You may quickly raise money using two-wheeler loans to fulfill your ambition of being a bike owner. With two-wheeler financing, you can avoid having to pay a sizable sum all at once out of your own wallet. To make sure you obtain the best deal possible when applying for a two-wheeler loan, take into account these five factors.
Conduct research
Financial institutions are presently willing to offer a two-wheeler vehicle loan for the acquisition of a motorcycle or scooter. The terms and conditions of loans vary amongst financial institutions. Additionally, the loan-to-value (LTV) ratio, interest rate, and maximum loan amount vary from one financial institution to the next. Be prepared to pay a variety of fees associated with two-wheeler loans when applying for a loan. These include fees for partial prepayments, foreclosures, loan rescheduling, processing, and other fees.
Look out for any hidden terms when dealing with different lenders as they may have an impact on your loan application. You might even locate a financial institution that doesn’t charge any fees at all for processing loans or loans that are partially prepaid if you do your research well.
To compare the loan EMI with various financial institutions, think about using a two-wheeler finance EMI calculator.
Loan amount
Numerous financial institutions provide loans of up to 90% to 95% of the bike’s worth. The sort of two-wheeler and the applicant’s profile are just two of the variables that affect the LTV ratio. You must evaluate the LTV ratio and loan size offered by several lenders before choosing one.
Never choose a financial institution that has a loan amount that is too heavily leveraged. It’s possible that you’ll find yourself in a situation where the acceptable loan amount exceeds your requirements. In these circumstances, the lender might persuade you to choose a larger loan amount in order to purchase a more expensive bike. On the other hand, going above your budget can damage your finances over time. Your credit score could suffer if you have trouble making your monthly EMI payment.
Affordable interest rate
Financial institutions use a number of variables when determining a loan applicant’s eligibility and vehicle loan interest rate, including their income, age, employment situation, and credit history. Strong creditworthiness will enable you to obtain two-wheeler financing at a reasonable interest rate even if you do not always need it to be approved for a two-wheeler loan.
You should contrast the Annual Percentage Rate (APR) charged by various financial institutions in addition to the loan interest rate. APR comparison is crucial since it takes into account the fees and charges related to obtaining financing for two-wheelers. Choose a financial institution that provides a two-wheeler loan for your ideal bike at a reasonable interest rate as a result.
Special offers
The holiday season is when the majority of financial institutions announce their most alluring loan offers. Some even offer special deals on occasion, like a monsoon sale. These deals could have a lower interest rate, no down payment, 100% financing, no processing fees, and other perks. Additionally, there is a significant probability that your financial institution would offer you lower loan interest rates if you are an established customer rather than a new one.
You might save a significant sum of money on your EMI over the course of the loan payback period if you apply for a two-wheeler loan during a special offer period.
Repayment options
You should research the repayment choices offered by several lenders before choosing one. Check to see if the lender offers loan repayment flexibility. Always keep in mind that the interest component will be bigger the longer the tenure. Check to see if the lender you select offers flexible EMI payment terms. You can swiftly pay off the loan by selecting a plan with adjustable loan EMIs, and you’ll never miss an EMI payment.
