Considering the congested Indian roads and rising costs of maintaining high-end four-wheelers, several households are opting for affordable two-wheelers.
A survey by CRIF High Mark, an RBI-approved credit information bureau, depicts that the two-wheeler loan portfolio in India has expanded by 10.6% as of June 2022. According to TechSci Research, the two-wheeler loan market in the country is forecasted to reach approximately USD 12 billion by 2025.
If you are planning to apply for a two-wheeler loan, you need to have a proper strategy in place to help you make the right decision.
Follow this guide to learn more!
6 Tips to Consider Before You Apply for Two-Wheeler Loans Online
Top brands in the Indian market offer favourable loan conditions; for example, if you check out the hero bike price and the latest models, you get the benefit of applying for 95% of this price, and you can take home any model you like. If you meet the right criteria, you can also avail yourself of the benefit of 0-interest two-wheeler loans. In this regard, make sure you compare various loans before applying for one to get the most suitable deal as per your needs.
Here are the top 6 considerations and tips to consider before you apply for a two-wheeler loan:
Check Your Eligibility Criteria
Before you apply for a two-wheeler loan, you must ensure that you meet the eligibility criteria. Several institutions have fixed eligibility for age, income, and employment status of salaried and self-employed individuals.
You must consider each aspect carefully and ensure that you meet the requirements. Keep your employment and flow of income stable to instil confidence in the loan provider that you are capable of paying your monthly dues on time.
Use an EMI Calculator to Compare Different Loans
Two-wheeler loan EMI calculators are free digital tools that are available online, which help you calculate the estimated monthly EMI. This tool takes into account your preferred loan amount, loan term, and the interest rate offered by various loan providers.
You can use it to compare different apps and organisations based on interest offers and EMI affordability. You can also compare different financial institutions based on customer support, lucrative deals, customer reviews, low charges, and easy loan application procedures.
Look for Offers and Deals
There could be seasonal offers and deals on two-wheeler loans on special occasions, which you mustn’t miss out on. Besides, if you stick to your existing financial institution, the chances are that you may get a good loan deal, considering your current relationship with the firm. Do your research well, wait for the right offer, and then apply online instantly.
Apply for the Loan Amount and Loan Tenure Wisely
When considering your loan amount, try and build a saving that contributes towards a large amount of down payment. Although several financial institutions offer 95% sanction of loan amounts based on the market value of the two-wheeler, a lower loan amount ensures low rates of interest and lower monthly EMIs.
Besides a lower loan amount, you must choose a longer two-wheeler loan tenure so that you get the benefit of lower EMIs and better interest rate offers. Longer tenures also build loyalty and credibility and increase trust in your dealings. You also get the chance to make timely payments and boost your credit score.
Keep Your Documents Ready
Before you fill out the bike loan application online, you must keep the following documents handy:
- Your ID, age, and address proof, like your Aadhar card, passport, PAN card, utility bills, rent agreement, etc.
- Income proof
- Financial statements
Boost Your Credit Score
When you apply for two wheeler loan, make sure you check your credit rating. You can expect the best deals on bike loans if you have a credit rating that varies between 700-900. However, if your score is low, then you have to make an effort to boost it to avail the best offers.
In order to do that, you can:
- Strengthen your payment history and not miss/delay any financial obligation
- Clear your outstanding debts
- Maintain a mix of secured and unsecured credit
- Keep your credit utilisation ratio below 30%
- Don’t apply for new debts, loans, or credit cards
- Take the pre-approved credit limit increase options
Bike loans are a gateway to living your dream of owning a two-wheeler at the most affordable loan interest rates, low EMIs, and the most convenient online procedure. Simply follow the above-mentioned tips and trust only the best financial institution for all your needs to fulfil your dream of owning a bike and make informed decisions in the long run.