When you're considering transferring Car Loan to another person, the situation often arises from a need to adjust to life's changing circumstances. Perhaps you're moving abroad, upgrading your vehicle, or simply looking to offload your current financial commitments. Whatever the reason, understanding how to transfer a Car Loan to another person can provide a practical solution, offering peace of mind to both the current holder and the prospective new owner.
Navigating the path of a Car Loan transfer isn't just about signing over some papers; it's about ensuring both parties involved are on solid ground financially and legally. This guide aims to demystify the process, providing clear steps and essential considerations for those pondering how I can transfer a Car Loan to another person.
Transfer Car Loan to another person: Step-by-step guide
- Check your loan agreement: Start by looking closely at your current Car Loan contract to see if you can move your loan to someone else. Not every lender lets you do this, making this first step very important.
- Find a suitable transferee: Now, you need to find someone who's willing and financially able to take on your loan. Your lender must approve this person based on their ability to pay back the loan.
- Seek lender approval: The next move is to get in touch with your lender and talk about how to transfer your Car Loan. They'll want to know who you're planning to transfer the loan to and will likely check this person's credit history to make sure they're good for it.
- Agree on transfer terms: Once your lender gives the green light, you and the person taking over the loan need to talk about any fees for the transfer and understand each other's duties. Both of you must know what you're agreeing to.
- Complete the paperwork: To make the transfer official, some forms must be filled out. This might include a new loan contract for the person taking over the loan.
- Notify relevant parties: After everything is signed and sorted, you need to let your insurance company know about the change. Also, update the car's registration details to show the new owner and who's responsible for the loan now.
Charges for transferring Car Loan to another person
1. Loan transfer fees: Lenders generally impose a fee for processing a Car Loan transfer request, which can range from ₹500 to ₹1,000. This fee usually isn't refundable, even if the transfer doesn't go through.
2. Stamp duty: This is a government tax on the transfer of property, including vehicles. The rate of stamp duty varies by state but is normally between 3% and 5% of the loan amount.
3. RTO charges: The Regional Transport Office (RTO) levies charges for officially transferring the ownership of the car. These fees also differ by state and can be anywhere from ₹300 to ₹500.
4. Legal fees: If a lawyer is engaged to help draft and process the necessary paperwork, their charges will apply, and these can vary.
5. Insurance premium: Transferring a Car Loan may also affect the insurance policy, potentially leading to a new premium payment that would vary depending on the policy terms.
Also Read: How to avail 24x7 Top-Up Car Loan?
For those pondering "can a Car Loan be transferred to another person?" or "can I transfer Car Loan to another person?", the answer is yes, with the right preparation and understanding of the associated costs.
For those in the market for a new vehicle, the Axis Bank New Car Loan offers loans starting from ₹1 Lakh with the possibility to cover up to 100% of on-road funding. This allows for greater flexibility and ease when purchasing a new vehicle. Additionally, borrowers benefit from attractive interest rates and Axis eDGE Reward points, enhancing the value of the loan. With a minimum loan amount set at ₹1,00,000 and special benefits for priority banking customers, Axis Bank ensures a comprehensive and rewarding car financing solution.
Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.
