ABN AMRO Bank NV Car Loan Review

ABN AMRO Bank has a wide range of car finance options, each of which professes to be “fast, cost-efficient and user-friendly” - in other words much like the car it is supposed to help purchase. Car loans from ABN AMRO bank can be availed to buy new as well as used cars.

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Quantum of loan

The minimum amount of car loan that can be availed from ABN AMRO Bank is Rs 50,000. The maximum loan amount varies according to the percentage of ex-showroom price of the car as specified below:

1     Up to 90% of the car value in models like Maruti 800, Maruti Esteem 1300 cc,   Maruti Zen, Maruti Omni Van, Maruti Baleno, Maruti WagonR, Maruti Alto, Fiat Siena, Toyota Qualis, Daewoo Matiz, Mercedes Benz E Class, Opel Astra, Opel Corsa, Ford Ikon, Hyundai Santro, Hyundai Accent, Mitsubishi Lancer, Tata Indica and Honda City.

2     Up to 85% of the car value in models like Maruti Baleno Altura, Fiat Uno and     Fiat Siena Weekend.

3    Up to 80% of the car value in models like Tata Safari, Daewoo Cielo, Daewoo Nexia and Mahindra Bolero.

4     up to 75% of the car value in models like Maruti Gypsy, Ambassador Nova Isuzu, Tata Siera, Tata Sumo and Mahindra Armada

5    Up to 70% of the car value in case of Mercedes Benz S Class.

For Mercedes cars, the loan amount will be calculated only on the base price and not on ex-showroom price.

Eligibility conditions

To qualify for a standard car loan from ABN AMRO Bank, an individual or sole proprietor (ship) needs to have a minimum gross household income of Rs 60000 per annum and for a premium car loan, one needs to have an income of Rs 100000 per annum.

Partnerships and limited companies are also eligible for car loans from ABN AMRO Bank provided they have Rs 60000 per annum Profit (after tax plus depreciation, partner's salaries and interest on partner's capital) for a standard car and Rs 100000 per annum likewise Profit for a premium car. Additionally, business concerns have to show minimum gross sales of Rs 4,50,000 per annum as well as minimum net worth of Rs 2,00,000 per annum.

Documents required for ABN AMRO Bank car loan application by individuals are:

1    Proof of income. Salaried employees may produce their income tax assessment order, computerized  salary slip or appointment letter. For government, public sector employees or employees of large public limited companies, the salary certificate will suffice. Self-employed individuals and professionals need to produce a copy of their latest income Tax return or TDS Form 16.

2    Proof of identity which should include One photograph along with a copy of the passport/ driving licence/front & back of your credit card/ Income Tax PAN Card/ signature verification by applicant’s bank (as per ABN AMRO bank format).

3    Proof of address which may include a copy of the ration card/telephone bill/electricity bill/water bill/LIC receipt / policy/electoral identity card/latest card billing statement or – bank passbook statement.

There are separate documents required for loan application by business concerns like partnership firms and limited companies.

Loan Tenure

The number of years for which car loans are available from ABN AMRO Bank can range from one to five years. Borrowers can choose from a number of repayment plans like Arrears and Advance installment to suit their individual requirements and resources. Salaried employees and self-employed professionals have the convenience of opting for alternate payment plans in which the monthly installments either grow each year like in the Step-up payment plan or decline each year as in the Step-down installment plan.

Rate of Interest

New car loans from ABN AMRO Bank carry a 15% rate of interest for all segments – standard, premium, super premium and luxury. This effectively means that no matter what the new car value or what the new car loan amount, the rate ofinterest is the same.

Pre-payment charges

ABN AMRO Bank offers a borrower the flexibility of pre-paying up to 25% of the principal amount of the car loan once every 12 months, at no cost. The borrower may also pre-pay more than this amount but with a pre-payment charge of 4% of the amount exceeding the initial 25%. However after completion of 3 years of the loan tenure, a borrower can foreclose the rest of the loan without any prepayment charge.

Loans for used cars

Besides offering finance options for new cars, ABN AMRO Bank has loans for a wide range of pre-owned car models as well. The maximum loan amount can be up to 80% of assessed value of the car. The bank has specified the models on which it approves loans for used cars.

In the standard segment the models include Maruti 800, Maruti Zen, Maruti Omni Van, Maruti Wagon R, Maruti Alto, Maruti Gypsy, Hyundai Santro, Daewoo Matiz, Tata Indica, Fiat Uno and Ambassador.

Among the premium models for which the bank approves loans are Maruti Esteem, Maruti Baleno / Altura, Hyundai Accent, Ford Ikon, Opel Corsa, Opel Astra, Daewoo Cielo, Daewoo Nexia, Fiat Siena / Weekend, Honda City, and Mitsubishi Lancer, Toyota Qualis, Tata Safari, Tata Sumo, Tata Siera, Mahindra Armada and Mahindra Balero.

In the luxury car segment, ABN AMRO Bank has used car loans for Mercedes Benz.

The rate of interest on ABN AMRO Bank used car loans range from 17.50% to 18.50%. This rate is applicable for used cars in all segments. However there is an additional processing fee varying from Rs 500 to Rs 1000.

The ABN AMRO Bank car finance webpage does not mention the requirement of a guarantor for approval of loans. Also it does not specify the processing fees that is usually charged by a financer while processing a loan.

In certain cases, ABN AMRO Bank may consider car loan applications even without adequate proof of income. In such cases, an individual will have to present one of the following:

1    A photocopy of front and back of the credit / charge card approved under the Credit Card Program above along with billing statement for last 2 months, provided the card relationship has been for at least 1 year.

2    Evidence of established repayment track record for the last 12 months with any of the specified financers.

3     Members of select premium clubs can attach just a copy of their club identity card and a copy of the latest billing statement.

Ultimately ABN AMRO Bank reserves the right to impose any terms and conditions it deems fit and in the concluding disclaimer specifies that all loans will be approved at the sole discretion of the bank.