification/ Credit Card Statement

Axis Bank Loan Against Car

If you are an existing Axis Bank customer and looking to get a loan against your car, Axis Bank Loan Against Car could be the right choice for you. With its special pre-approved offers, customers can get the required loan amount upto 50% of the original loan value of the car at affordable interest rates. Privilege customers can enjoy ultra-fast loan processing with minimal documentation. The best thing about this Axis Bank Loan is that customers can get the cash loan facility with no questions asked about the usage of the loan amount; you can use the money for any of your personal needs.

Some of the important details related to the Loan against Car facility by Axis Bank are shown below. Please check.

Axis Bank Loan Against Car Eligibility Criteria & Required Documents

Only existing Auto Loan (4-wheeler) customers of Axis Bank can get a Loan Against Car with a pre-approved offer. Customers can log in to their Net Banking or Mobile Banking account to see whether they have got pre-approved offers from the bank. On accepting the offer, the loan amount will be instantly disbursed to your account. You can also contact the Axis Bank Customer care to see if you are eligible for this offer or not. While applying for this loan, customers will need a few documents. We are showing them below.

  • Application Form
  • Registration Certificate of Vehicle
  • KYC Documents ( Aadhaar Card/ Passport/ PAN Card/ Driving License)
  • Income Proof ( Salary Slips/ Bank Statements/ Form 16)
  • Employment/Business Continuity Proof

ICICI Bank Loan Against Car

Customers who are looking to fulfill their financial needs with a car can choose ICICI Bank too. The reason: ICICI Bank provides two loan options to customers — Refinance and Top-up on an Existing Car Loan. The customer can choose any of these options at an affordable rate of interest and enjoy minimum documentation.

With the refinance option, customers can opt for a loan on his or her car. The car should not be hypothecated to any bank or financial institution. In the case of Hypothecation, there should be zero outstanding balance.

The loan amount can go upto as much as 140% of overall car valuation. So, the present value of the car will decide the final loan amount. Non-ICICI Customers can also opt for this option.

On the other hand, only existing car loan customers of ICICI Bank can apply for the Top-up option. ICICI Bank will check your repayment history before making the final decision. After the assessment, it will decide the top-up loan amount against your car. Customers can fulfill any of their requirements with this facility. Customers can apply for these loans via Online and Offline methods.

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Personal Loan Interest Rates February 2024
HDFC Bank10.75% - 14.50%
ICICI Bank10.75% - 19.00%
IndusInd Bank10.25% - 26.00%
Kotak Bank10.99%
RBL14.00% - 23.00%
SMFG India Credit12.00% - 24.00%
Standard Chartered Bank11.49%
Tata Capital10.50% - 24.00%
Home Loan Interest Rates February 2024
Axis Bank8.75% - 9.15%
Bank of Baroda8.50% - 10.60%
Citibank8.75% - 9.15%
HDFC8.50% - 9.40%
ICICI Bank9.00% - 9.85%
Indiabulls Housing Finance Limited8.65%
Kotak Bank8.70%
LIC Housing8.50% - 10.50%
Piramal Capital & Housing Finance10.50%
PNB Housing Finance8.50% - 10.95%
Reliance Home Finance8.75% - 14.00%
State Bank of India/SBI9.10% - 9.65%
Tata Capital8.95% - 12.00%