The application process for a two-wheeler loan is quite simple and easy too. You require very few documents. If the lender approves your application, it is possible that you may get the loan within the same day. There are several two-wheeler companies providing loans but the loan terms and eligibility criteria would differ. There are certain factors that you should consider before finalising a two wheeler loan. This would help you save a significant amount of money too. Some of the factors include comfortable terms and conditions, low-interest rates, flexible repayment period, etc. Read further to know about them in detail.
Note the following points while selecting a two-wheeler loan:
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Conduct some research
If you want to select a lender who offers two-wheeler loans, then go through the online portals of several lenders in your location and check their terms and conditions, 2 wheeler loan interest rates and maximum loan amount that they would offer. Also, check the various fees and charges. Use an online two-wheeler finance EMI (Equated Monthly Instalment) calculator and compare the loan EMI between different financial institutions.
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The hidden clauses
Sometimes lenders introduce hidden clauses that can affect your loan amount, for example processing fees, other charges, etc. Check for these things before you submit your loan application.
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two wheeler loan amount
Many finance companies would offer two-wheeler loans up to an amount of 100% of the two-wheeler price while others may offer 90-95% or lesser. This is called the Loan to Value (LTV) ratio. It depends on the type of two-wheeler that you buy, like a brand-new or 2nd hand. Some lenders would additionally consider your profile, source of income, credit history, etc. Compare the LTV ratio by different lenders and choose one that offers the maximum loan amount related to the bike price. Also, check whether the EMI amount is okay for you when you finalise the loan amount. You should be able to pay it without difficulty. It should be affordable.
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Interest rate
Check the interest rate that the lenders are offering. It would depend on your age, income, employment status, credit history, etc. Select a lender who offers a low-interest rate.
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Special offers by lenders
You will find that two-wheeler finance companies sometimes offer attractive discounts during festive seasons, particular periods like monsoons, winters, etc. The offers include low-interest rates, zero down payments, no processing fees, and 100% financing. If you are an existing client, your lender may give you additional benefits compared to new applicants.
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Repayment option
Choose a lender who would allow flexible EMIs, so that you can repay back the loan quickly without paying higher interest. There can also be other expenses like part prepayment charges, foreclosures charges, loan rescheduling charges, etc.
The EMI calculator is available on a lender’s website and you do not have to log in or create an account to access it. The reasons for using the calculator include the following:
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Avoid manual calculations
Manual calculations take a lot of time and there is a high chance that you would make mistakes. The EMI calculator is an automatic tool for making difficult calculations and you would always get the correct results. It also calculates very fast.
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Easy to use
The calculator is easy to use and simple too. You just have to put in the numerical values of principal, interest, and duration of the loan to get the EMI. There is no complex method involved.
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Secure method
It keeps your personal details safe. The two-wheeler EMI calculator does not store your identity. There is no sharing of personal details.
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Easy to access
You can use it anywhere and at your convenience with a mobile device. Access it from your smartphone, laptop, tablet, or desktop with a stable internet connection.
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Affordability check
You can decide whether you would be able to repay a certain loan amount every month after availing of a two-wheeler loan. If it is difficult, adjust the values to get an amount that you can easily pay and maintain your other expenses as well. If you miss an instalment, you may have to pay a late payment charge that would also affect your credit score. So, the calculator helps you to decide on the amount of loan that you should borrow.
Before selecting a lender and deciding on the loan amount, consider certain factors that can affect the EMI amount and tenure of repayment. There are several two-wheeler finance companies but you should select those who offer loans with easy terms and conditions. It would be quite easy for you then to repay back without having any financial stress. Scanning all these criteria would help you choose the best two wheeler loan among several offers by lenders.
