Owning your dream bike can bring a sense of freedom and confidence. As an enthusiast rider, it enables you to go on long rides and explore places you will eventually fall in love with. With the rising prices of two-wheelers, it can put a great burden on your finances. However, it does not mean that you should give up on your dream of owning a bike.
You can apply for a bike loan and get your dream bike without constraining your monthly budget. The process of applying for a bike loan is easy and hassle-free. Some lenders offer up to 100% of the bike’s on-road price as a loan at the most affordable interest rate.
Things to Consider Before Applying for a Bike Loan
Not all lenders offer the same services in terms of bike loan interest rate, repayment tenure, and loan amount. It is imperative to consider the following factors to get a bike loan that best suits your needs and preferences.
- Loan amount
The loan amount is a crucial factor to consider while buying your bike on finance. You can get up to 80% to 100% of the vehicle’s value as a loan. However, your lender may offer you a loan amount that is lower than your bike’s price. It would be wise to find a lender that offers a considerable loan amount with a higher loan to value ratio to buy your dream bike. It is worth noting that your loan amount depends on factors like your gender, income, repayment capacity, etc.
- Eligibility criteria
Each lender has specific requirements that you will need to meet before applying for a loan. Find a lender whose bike loan eligibility criteria match your profile. Here are the requirements to meet:
- You must be either a salaried employee of an organization or a self-employed professional.
- You must be at least 18 years old at the time of application and 65 years during the loan maturity.
- You must earn a minimum income and profit based on your nature of employment and your lender’s policy.
- Equated monthly installment (EMI)
You will need to repay the loan amount with interest in easy EMIs. Since your EMI is dependent on your loan tenure, you need to choose an EMI that suits your monthly budget. You can use an online bike loan EMI calculator to determine how much you can afford to pay every month. Knowing your EMI beforehand enables you to choose the right lender for your bike loan.
- Repayment facility
Besides a lower bike loan interest rate, you must also ensure that you can get flexible repayment options. For instance, you should be able to foreclose or prepay a portion of your loan amount without incurring a heavy penalty. So, while applying for a bike loan, make sure to choose a lender that offers flexibility when it comes to loan repayment options.
- Downpayment
Some lenders may offer only up to 80% of the loan amount as a loan. It means that you will have to pay the remaining 20% as a down payment. For instance, if your bike costs Rs. 100,000/-, you can avail of Rs. 80,000/- as a loan and pay the remaining Rs. 20,000 as a down payment. Keep in mind that the higher the down payment, the lower the bike loan interest rate.
- Bike loan process
The process of getting a two-wheeler loan is simple and convenient. You need to meet the eligibility requirements and submit your application online to avail of a quick loan. However, it is advisable to check your lender about their loan application process and the time taken to disburse the sanctioned loan amount.
- Additional charges
You do not only pay your bike loan interest rate. There are several other charges hidden in your bike loan agreement. Before proceeding with your preferred lender, you must carefully read the fine print in the agreement and ensure to agree with the terms and conditions of your bike loan, and then sign the papers.
