What are the Basic Requirements and Steps for Getting a Bike Loan?
The younger generation of India is crazy about owning a motorbike as driving it gives them an adrenalin rush and it’s a thrilling experience for them to go on a long-distance bike tour. Youngsters from the middle class and rich families make every possible effort to convince their parents to let them purchase their dream bike even if it requires taking a two-wheeler loan from a bank or a private lender.
Bike loans have become immensely popular in India in the last few decades as more and more people are opting for two-wheelers in the metros of India. A bike or a two-wheeler makes life easier in cities where you one has to travel long distances for work or daily chores. If you are planning to buy a bike soon and do not have enough money for a down payment then availing a bike loan is the best option. Bike loans are usually given on a low rate of interest and you can avail them by making a small down payment. Balance payment can be made in the form of EMIs so that you do not strain your monthly budget. If you are planning to buy an entry-level sports bike then several banks that offer two-wheeler loans for best sports bike under 1 lakh.
One needs to do extensive research before applying for a bike loan to get the maximum benefit and it is important to do a comparative analysis of the rate of interest offered by different banks on two-wheeler loans. You must take into consideration the interest rate, loan tenure, and repayment terms before opting for a bike loan. Carefully read the terms and conditions mentioned in the offer letter of the banks and private lenders and check if there are any penalties involved if you plan to foreclose the loan.
The eligibility criteria for a two-wheeler loan is more or less the same for all banks and they assess your eligibility for the loan by taking into consideration several factors. The applicant must be salaried or self-employed to avail of a bike loan. In the case of salaried individuals, they are required to submit salary slips of the last six months along with bank statements. Self-employed individuals must furnish income tax returns for the last three years along with bank statements for the last six months. Address proof and identity proof are mandatory requirements when applying for a two-wheeler loan.
Your credit score is also taken into consideration by banks and private lenders before sanctioning a bike loan. a good credit score with credit rating agencies is a plus point and a bad credit score can reduce your chances of getting a two-wheeler loan. Make sure you know your credit score before applying for a bike loan as a good credit rating can get you a competitive rate of interest. It is advisable to study your credit report before submitting the loan application and ensure that the information is correct without any inaccuracies. If your credit rating is low then it makes sense to postpone your bike purchase till such time your credit rating improves.
Your address proof also plays a significant role in getting a two-wheeler loan as most banks prefer a stable residential address where the applicant is staying. Do not change your residence frequently if you are applying for a bike loan. Define your budget and repayment capacity and work out the repayment plan which suits your requirements. Once you get a sanction letter from the bank, go through the terms and conditions of the loan and make sure you abide by the repayment rules to avoid any penalties.