Prepayment of Auto Loans

Hi,

I have a query. I have taken loan from citibank for 3 years for the car. Its been 1 year we have been giving emi. We however want to pre pay the left outstanding amount. Just wanted to know if prepayment option is available or do we need pay back teh amount along with interest for next 2 years too? Is there any penality and how much?

Thanks

Ruchica

You can pre-pay.  It will attact pre-payment penality on the amount pre-paid (no interest). Check for the penalty - it may be in the range of 3 to 5% (pvt. banks).

hi

please help in clearing my doubts in prepayment

if take loan of 5lakhs from bank with intrest rate of say 10% for period of three yrs

and if i want to pre pay whole amount in 8months, should i pay 5lakhs+36months interest or 5lakhs+8months interest only?

does this rule vary from bank to bank ,private and govt bank?

You would pay interest only for the duration of loan amount use. The balance counts as pre-payment, and there is usually a pre-payment penalty which varies (check your golden document for your prepayment penalty - could be 2 or 3% of the outstanding or more depending on how ignorant you were and how greedy the bank was)

So what you pay is outstanding balance + prepayment penalty on the outstanding. The principle is the same for any bank loan, smaller details will vary as per exact contract terms (refer golden document again)

Just to add / put it statistically...

The Rs.5 lac loan @ 10% interest p.a. with a repayment tenure of 3 years would carry an EMI of Rs.16135/-.  The total repayment (with interest) will amount to Rs.5,80,860/-.

In 8 months you would have paid Rs.1,29,080/-.  Thereafter, the balance outstanding would be Rs.4,01,414/-, which will be pre-payable with pre-payment penalty (whatever).

The Rs.5 lac loan @ 10% interest p.a. with a repayment tenure of 3 years would carry an EMI of Rs.16135/-.  The total repayment (with interest) will amount to Rs.5,80,860/-

@pankaj... can u explain it bit in details with all calulations.,how to estimate an EMI

is there excel sheet designed to tackle this,please give me that

Please go through this link/discussions - it contains how to calculate in Excel.

please let me know the account status of my accent car no.PB65C 9000 IN THE NAME OF PARMINDER SIDANA

Harjit - contact the bank directly. CW does not have any means of getting this info from your lender bank.