Car Loan EMI Delay Charges: Late Fees, Penal Charges, and How To Avoid Them

Car loan EMI delay charges are additional amounts that may become payable when a scheduled EMI is not received by its due date. Depending on the applicable loan terms, these may include a bounce charge when an EMI payment or mandate fails, or a penal charge for delayed repayment. The amount and calculation can vary based on the terms of the car loan and the circumstances of the delay. An overdue EMI refers to the scheduled instalment that remains unpaid until the required payment is received. Other charges may also apply if they are specified in the applicable loan terms. Borrowers should check their loan agreement and statement of account to understand the charges applicable to their account. Paying the overdue amount promptly can help prevent the account from remaining unpaid for longer.

Late payment charges and penal interest on a delayed EMI

A late payment charge and penal interest are two separate costs that can apply to an overdue car loan EMI, and both depend on the terms of your specific loan agreement. The table below explains how each one works.

The exact amount for each charge depends on your loan agreement. Check your loan account statement or contact your lender to confirm the charges applicable to your loan.

If your car loan EMI is overdue, making the required payment promptly can help you regularise the account and avoid the overdue amount remaining unresolved. You can use the Bajaj Finance App or Customer Portal to check the amount due and complete the payment through an available online payment option.

Follow the steps:

1. Log in to the Bajaj Finance App or Customer Portal using your registered mobile number.
2. Go to your car loan account and check the overdue amount, including any applicable late payment charge or penal interest shown.
3. Select the payment option and choose your preferred payment mode, such as UPI, net banking, or debit card.
4. Complete the payment and save the transaction confirmation for your records.
5. Check your loan account after the standard processing time to confirm the overdue status has been cleared.

After completing the payment, save the transaction confirmation for your records. Allow the standard processing time for the payment to reflect in your loan account, then check the account status to confirm whether the overdue amount has been updated. If the payment does not reflect as expected, keep the transaction details ready when contacting the lender through an official channel. 

What happens if you delay a car loan EMI?

A delayed car loan EMI can increase your outstanding dues and may affect your credit record if the overdue amount remains unpaid. A single delayed payment should not be treated as an isolated cost if it remains unresolved. The overdue amount can continue to affect the account until the required payment and applicable charges are received.

Repeated or prolonged delays can have wider consequences, including:

• Higher amount payable: Applicable delay-related charges can increase the amount required to regularise the account.
• CIBIL impact: A default that remains unpaid for 30 days can affect your credit record. Continued overdue payments can have a more significant effect on your credit profile.
• Recovery follow-up: Continued non-payment can result in further communication regarding the overdue account.
• Legal process: Where an account remains unpaid, and recovery action progresses, the borrower may receive formal notices or other communications in accordance with the applicable process.
• Vehicle-related recovery action: In applicable cases, continued default may lead to recovery measures relating to the financed vehicle, subject to the loan terms and applicable law.

Receiving a legal notice means the account requires prompt attention. Read the notice, verify the outstanding amount, and follow the payment or response instructions stated in the communication.

How can you avoid car loan EMI delay charges?

Making your car loan EMI payment on or before the due date is the most effective way to avoid charges associated with delayed repayment. To maintain a consistent repayment routine, track your EMI due date and mark it on your monthly financial calendar. Ensure your repayment account has sufficient funds before the scheduled deduction and check that the linked payment mandate remains active to process the EMI. After the due date, monitor your loan account to confirm that the payment has been successfully processed. If an EMI fails or remains unpaid, check the outstanding amount and any applicable charges and make the required payment through an authorised channel. Reviewing your loan statement regularly can also help you identify overdue amounts and charges. If you already have an overdue EMI, consider clearing the outstanding amount at the earliest.