Do you want to buy your dream bike but aren’t sure how to come up with the money? Set aside your concerns. You can get a two-wheeler loan to help you fund your goal of owning a bike. Here are five things to think about before you apply for a two-wheeler loan to make sure you get the best offer.
Conduct research about the two wheeler loan
The loan terms and conditions vary depending on the banking institution. In addition, interest rates, maximum loan amounts, and loan-to-value (LTV) ratios vary by financial institution. Be ready to pay various expenses associated with two-wheeler loans, such as processing fees, when applying for a loan.
Check with different lenders for hidden provisions that may affect your loan application form. You might even locate a financial institution that charges minimal or no costs for loan processing or portion prepayment if you do your homework.
Many financial organizations provide loans up to 90% to 95% of the value of a motorcycle. The LTV ratio is determined by a variety of factors, including the type of two-wheeler and the applicant’s background.
Varying lenders provide different LTV ratios and loan amounts. You don’t want to find yourself in a scenario where your chosen bike is worth Rs 1,00,000 but the lender will only grant you Rs 20,000. As a result, choose one that disburses a loan quantity that is suitable for your requirements. The loan amount should never be over-leveraged when choosing a financial institution. You can find yourself in a situation where the available loan amount exceeds your requirements. In such circumstances, the lender may try to get you to buy a more expensive bike by requiring you to take out a larger loan. Going overboard with your spending, on the other hand, can cost you money in the long run. You may find it difficult to repay your monthly EMI, causing a blemish on your credit report.
Affordable interest rate of the two wheeler loan
The applicant’s income, age, employment status, and credit history are used by financial institutions to evaluate loan eligibility and interest rates for two-wheeler loans. Although you do not always need a good credit past to get a two-wheeler loan, having a good credit history will assist you to get a two-wheeler loan with a low-interest rate.
Compare the Annual Percentage Rate (APR) offered by various financial institutions, as it includes the prices and expenses associated with obtaining two-wheeler financing. As a result, it is advisable to select a financial institution that provides a two-wheeler loan at a reasonable interest rate.