Best Car Loan Rates in India – July 2025

 Here are the Best Car Loan Rates in India – July 2025, based on publicly available rates from leading banks and recent RBI actions 📉

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📉 Best New Car Loan Rates (July 2025)

Bank / Lender	Starting Rate (p.a.)	Notes
SBI	8.15% (EVs) / ~8.30–9.00% (Non‑EVs)	Special rate on electric vehicles. No foreclosure fee after 2 yrs.
Bank of Baroda	8.15%	MCLR rate cut following RBI repo reduction.
Canara Bank / PNB	~8.70%–8.90%	MCLR cut by 5–15 bps from May 2025.
Axis Bank (New Car Loan)	~9.30%	Floating rate, varies by tenure and credit score.
ICICI Bank	9.10%	On-road funding and flexible tenures available.
IDFC FIRST Bank	9.75% – 11.50%	Depends on loan tenure (11–120 months).

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🚗 Used Car Loan Rates

• Used Car Loans tend to start at 9.75% and can go up to 15.8%, depending on tenure and borrower creditworthiness. 

📌 Why Rates Are Dropping

• In June 2025, RBI slammed the repo rate down to 5.50%, its third reduction this year—leading to lower lending costs across the banking sector. Bank of Maharashtra, BoB, PNB, and Canara Bank all followed suit with 5–50 basis point rate reductions. 

✅ Recommended Picks & Strategy

• For the lowest possible rate, head to SBI:

  • 8.15% for EV loans

  • ~8.30–9.00% for non-EV financing

• Bank of Baroda offers a competitive 8.15% across car loans now.

• ICICI Bank and Axis Bank remain strong private-sector options, offering sub-10% rates with better flexibility.

• IDFC is another option, though rates may trend higher for longer tenures.

• If you’re buying a used car, expect rates in the 9.8%–15.8% range—choose short tenure and better CIBIL to get lower rates.

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💡 Tips to Secure the Best Rate

1. Maintain a CIBIL score of 750+ for most favorable pricing.

2. Take a floating rate loan to benefit from further RBI cuts.

3. Pay 20–25% down—a higher down payment usually fetches better terms.

4. If offered, opt for zero foreclosure policies (available at SBI).

5. Compare across lenders—don’t just rely on one bank.

6. Time your loan application during festive or promotional periods—they sometimes waive processing fees or offer discounts.

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✅ Final Take

As of July 2025:

• SBI offers the lowest car loan rates (as low as 8.15% for EVs).

• BoB, Canara, and PNB are offering competitive 8.15–8.90% range for new car loans.

• Private banks like ICICI and Axis remain reliable for customized offers within the 9–10% band.

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Would you like:

• 🧾 A customizable EMI table showing monthly costs at different rates and tenures?

• 🧠 Tips on negotiating or comparing offers based on your CIBIL score and down payment?

Let me know—happy to help tailor it further!