HSBC Car Loan in UAE

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HSBC Car Loan in UAE

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  • EMI Tenure up to 48 Months
  • Lowest Interest Rates

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Serving over a whopping 40 million customer base across the globe, HSBC Bank is one of the largest financial organisations in the world, with its operations in more than 64 countries. In the UAE, the bank's history dates back to 1946, when the Imperial Bank of Iran began operating as the forerunner of HSBC. Having said that, HSBC bank offers a comprehensive range of products and services suiting the customers' financial needs, including personal and business accounts, investment banking, savings and deposit schemes, as well as credit & loan services. 

Furthermore, we all know that purchasing a car requires hefty funds and can be taxing for most individuals. However, with an HSBC car loan, you can easily finance your dream car without worrying about your financial burdens. Additionally, you can acquire a car loan at low-interest rates with a convenient application process and incredibly lenient criteria. Now, let's delve deeper into the features, benefits and various ways to apply for an HSBC car loan:

Features and Benefits of HSBC Car Loans

With over 70 years of professional experience, HSBC innovates its banking products aligning with the individual's requirements. In addition, along with competitive interest rates, you get numerous benefits for easy financial management while financing your new or used car. Given below is a rundown of a few features and benefits of the HSBC car loan in the UAE: 

  • Low-Interest Rates - HSBC car loans are amongst the cheapest loan options available in the UAE. Moreover, depending on your relationship with the bank, you may get an additional rebate on your car loan interest rates. For example, a Premier account holder can enjoy a 2.29% annual percentage interest rate. 
  • Flexible Loan Tenure - HSBC provides a flexible loan tenure ranging from 12 months to 60 months. Along with that, you can opt for tenures suiting your financial requirements and plans. Talking about the flexibility in loan repayment tenure, you may note that a shorter tenure ensures a lower interest cost but higher monthly repayments. 
  • No Salary Account Needed - For acquiring a car loan in UAE, you may need a salary account in the lending bank. To make car financing easily accessible, the bank doesn't require a salary transfer account. However, transferring salary to an HSBC bank account can offer you additional discounts on loan interest rates since you already have an existing relationship with the bank.
  • Balloon Repayment Option - If you like changing your car every 2-3 years, the bank also gives you the option of balloon repayment. In such a repayment option, you need to pay a portion of your car financing in a lump sum at the end of the loan tenure, thereby reducing your monthly EMIs.
  • Attractive Interest Rates on EVs - HSBC Bank is one of those banks offering green car loans in the UAE. This benefit further points that if you are planning to purchase a fully electric car, you can get a 0.25% discount on your car loan flat interest rate. Additionally, individuals purchasing a Tesla car get a special flat annual percentage rate of 1.79%.
  • High Car Loan Amount - Depending on your eligibility, you can finance as high as AED 600,000 for purchasing your dream car in the UAE.
  • Loans for Pre-owned Cars - Purchasing a pre-owned car is a lot easier with HSBC used car loans. This is because you enjoy lower downpayment and EMIs while buying a second-hand vehicle. Additionally, the bank offers concierge services that provide over 240 points electrical and mechanical inspections, vehicle testing and registration, including accident and service history verification.

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HSBC Bank Car Loan Interest Rates In the UAE

As mentioned before, HSBC offers low-interest rates on car loans. Additionally, you may also get preferential rates as low as 1.99% APR based on a few factors. Most significantly, your overall loan cost reduces with a low-interest rate, including your monthly EMIs. Here are the details of HSBC car loan interest rates in the UAE:

Car Loan Type Flat Rate Reducing Rate
New Car Loan 2.49% per annum 4.60% per annum
Used Car Loan 3.49% per annum 7.29% per annum

Eligibility Criteria to Apply for HSBC Car Loans in the UAE

While applying for an HSBC car loan, you need to satisfy a few eligibility criteria pertaining to your age, nationality, monthly income and more. Additionally, the bank may alter a few criteria on a person-to-person basis. However, here are a few common eligibility criteria that one needs to fulfil to apply for an HSBC car loan:

