Money borrowed from a bank towards purchase of an Auto/ Vehicle is termed as Car Loans. The vehicle purchased is the collateral for this loan and thus this loan is also referred to as secured loan. Car Loans are payable through the period of 3 to 7 years.

There are multiple banks offering the Personal Lona facility in UAE. The basic requirements are regular income and resident visa (banks of course require more details to approve the loan). You can explore the SoulWallet’s Car Loans page to search for the banks which potentially can help you with your need.

EMI is Equated Monthly Installment defined as “A fixed amount paid by a borrower to a lender at same time each calendar month. EMI is a combination of the interest and principles ensuring that over a specified number of years, the loan is paid off in full.”

AECB is AL Etihad Credit Bureau - an agency that collects and maintains individual credit information from banks & financial organizations and provides it to lenders, and consumers in the form of a credit report.

A credit report is Issued by a Credit Bureau (AECB IN UAE) which includes record of current and previous credit facilities, Payment history over the last 24 months, Payments overdue and Records of any defaults.

Primarily there are three types of documents required by the banks for any loans i. Identity Documents – Passport/ Emirates ID/ Visa / Family Book for UAE Nationalsii. Income Documents – Salary Certificates/ Bank Statement/ Audited financials (for self-employed)iii. If the loan is An Auto or Home loan – all the related documents to the asset being purchased with the loan amount.

DBR is Debt Burden Ratio and is used to measure an individual’s ability to manage monthly payment and repay debts. DBR is calculated by dividing total recurring monthly debt by gross monthly income, and it is expressed as a percentage. DBR is capped at 50% by the Central Bank of the UAE

Flat interest rate is an interest rate calculated on the full original loan amount for the whole term without taking into consideration that periodic payments reduce the amount loaned. In other words, interest is charged on the full amount of the loan throughout its loan tenure.Under reducing interest Rate, interest is calculated every month on the outstanding loan balance. EMI payment every month contains interest payable for the outstanding loan amount for the month plus principal repayment. On every EMI payment, outstanding loan amount reduces by the amount of principal repayment. Thus, interest for next month is calculated only on the outstanding loan amount as reduced by the principal repayment this month.

A deferment is a temporary arrangement which allows you to postpone your EMI payments by a certain period of time agreed between you and the lender. There is generally a service fee for availing this facility.

Each bank and type of loan will have different charges on availing the loan, but processing fee is payable across. Periodically banks come out with offers of waiver on these fees as a special promotion and you should keep a check on the SoulWallet loans paged to see these.

Credit Insurance is insurance that you purchase when you take out a loan that protects both you and the lender in the event that you are unable to pay the loan due to death. This is generally a onetime fee that is paid on the loan amount availed.

Yes, most banks will give you the option of paying back your loan earlier subject to applicable fee and terms agreed at the time of availing the loan. This is called “Early Settlement”.