Read this Before Applying for a Bike Loan

Using a two-wheeler to commute within the city has always been popular with Indians. In the modern world, bikes are becoming the go-to option for many people looking for adventure in the hills or to go for bike trips across the country. A scooter or bike needs less space and can be easily driven even through the heavy traffic during rush hours or on the bylanes of a rustic hill town. Instead of making a full payment, look at financing options to buy a new bike. Getting Finance for Your Two-wheeler Two-wheelers loans come with easy payment options in the form of monthly EMIs at low-interest rates. You need to make a small down payment to bring home your favourite bike and rest of the payment is made on a monthly basis over a number of years or tenor. The monthly repayment is referred to as Equated Monthly Installments or EMI, which takes into consideration both principal amount and the interest to be repaid. However, you have to meet the various criteria set by the lender to be eligible for the Bike Loan - remember the criteria will vary across lenders. Eligibility- Minimum age limit of the borrower has to be 18 years, and the loan amount is sanctioned depending upon the income and creditworthiness of the applicant. Usually, the latest income tax return and valid KYC has to be submitted to obtain the two wheeler loan. The applicant should be in a steady job or self-employed with a regular source of income as it increases the chBike Loanances of sanctioning of the loan amount. Documentation- Simple documentation by the financing bank makes it easier to process the two-wheeler loan within 24 hours and is a hassle-free experience for the customer. All you need to do is fill up a simple loan application and attach the documents like KYC and income to get the bike loan processed in no time. The Rate of Interest- The bike loans and other two-wheeler loans are offered at a competitive rate of interest. The rate of interest is directly dependent on the loan amount, tenor and your creditworthiness. A good credit score with credit bureaus like CIBIL, Equifax etc. enables the lender to assess the financial credibility of the applicant and this may have an impact on the interest rate charged. Keep in mind that even the smallest change in the rate of interest can have an impact on your bike EMI total. You also have the option of pre-closing the loan by paying a small penalty. Repayment- The loan tenure is fixed as per the paying capacity of the borrower, and monthly EMIs can be paid through post-dated cheques, ECS clearing, NEFT, RTGS, IMPS and mobile banking. The tenor of two-wheeler loans usually range from one to four years. Before committing to the repayment plan, the applicant must evaluate his paying capacity and fix the tenor accordingly. Any false commitment should be avoided to remain in the good books of the lender as loan defaulters. Point of Note- If you are unable to make the repayment on time, it can lead to heavy interest rates charged as penalty. Additionally, your Credit score gets negative points, which lowers your chances of rnbeing eligible for any other loan in the future. rnTo sum up, while applying for a bike loan or any other two-wheeler loan, make sure that loan includes registration and insurance costs. Read and understand the loan document carefully and in case of any confusion consult an expert on the matter before signing on the dotted line.