Whether one wants to move smoothly through narrow and twisted lanes or zip through heavy traffic, driving a two-wheeler is always convenient compared to a four-wheeler. Lower maintenance expenses and greater fuel efficiency are among the key reasons for the growing demand for two-wheelers. Lending institutions offer loans to make it extremely easy to obtain a bike. Minimal documentation and a hassle-free online application help customers to apply for a bike loan for the desired model.
Important Aspects of Securing a Bike Loan
1. Eligibility
Individuals planning to buy a bike or scooter should check their bike loan eligibility before making a two-wheeler loan application. Common parameters to check eligibility are as follows:
– The age limit is 18-65 years.
– A salaried individual’s minimum annual income should be Rs.96000. Minimum limit for a self-employed individual’s annual profit is Rs. 1,20,000.
– A bike loan applicant should have a spotless credit history and a good credit score (750+). It reflects their good creditworthiness and capability to repay the loan on time.
– Residential stability is another aspect of securing a two-wheeler loan. One should have resided in the present city for a certain period, at least one year.
Meeting these eligibility helps individuals to secure a two-wheeler loan at low-interest rates.
2. Interest Rate
Lending rates for two-wheeler loans vary with different lending institutions. Lenders decide the bike loan interest rates based on several factors, including the applicant’s age, employment status, existing liabilities, and credit history. The interest rate can be fixed or floating interest rate. With fixed interest rates, loan EMIs remain unchanged throughout the loan term.
Borrowers can plan their expenses for EMIs they need to pay monthly. A floating interest rate is affected by market forces, and EMIs can increase or decrease depending on the market movement. Customers should check the interest rate type while applying for a two-wheeler loan.
3. Loan Amount
Though interest rates are primarily subject to the applicant’s eligibility, the loan amount is also one of the most important factors a lender considers. A higher loan amount increases the risk for lenders if the borrower defaults. The lender levies a higher interest rate to justify their risk. It can be as low as 6.99% with reputed NBFCs. Two-wheeler loans for women are more affordable, starting at 4.99% only.
4. Loan Repayment Tenure
The repayment tenure is another crucial factor that borrowers must assess carefully. It is the duration to repay the loan amount. Borrowers should choose the loan tenure based on their repayment capacity. Choose a tenure as per the financial capacity. The amount of EMI should not put the borrower in a financial dilemma.
Lending institutions offer bike loans with easy tenures ranging from 12 – 36 months. It takes 12-42 months for special bike loans for women. Applicants should apply for a bike loan with a suitable tenure to meet their EMI obligations without financial hassles.
5. Down Payment
Borrowers can consider how much down payment the lender expects. Typically lenders offer two wheeler finance up to 90%-95% of the bike cost. Renowned NBFCs sometimes offer zero down payment two-wheeler loans. Borrowers can find lenders offering a 100% financing option for a bike loan.
6. Application process
Technological advances have made it easy to get a bike loan online has become so convenient. With the digital expansion, individuals do not require applicants to stand in long queues to apply for a loan. Visit the lender’s official website and apply for a bike loan within minutes against minimal documents.
7. Documents
Two wheeler finance is easily available against minimal documentation. The applicant should be able to produce the following documents:
– Identity Proof: Passport/Aadhar card/Voter ID/PAN (Permanent Account Number)/driving license.
– Income Proof: For self-employed individuals, the latest ITR (income tax returns) acknowledgment, and for salaried individuals, the last three months’ salary slip/Form 16/last three months’ bank statements.
– Residence Proof – Any government-issued ID/certificate.
Individuals looking to purchase a new two-wheeler but lacking enough funds can step closer to their dream bike through a loan. Own a two-wheeler loan with zero down payment and repay the loan in EMIs with a tenure that suits your financial comfort.