Driving a new car seems like a dream for many, especially those who are unable to afford to buy a vehicle by cash. While a personal or car loan seems to be the ideal solution for people who wants to drive a new set of wheels, those who are national self-employed in the UAE often find themselves at a disadvantage.
Fortunately, there are some banks in the region that allow self-employed UAE Nationals to apply for a car loan. These interested individuals should take note of the minimum requirements and understand how much they will be expected to pay back.
Requirements For Self-Employed Car Loans In UAE
Those who are looking to get approved for a car loan need to ensure they meet at least a set of minimum criteria before submitting an application. The first step would be to find a bank in the UAE that does offer these services to self-employed individuals. Once this type of financial institution has been identified, learning more about the specific criteria that they might have is important.
Generally, the self-employed individual will need to be at least 21 years old. They will also be required to have a driving license that is valid in the UAE since the applicant is looking to buy a car with the loan.
The person will also need to present some kind of ownership documentation to provide the bank with evidence that they are true, the owner of the business that they are running. In most cases, bank statements or another type of document that serves as proof of income will be a requirement as well. These are important as it allows the bank to see that the person is getting a monthly income and that they will be able to repay the money that is needed for the new car.
Those individuals who meet the minimum requirements for a self-employed car loan will need to provide the bank with identification documents, as well as a quotation for the vehicle that they are interested in buying with the car loan. An auto loan application form also needs to be completed.
Typical Repayment Plans
The specific repayment terms depend on a few factors, such as the amount needed, the current interest rate, the number of months the customer needs to pay back the money, and the individual’s current credit status.
Here is a basic example just to help you get an overview of what is taken into the calculation:
Car price: AED 200,000
Car loan amount: AED 150,000
Repayment terms: 72 months
Annual interest rate: 5%
In this scenario, the monthly installment will be approximately AED 2,279, and the total amount repaid by the end of the terms would be AED 164,092.
Applying for a car loan can help a person get a new set of wheels, perhaps when their old car has broken down or when they simply feel like getting an upgrade. Those who are self-employed often find it hard to get approved for these loans, as a referral letter from an employer is often needed. Fortunately, some banks to offer self-employed car loans to UAE Nationals, but it is important for the person to meet the minimum criteria.