  • Applicant's Age - An applicant must be a minimum of 21 years of age to apply for an HSBC car loan. Additionally, the upper age limit to apply for HSBC car loan applications is 65 years.  
  • Minimum Salary Criteria - You need to have a minimum salary of AED 10,000 per month to acquire a car loan from HSBC bank.
  • Residency - HSBC bank offers car loans to UAE nationals and residents as well as ex-pats. However, ex-pats must ensure that they have all the documents (as asked by the bank) handy while applying for a car loan in the UAE. 
  • Credit Score - For any kind of loan you take, the bank verifies your creditworthiness through an AECB score. Thus, based on your credit score, the bank may approve or reject your loan application. With an AECB credit score of 700 or above, you can easily avail yourself of an HSBC car loan without any hassle. 
  • Down Payment Criteria - As per the Central Bank's guidelines, the maximum financing a bank can offer is 80% of the car's invoice value. Meaning you need to pay 20% of the car cost from your pocket. This amount is widely known as the down payment.

Documents Required For HSBC Car Loans Dubai

Once you satisfy all the eligibility requirements, you need to collect and submit various documents supporting your proof of identity, residence, salary and address. Here's a quick rundown of some general documents required during an HSBC car loan application:

Documents Required for Employed Individuals

  • A valid driving licence issued by the competent authority in the UAE,
  • Identity proof such as Emirates ID card in original and a copy for UAE nationals, 
  • An original passport ID with valid visa details for ex-pats and residents,
  • Proof of address such as utility bill, rent or lease agreement,
  • Last 3 to 6 months bank account statement, 
  • A salary certificate addressing HSBC from your employer (Not applicable if you hold a salary account with the bank),
  • A dealer's quotation or proforma invoice of the car or mentioning the ex-showroom and on-road price of the vehicle,

Documents Required for Self-employed Individuals

  • A valid driving license issued by the competent authority in the UAE,
  • An original Emirates ID and a copy for UAE nationals, 
  • An original passport ID with valid visa details for the residents and ex-pats, 
  • A valid trade licence issued by the Department of Economic Development (DED),
  • The latest Bank account statement for both individual and company accounts for the last 3-6 months,
  • A copy of a power of attorney (If asked by the bank),
  • Details of expenses, existing loans and liabilities,
  • A dealer's quotation or the proforma invoice mentioning the ex-showroom and on-road price of the vehicle.

How to Apply for HSBC Car Loan in the UAE?

HSBC offers convenient car loan applications through various online and offline modes. While you can visit the bank branch in person, online applications are relatively easy with simple steps. However, you can apply for an HSBC car loan in the UAE either through an online or offline mode of application. Here are the ways to apply for an HSBC car loan in the UAE:

Online Car Loan Application - You can visit the official website of HSBC Bank UAE to apply for online car loans. After logging on to the portal, you need to navigate to the car loan section and fill out an online application form after going through all the details and offers. Post submission, the bank representative will contact you for the further loan application process.

Offline Car Loan Application - You need to visit the nearest HSBC branch with all the required documents for offline application. Subsequently, you need to contact the loan officer providing your details and contacts. Next, the bank representative will ask you to fill out an offline loan application form. Here, please enter your details as asked in the form and submit the form after attaching your documents. After verification and approval, the bank will credit the loan amount to your car dealer.  

Application via Phone Call - Alternatively, you can reach out to the customer support team and request a car loan by providing your personal and contact details. Then, the support representative will guide you through the loan application process. Following are the contact numbers for HSBC car loan support:

HSBC Car Loan Contact No Within UAE 04 294 8000
HSBC Car Loan Contact No Outside UAE +971 4 294 8000

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RAKBANK Car Loan Calculator

With an HSBC car loan calculator, you can conveniently forecast your monthly EMIs, the total interest you need to pay during the loan tenure, and the total loan cost you incur. Moreover, a loan calculator is the most viable option since car loans and EMI calculations follow convoluted methods. 

Furthermore, you can visit any car loan aggregator website to find an HSBC car loan calculator. To compute your car loan EMIs, you need to enter details like car cost, down payment amount, the interest rate offered, and your loan tenure. Since there are several charges and fees you need to pay during the application, a car loan calculator can only provide you with an approximate EMI. However, it can help you manage your finances according to your budget beforehand.

