loans for a two-wheeler
loans for a two-wheeler

3 Things to Consider Before Getting a Two-Wheeler Loan in India

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Indians and their love for motorcycles is no news.

However, gone are the days when one could buy a bike they like with cash. Motorcycle manufacturers have been increasing the prices of their respective line-ups every month. This led to the current situation where even an entry-level motorcycle costs more than INR 80, 000. 

The price hikes also allowed loans for a two-wheeler to become a mainstream financial product from a niche financial product.

However, when one is applying for a motorcycle loan, one should keep the following things in mind.

It is best to stay away from 0 downpayment loans

0 downpayment loans allow buyers to take the bike they want home without paying a penny as a downpayment. The entire MSRP of the motorcycle will be borne by the lender. The downside of a 0 downpayment loan is that borrowers would have to bear steep interest rates on the borrowed sum. Furthermore, the EMIs for a 0 downpayment loan scheme will be steep as well.

Keep in mind that owning a two-wheeler involves more than just the loan repayment – factor in maintenance costs, fuel expenses, and insurance premiums.

It is best to borrow a small sum

Financial advisors often advise buyers to borrow not more than 20% from a lender while applying for a bike loan. The reason is simple. A small debt is within the borrower’s control. When a debt is small, the borrower is also able to keep their financial history as well as credit score red-flag free.

Small loans are generally easier to qualify for, making them accessible to a broader spectrum of borrowers. Individuals with varying credit profiles or those new to the world of credit may find it more straightforward to secure approval for smaller loan amounts. This inclusivity opens up opportunities for individuals to build or rebuild their credit history responsibly.

It is best to borrow when one’s credit score is high

Borrowers should apply for a loan for long-ride bikes when their credit score is above 750. A high credit score will allow a borrower to enjoy reasonable interest rates. Furthermore, the loan would also entail favourable clauses such as affordable EMIs.

A high credit score empowers borrowers to negotiate better terms. Armed with a strong credit history, individuals can engage in discussions with lenders to secure lower interest rates, reduced fees, and more favorable repayment terms. This negotiating power positions borrowers to extract maximum value from their borrowing endeavors.

To learn more, please consult a professional financial advisor.

Reading reviews and gathering feedback from other borrowers can provide insights into the overall experience with a particular lender.

In Conclusion

embarking on the journey of obtaining a two-wheeler loan in India involves meticulous consideration of loan terms, hidden costs, and your creditworthiness. By navigating these crucial factors, you pave the way for a smooth and financially sound ride. Remember, the road to ownership is not just about the destination; it’s about the journey, and choosing the right loan sets the stage for a fulfilling ride on your dream two-wheeler.

Must Read: What are the Best Selling KTM Bikes in India and What are their Current ex-showroom Prices?

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