Documents required for a car loan in India
Short answer
Lenders follow RBI's KYC rules, so expect to show identity and address proof, such as Aadhaar, passport, driving licence or voter ID, plus your PAN. Most also ask for income proof, recent bank statements and the dealer's quotation. A used car adds the car's own papers. Your lender's own list is the one that counts.
Which identity and address documents do lenders accept?
Banks and NBFCs are regulated by the RBI, and its Know Your Customer (KYC) rules say how a lender must verify who you are. Those rules list the documents that count as officially valid proof of identity and address. They include your passport, driving licence, voter ID card, Aadhaar, the NREGA job card and a letter from the National Population Register. Lenders also ask for your PAN.
If the address on your ID is not where you live now, the lender may ask for a second document that shows your current address. Ask your lender which ones it will accept.
What income proof do lenders ask for?
A lender needs to see that you can repay the loan. What it asks for depends on how you earn:
- Salaried. Recent salary slips, with bank statements showing the salary coming in.
- Self-employed or a business owner. Income tax returns and bank statements, usually rather than salary slips.
- Everyone. Recent bank statements, because they show what you earn and what you already pay out in EMIs.
The exact papers, and how many months of statements, are the lender's choice.
Which documents are needed for the car itself?
For a new car, the lender asks for the dealer's quotation or proforma invoice, so it knows the car and the price. For a used car, it also wants the car's own papers:
- The registration certificate (RC) in the seller's name, with the chassis and engine numbers matching the car.
- The current insurance policy and the pollution under control (PUC) certificate.
- A no-objection certificate from the seller's lender, if an old loan is still recorded on the RC.
- The lender's own valuation of the car, which the lender carries out.
How do I avoid delays?
- Make the details match. Your name, address and date of birth should read the same on every document. A different spelling on one can prompt a query.
- Use statements for the period the lender names. Ask your bank for exactly those months.
- Keep originals to hand. Some lenders want to see them.
- Be upfront about existing loans. The lender will see them on your credit report anyway.
What happens after I submit them?
The lender checks the documents, looks at your credit report and decides. Approval, the amount and the rate are the lender's decision, and nobody can promise them in advance. If something is missing the lender asks for it, and a checklist helps you send everything at once.
Which documents do you need to close a car loan?
When you pay the last EMI, the lender's name is still recorded on the car's registration certificate (RC) as the financier, under what is called hypothecation. Closing the loan means getting that removed. Ask your lender for:
- A no-objection certificate (NOC) or loan closure letter, confirming the loan is fully repaid.
- Form 35, the notice of termination of the hypothecation agreement. It is signed by both you and the lender's authorised representative.
- Any original papers the lender holds for the car or the loan.
You then submit these to the RTO that registered the car, so the lender's name is removed from the RC. Ask the lender, too, to update the insurance policy so it no longer names them as financier. Do it soon after you close the loan: a hypothecation left on the RC becomes a problem the day you sell the car or transfer it to someone else.
The RBI sets a time limit for banks and NBFCs to release original property documents and remove registered charges once a loan is fully repaid, and requires them to compensate the borrower for each day of delay that is the lender's fault. The RBI's notice is linked under Sources below. Your lender can tell you how it applies to your loan.
Questions about car loan documents
Do I need a guarantor for a car loan?
Whether a lender asks for one is its own decision, and it depends on the lender and your profile. Ask when you apply. If you would rather not have one, tell us and we will look at lenders with that in mind.
Are the documents the same for a used car loan?
The identity, address and income documents are the same. A used car adds the car's own papers, such as the RC, the insurance policy and any no-objection certificate from the seller's lender.
Can I apply if I do not have salary slips?
Often, yes. Self-employed applicants are usually assessed on income tax returns and bank statements instead. Which lender suits you depends on how your income is documented.
Is a lender allowed to delay my documents after I repay the loan?
The RBI sets a time limit for banks and NBFCs to release original property documents and remove registered charges after full repayment, and requires compensation for delays the lender causes. Ask for the closure letter and Form 35 as soon as you pay the last EMI, and see the RBI notice under Sources.
Can Radiant Group check my documents before I apply?
Yes. Send what you have on WhatsApp and we will tell you what is missing before you go to the lender.
Sources
- FAQs on the Master Direction on KYC, Reserve Bank of India
- Master Direction on Know Your Customer, Reserve Bank of India
- Release of Movable/Immovable Property Documents, Reserve Bank of India
- Form 35: notice of termination of an agreement of hire-purchase, lease or hypothecation, Ministry of Road Transport and Highways (Parivahan)
Every lender sets its own list. This guide is general information and does not replace your lender's requirements.
Talk to an advisor in Jodhpur
This guide is general information. For your own car, loan or policy, send one message on WhatsApp with what you need and you will get an answer from an advisor, not a call centre.