HSBC Car Loan Offers

Along with affordability, HSBC car loans also come with various offers from time to time. Let's check out the list of a few offers available on HSBC car loans in the UAE:

  • HSBC car loans in the UAE offers a 100% processing fee waiver for existing and new customers who apply for car loans before April 2, 2022.
  • All Premier and Advanced customers applying for Balloon Finance on HSBC car loan receive a 100% waiver on processing fee and preferential flat annual percentage rate of 1.99%. 
  • All existing and new customers applying for HSBC Green Car Loan receive a 100% loan processing fee waiver.

To avail of the offers, you need to ensure that you fulfil the eligibility criteria laid down by the bank. For further details, you can visit the official website of HSBC bank.

HSBC Car Loan Fees and Charges

When applying for an HSBC car loan, you need to pay a few charges such as loan arrangement fees, finance charges etc. Here is the list of fees and charges you need to pay during the HSBC car loan application:

Type of Fees and Charges Amount in AED
Car Loan Processing Fee 1% of the principal loan amount with a minimum charge of AED 500 and a maximum charge of AED 2,500
Late Payment Charges 2% of the delayed loan amount with a minimum charge of AED 50 and a maximum of AED 145
Early Settlement Charges 1% of the outstanding loan amount
Advance Payment of Instalment 1% of the advance payment amount
Change of due date on standing instruction AED 25
Liability Letter AED 50
Value Added Tax 5% of the bank's fees and charges

Important Terms and Conditions for HSBC Car Loans

Following are the important terms and conditions for HSBC car loans in the UAE:

  • An applicant can cancel the loan application only within the drawdown period. Note that the drawdown period is a time between the document submission and loan approval.
  • While applying for a car loan, the applicant needs to give an undated security cheque to the HSBC bank with an amount not exceeding 120% of the loan amount. 
  • If the customer makes an advance or overpayment, the bank will adjust the final payment due accordingly. 
  • The bank calculates the interest rates on a daily outstanding balance following the gregorian calendar, and the customer needs to pay the interest rates on a monthly basis. 
  • Since your vehicle acts as collateral, the bank may repossess it in case of non-payment of EMIs. 
  • The car loan agreement binds the bank and the customers, including their respective successors and heirs. 

Frequently Asked Questions

Q1. I don't have an account with HSBC bank, will I be able to get a car loan?

Ans: Yes, you don't need to have a bank account with HSBC to apply for a car loan. However, existing customers get attractive discounts on HSBC car loan interest rates. 

 

Q2. What kind of interest rates are applicable on HSBC car loans?

Ans: HSBC Bank provides two types of interest rates on car loans, namely flat rate and reducing rate. In the case of flat rates, the interest is calculated on the total loan amount for a pre-specified tenure. For reducing rates, the interest is calculated every month on the outstanding loan amount. However, mind that the EMI reduces after each repayment if you opt for a reducing interest rate car loan.

Q3. What is the minimum salary required to apply for an HSBC car loan in the UAE?

Ans: To apply for a car loan in the UAE, you need to have a minimum monthly income of AED 10,000 or above.

Q4. What is the maximum car loan amount I can acquire from HSBC bank?

Ans: Based on your eligibility, you can opt for a maximum car loan of AED 600,000.

Q5. Can I cancel my HSBC car loan?

Ans: Yes, you can cancel your car loan within the drawdown period. It is a time slab between your document submission and loan approval. However, once your loan is credited into your account, you cannot cancel the agreement. 

Q6. Do I get the option of an early settlement of my car loan?

Ans: HSBC Bank provides the option of early settlement, and you can foreclose your loan account by paying the outstanding amount in a lump sum. However, you need to pay an early settlement fee of 1% of the remaining loan amount.

Q7. What is balloon financing?

Ans: In balloon financing, you need to pay a portion of your car financing in a lump sum at the end of the loan tenure. In addition, the interest rates are not applicable on this amount, and you can reduce your EMIs. Therefore, it is a viable option for individuals who prefer changing their cars every 2-3 years. 

Q8. What is an HSBC Green Car Loan?

Ans: Promoting emission-free vehicles, HSBC offers Green Car Loans if you are financing an electric vehicle (EV) or a hybrid vehicle. Moreover, the bank offers attractive interest rates and a 100% waiver of processing fee on Green Car Loans.