SBI CAR/AUTO LOAN
|1.||Target Group||:||Permanent employees of State/Central Govt., Public Sector Undertakings, corporations, private sector companies, and reputed establishments are eligible under the scheme.|
|2.||Eligibility||:||Permanent employees of State/Central Govt., Public Sector Undertakings, corporations, private sector companies, and reputed establishments are eligible under the scheme. Professionals, self-employed and others who are income tax assesses and persons engaged in agriculture and allied activities can also avail of the loan facility. Loan can also be granted to proprietary firms private/public limited companies not having any other borrowing arrangements, upon meeting specific criteria.|
|3.||Purpose||:||Term Loans are sanctioned by the Bank for purchase of new passenger cars, Multi Utility Vehicles (MUV), Micro Bus or jeeps. Reconditioned Vehicles not more than 5 years old can also be financed.|
|4.||Type of facilities||:||Term Loan|
|5.||Quantum of Finance||:||i.The maximum loan amount that can be granted would be restricted to 36 times the net monthly income of salaried persons (i.e., net of all deductions including actual monthly tax deductions at source). In case of others, maximum loan amount would be 5 times the net annual income (i.e., income as per latest income tax return filed less taxes payable or other suitable documents which prove their income) subject to a maximum of TK. 20 lacs.|
|ii. Regular income from all sources can be considered provided the sanctioning authority is satisfied with the proof of income. The income of spouse can be included provided the spouse guarantees the loan.|
|6.||Margin||:||Minimum margin should be 70%. Valuation of vehicle would be as on road i.e., inclusive of one time road tax, registration, insurance, etc|
|7.||Take Over Of Loans||:||i) Takeover of car loans may be considered selectively where the cars are not more than 5 years old which should however be repaid within 5 years from the date of its purchase or within 4 years of loan sanctioned by 2nd financier whichever is less. It should be a single ownership vehicle, where no insurance claim should have been availed and its account should be a standard asset i.e. all repayments have been made as per terms of sanction of the original financier.|
|ii) Reimbursement of costs of unencumbered vehicles can also be given under the above takeover norms and other terms of financing reconditioned vehicles up to 5 years of age.|
|8.||Rate of Interest||:||Loans may be given both on a fixed or a floating rate basis, as per interest rate prevailing from time to time. Branch Manager may have discretion to reduce the interest rate by up to 1% p.a.|
|:||a.Hypothecation of vehicle and noting of hypothecation charge in the books of BRTA.
b.Guarantee of spouse , if her income has been taken into account for computing eligibility of loan amount.
c.check-off facility, OR Third party guarantee for the loan amount.
Post dated cheques to be obtained for the entire amount of the EMIs.
|10.||Processing fees||:||1% of loan amount. The Branch In-Charge will have discretion to reduce the processing fees by up to 50% :
i) where bulk business is involved and a check off facility from a reputable employer is available.
ii) during short period promotional drives.
iii) considering the value of the customer.
|11.||Repayment||:||a. The loan should be repaid in suitable monthly instalments in such a manner that the loan is liquidated within a period of 5 years. The customer will have option for payment in shorter duration.
b. The repayment should be fixed on the basis of equated instalments, preferably with a check off facility in the case of salaried persons.
c.The Equated Installment will be determined on the basis of the current rate of interest.
d. Where check off facility is not available post dated cheques should be obtained.
|12.||Documentation||:||Standard documents for car loans.|
|13.||Mode Of Disbursement||:||Amount should be remitted direct to the supplier/dealer by means of a `Crossed account payee’ demand draft / banker’s cheque which should be forwarded under cover of a letter.
No charges should be levied for issuance of Banker’s cheque/demand draft.
|14.||Discretionary Powers||:||To be exercised as per the Delegation of Powers.|
|15.||Special features||:||Commission to the marketing personnel of different car dealers may be given upto Tk 2000.00 depending on the amount of the car loan.|
|16.||Credit||Customer may default in repaying the loan||A minimum upfront margin of 30% is being maintained. The car financed out of Bank finance is hypothecated to us registered with Bangladesh Road Transport Authority (BRTA). In case of default the car can be seized and auctioned for recovery.|
|17.||Interest Rate||Interest rate fluctuations||Floating Interest rates linked with prime lending rates. In case of fixed interest rate margin over PLR is kept high and as such the NIM is high ab initio.|