Financing a car with a bit of help from the banks and Non-Banking Financial Companies(NBFCs) helps you in numerous ways. A car loan is one such loan specifically designed to meet the finances and expenses of purchasing a car. These authorised lenders sanction car loans to infinite people worldwide every day. The loan is secured, and the principal amount sanctioned is based on the pledged asset’s value(car) for a certain period known as tenure. By the end of the tenure, the borrower should have paid the principal amount in full with interest to retain the car’s full ownership. However, certain circumstances make paying off the loan harder than anticipated. 


Credit Information Bureau (India) Limited (CIBIL) is a credit company that maintains records of personal information, banking information, employment information in addition to the past credit list(debts and loans acquired previously from banks and NBFCs) of individuals, corporations, societies and other banking customers. Every bank and financial company verifies the report before sanctioning a loan and before granting a moratorium facility. The report is summarised by a three-digit score known as credit or CIBIL score that varies from 300 to 900 usually and is required to be high to avail low Car Loan Rates. It depicts the borrower’s loan repayment capacity, and maintaining a good score is a necessity. 



Covid-19 hit pretty hard in the faces of the common folks. The finance of billions of people in India has dwindled substantially during the pandemic and is still unstable in numerous households. And paying the Equated Monthly Instalment (EMIs) every month in addition to covering the day to day expenses of a household is a huge financial expense that is virtually impossible to many. The Reserve Bank of India, considering and realising this, introduced a loan moratorium period in early 2020. By opting for this facility, a borrower needn’t pay interest amounts for a certain period which is usually for three months. The instalment is, however, not deducted from the loan payment. Instead of paying those 3 months instalments, the borrower can add that EMI amount to the principal amount or divide evenly to the rest of the EMIs or add it to a particular number of months(adding the 3-month instalment to the last four months of the tenure). Although, not all car loan borrowers can avail of this facility. The banks and financial companies grant this only to those who have paid the previous instalments on time and have a good credit score(above 700). These were the initial terms of the facility, but after the second wave of the coronavirus, the Reserve Bank Of India restructured it in May 2021. According to this, the borrowers who have or have not availed of the loan moratorium period can restructure their loan if they have a good credit score and have paid all the previous monthly instruments on time for a maximum period of two years. During these two years moratorium, a borrower is completely free of paying principal amount and interest. After the two years, they can follow the loan terms by increasing the EMI and shortening the tenure or extending the tenure and paying a low-interest amount. It is the choice of the borrower’s, although increasing the EMI and decreasing the tenure period will save much money over the latter option. But, either way, after the end of the moratorium period paying off the loan amount with the owed interest is necessary. A borrower of a car loan should approach the bank or financial company they have availed the loan form and submit a separate application form to avail this facility. The banks and NBFCs, regarding your credit report and credit score, will grant an extension if you meet all their expectations and requirements. 



Numerous banks and financial companies provide car loans to millions of people using the internet, and you can apply for a car loan online conveniently. For instance, by searching for a Car Loan SBI on google, the SBI car loan application form is pulled up.