The metropolitan cities are getting overpopulated due to which reaching work on time has become a challenge. Besides that, the social distancing norms of the COVID-19 pandemic make it a necessity to own a two-wheeler. A two-wheeler enables you to navigate through daily traffic and get one step close to freedom from the public conveyance.
But, with the increasing prices of bikes and the reduction in everyone’s income due to the crisis induced by the pandemic, not everyone can afford to buy a two-wheeler. If you do not have the funds to own a bike, you can still apply for a two-wheeler loan that allows you to manage your finances without touching your savings.
A two-wheeler loan is the best option to buy your dream bike without causing any financial burden on your shoulders. Depending on your lender, you can even get up to 100% of the vehicle’s on-road price as a loan. It comes with affordable interest rates and flexible loan tenure, enabling you to make loan repayments without any delays or defaults.
Furthermore, you can use a two-wheeler EMI calculator on your lender’s website to determine your affordability and figure an EMI based on your needs and preferences.
The top benefits of opting for a two-wheeler loan are:
- Affordable interest rates
Due to the high competition in the market, lenders are racing to offer affordable two-wheeler loan interest rates to borrowers. You can find lenders that offer interest rates as low as 0.99%. However, it is worth noting that the interest rate depends on factors such as the lender, loan amount, income, employment status, credit score, current financial obligations, etc.
Your lender will offer you an interest rate based on the eligibility factors. If you wish to get a lower interest rate, you will need to meet the eligibility requirements of your lender. You can also use a two-wheeler EMI calculator to understand how much you can pay in EMIs based on the loan amount, interest rate, and loan tenure.
- Reduce financial burden
The crucial reason that most borrowers opt for a two-wheeler loan is that it can significantly reduce the financial burden via affordable EMIs. When you take a loan, you need to pay a certain percentage of the bike’s value as a down payment. A higher down payment leads to a lower loan amount, and a lower loan amount always translates into a lower interest rate.
Also, with the use of the two-wheeler EMI calculator, you can determine how much you can pay in EMIs every month, reducing the burden on your monthly budget. It is the best way to manage your finances without having any financial stress.
- Maintain a healthy credit score
Your credit score is a three-digit number provided by the Credit Bureau of India. It contains information about your credit history and credit behavior based on which your lender determines your creditworthiness. A higher credit score ensures a lower interest rate. Besides, a two-wheeler loan also helps in improving your credit score and secure loans in the future if you make on-time repayments.
- Relaxed eligibility criteria
Both salaried and self-employed individuals can apply for a two-wheeler loan, provided they meet the eligibility requirements and are a bare minimum. Here are the eligibility criteria that are common across all lenders in India:
- You must be an Indian citizen to apply for a loan
- You must either be a salaried employee of an organization or a self-employed individual.
- You must be at least 18 years old while applying for a loan and 65 years old at the end of the loan tenure.
- As a salaried employee, you must earn a minimum net income based on your lender’s policy/
- As a self-employed individual, you must show a minimum net profit based on your lender’s policy.
You will need to check your lender’s website to know about their eligibility criteria before applying for a loan.
- Figure out an affordable EMI
Before applying for auto loan, you can find out how much you can afford to pay every month as EMIs. You can determine your EMI affordability through a two-wheeler EMI calculator available on your lender’s website. There are three main components of a two-wheeler EMI calculator – loan amount, interest rate, and loan tenure. You can change their values in the calculator to figure out a suitable EMI for yourself.
If you are short of money and want to buy a two-wheeler, it is advisable to apply for a two-wheeler loan to achieve your goals. Make sure that your two-wheeler loan has a lower interest rate to reduce the financial burden on your shoulders.