Car Loan in UAE from Dealership or Bank - Know which car loan option is better for you from dealership and Bank. And also know the financing process of both with advantages and disadvantages.
Get Used Car Loan at attractive interest rates
Get Car loan at Lowest Interest Rate
The United Arab Emirates has an extensive car market. Not to mention, the residents of the UAE are fond of cars and luxury vehicles and, this increases the demand for automobiles in almost every part of the country. Along with new vehicle sales, the country has a flourishing used car market, making it easier for individuals from all financial segments to own a car.
Several banks and financial institutions offer used car loans in UAE, further easing the financial crunch that a buyer may face for getting a car. Evidently, car loans are among the cheapest loans offered by the banks with minimal documentation.
However, the process of loan approval for a used car is different from that of a new car and, it varies depending on the bank. The article below lists details of getting used car loan in the UAE along with the features and benefits of getting one.
Although car prices are affordable in the UAE, purchasing a car is a big investment. Accumulating funds at such a scale is not easy for most individuals. To resolve the issue, several banks and financial institutions offer car loans in UAE for convenient car purchases. By taking a car loan, you can easily purchase a vehicle and pay the amount back in flexible instalments with a nominal interest rate.
Similarly, individuals willing to buy a used car can approach the bank and apply for a used car loan from any bank or private financing institution. The interest rate for a used car loan can depend on various factors and, it is slightly higher than loans taken against purchasing a car from the showroom.
Additionally, used car loan interest rates also depend on the bank you are applying with and, you also need to inform the seller about car finance before purchase. Most banks in the UAE offer used car loans for vehicles not older than 5 years and the documentation for the same can take up to a week.
Financing a car in the UAE removes the burden of paying a lump sum amount. You can pay your loan amount in flexible instalments at low-interest rates of around 4-5%. Not only this, there are several other features and benefits of acquiring a used car loan in the UAE as mentioned below.
|Read: Minimum Credit Score required to get a car loan in UAE|
You need to pay interest depending on your loan amount and tenure. The interest rate depends on several factors and the loan offering bank. Most banks offer two types of used car loans interest rates as mentioned below.
Numerous banks offer used car loans in the UAE, however, to find the best deals you need extensive research and the process becomes hectic. To ease your research, we have compiled the list of the used car loan offers in the UAE.
|Lending Bank Name||Flat Interest Rate||Minimum Financing Amount||Maximum Financing Amount|
|Dubai Islamic Bank||3.70%||AED 20,000||AED 1.5 million|
|Abu Dhabi Commercial Bank||3.50%||AED 20,000||AED 1.5 million|
|Abu Dhabi Islamic Bank||3.25%||AED 20,000||AED 1 million|
|Emirates NBD Bank||3.49%||AED 30,000||AED 500,000|
|Emirates Islamic Bank||3.99%||AED 20,000||AED 1.5 million|
|HSBC Bank||2.85%||AED 30,000||AED 918,000|
Car loans are easily available to most individuals in the UAE. However, the various banks offer different interest rates, including other charges and fee that considerably increases the cost of your used car loans. To avoid paying unwanted fees and charges, you need to compare used car loans in the UAE. Following are the most preferred UAE banks, offering used car loans.
ADCB Bank is one of the most popular banks in the UAE offering several banking services and products such as individual bank accounts, corporate accounts and loans. Among various loans, ADCB offers some of the most affordable used car loans with interest rates of as low as 3.50%. Following are the details of ADCB used car loans in the UAE.
One of the largest banks in the UAE in terms of paid-up capital, Emirates NBD offer used car loans at competitive interest for flexible loan tenures. The bank offer hassle-free and quick one-day loan approval. Meaning, you receive the loan amount within the same day. Following are the details of Emirates NBD car loans in the UAE.
Dubai Islamic Bank is one of the largest Islamic banks in the world. Along with various sharia-compliant products, the bank offers an extensive loan and credit service. The bank offers used car loans at low-profit rates and low finance charges. Following are the features of Dubai Islamic Bank.
Abu Dhabi Islamic Bank is another well-known bank offering world-class banking products in the Sharia-compliant method. Among its various services and products, used car loans are amongst the most preferred. You can easily apply for a car loan online and get it quickly approved. Depending on your credit score, you get preferential profit rates and flexible loan tenure. Following are the features of Abu Dhabi Islamic Bank used car loans in the UAE.
First Abu Dhabi Bank is one of the largest and safest banks in the world. The bank offers a range of financial services and products. Among various loan products, FAB car loans are popular among vehicle buyers. Offering used car loans at competitive rates, you get low financial charges to pay and flexible loan tenures. Following are the features of FAB used car loans in the UAE.
RAKBANK is one of the oldest native banks in the UAE. Used car loans from RAKBANK are among the most affordable in the UAE with interest rates starting from 1.99% for salaried individuals. Along with numerous other benefits, you also get flexible tenure for loan repayments at your convenience. Following are the features of RAKBANK used car loans.
Before applying for a car loan, you need to satisfy the requirements laid down by the banks. Similarly, for the used car loans, you need to fulfil the following eligibility criteria.
After you have satisfied the eligibility criteria, you need to produce a few documents during the loan application. Following are the required documents, you need to submit while applying for used car loans.
Documents required for salaried individuals
If you hold a salary account in the same bank where you are applying for a used car loan, you don’t need to submit a salary certificate.
Note:- The bank may ask for additional documents depending on your employment and financial status. Before applying for a used car loan, you should verify the same with your bank.
With digital advancement in the banking industry, you can conveniently apply for car loans within minutes and get them approved within hours. Following are the various ways of applying for a used car loan in the UAE.
Online Application - You can conveniently apply for a used car loan by visiting the official website of a bank. You need to have your documents ready and upload them along with the online application form. Once your details are verified, your bank approves your loan amount and deposit in the required account.
Offline Application - You can visit the nearest bank branch in person and apply for a used car loan in the UAE. You need to carry the documents mentioned above in addition to your personal identity and contact details. Later, you need to fill out an offline loan application form and submit your documents.
The easiest way to calculate your car loan instalments is through Loan EMI calculators. You simply need to enter the loan amount and interest rate offered along with the car loan tenure in months. After entering the details, you need to press the calculate button. Later, you will get the estimated monthly instalment amount for your used car loan.
The amount may not be precise since the bank includes several other charges like processing fees and loan insurance cost etc in the final cost of your loan. However, with a loan EMI calculator, you can get an approximate monthly instalment.
Following are the factors that influence the cost of your used car loan in the UAE.
Ans: Yes, several banks in the UAE offer foreclosure options where you can close your loan account before the loan tenure expires. You need to pay the outstanding amount in lump sum, including an early settlement charge.
Ans: The interest rates for used car loans in the UAE is slightly higher than new car loans. In general, you may need to pay an interest rate of 4-5% of the principal loan amount.
Ans: Yes, various banks offer a fully online loan application process. You simply need to enter your details and upload the required documents. After verification, the bank approves your loan within hours.
Ans: No, the minimum age requirement for a used car loan in the UAE is 21 years. Additionally, the bank accepts loan applications until the age of 65 to 70 years.