If you are planning to buy a bike but do not have adequate funds for paying the price outright, a motorcycle loan would be a good option. You have to make an initial amount of down payment which would be comfortable for you and take loan for the balance amount. There are several options available with different lenders and you can choose a loan with repayment period, interest rates, etc. Knowing the EMI (Equated Monthly Instalments) amount with the help of a EMI calculator in advance would help you. Know about certain other factors that you should consider while applying for a bike loan.
Things that you should check while applying for a two-wheeler loan include:
Type of loan
There are two ways in which you can apply for the loan as per your financial status. Choose any of the loan arrangements that would suit you:
Down payment and loan
You can make a certain amount of down payment while buying the bike and for the rest of the amount, you can take a loan.
Zero down payment
You can take the entire amount of loan without making any down payment. It will be a 100% EMI based financing for your two-wheeler.
Your credit score
Lenders would check your credit score before approving the loan and the minimum score would vary between lenders. If you are taking a loan amount equal to the entire price of the two-wheeler, then the lender may stick to high credit scores as his risk would be higher.
Eligibility criteria and documentation
The eligibility requirements vary between different lenders and the document requirements would differ. Before applying for a loan, check if you fulfil all the eligibility and document requirements.
Affordability check with online bike finance EMI calculator
With the online EMI calculator, you can find out the EMI and estimate whether you would be able to pay the amount every month. If it seems difficult, you can adjust the values to arrive at an amount which you can easily pay beside maintaining your other expenses. It would also help you to decide on the amount of loan you should borrow.
The interest rate varies between lenders. Compare between several lenders to find the lowest interest rate on that would suit you the most. Also, check the other applicable charges so you can manage your fixed expenses also.
Loan tenure or loan term
The tenure of loan repayment will determine the EMI amount that you have to pay every month. Check whether the loan term is flexible enough to accommodate your EMIs and it does not become an additional burden. Based on these conditions, you should choose the lender.
Research regarding available lenders
Check the features and benefits provided by each lender by visiting their websites. This would be an easy and fast way to compare between lenders. It is important as you would be able to shortlist lenders with some of the suitable loan offers.
Seasonal offers and discounts
Buy your bike at a time when you will find several discounts and offers by lenders. During certain festivals or times of the year, you will find that the lenders offer more discounts than other times of the year that include reduction in interest rates.
Once you have selected the lender, check the document requirements that you need to fulfil while applying. Choose a lender who does not have stringent requirement regarding documents as these would delay loan processing.
While applying for a motorcycle loan, go through some important factors like the loan term, interest rates, features, etc. of the loan. Do some online research to get a loan with good benefits, so that you can repay back without stress.