The 2 most prominent steps before finalizing on an auto loan are –

1) Scouting for the Best Rate

Before one starts to hunt for the best interest rate available on cars, one needs to focus on 2 things. One - finalize the model of the car one wants and two - the amount of money required to finance it. These steps are important as different cars have different interest rates, depending upon type and size. The person will then have to calculate the EMIs offered by different companies online. Various banks, like – Bank of India, SBI, HDFC Bank, etc. provide EMI calculators online. One will have to check for EMI rates for about 4 to 5 dealers. This provides a better search for our car loan need.

Also, asking for cash discounts is sometimes better than getting a lower rate of interest. Harsh Roongta, Chief Executive Officer at Apnapaisa.com, says, "Customers should ask only for cash discount. Most dealers confuse customers by saying they will offer a lower interest rate instead of a cash discount. But car buyers hardly know how to calculate the actual IRR. Hence, if a borrower is paying 1 lakh as down-payment for a 5-lakh car loan, he/she should ask for a cash discount on that 1 lakh. Then he should compare this discount offers by various lenders to identify the best deal."