Problem Statement: NRIs have to come to India every once in a while. They come to meet their families and friends and to take care of their property among other things.
Given the condition of Indian roads, traffic and other maintenance issues, two-wheelers make for great automobiles. Some NRIs prefer to have their collection of expensive two-wheelers.
Owning a bike provides the ease of traveling without relying on the public transport, saving a lot of time. The question is, is bike loan for non-resident Indians available to buy a two-wheeler in India?
Fortunately, NRIs can take a two-wheeler loan to purchase their favorite motorcycle.
Non-Resident Indians can take a two-wheeler loan. According to the law, any person who comes under the Foreign Exchange Management Act of 1999 (“FEMA”) can take a loan. Non-Resident Indians come under the law and so they can avail financing for a bike.
It is important to know if you come under the definition of NRI as per FEMA, 1999. According to FEMA, An NRI is “a person resident outside India who is a citizen of India”. If you come under this definition, you are eligible for a Non Resident Indian bike loan.
NRIs need to fit the criteria mentioned below to get a two-wheeler loan in India. The criteria differ from lender to lender, but this is the common criteria across lenders. The following are the bike loan for NRI criteria:
NRIs are supposed to make their loan commitments via their NRO or NRE accounts. These accounts are a must for every Non-Resident of India if they want to do transactions in India.
A Non-Resident External Account is one that an NRI uses to deposit their foreign income. A Non-Resident Ordinary Rupee (NRO) Account is one that an NRI uses for the income that they make in India.
NRIs have to maintain two accounts so that it is easier for tax authorities to scrutinize their income. To take a bike loan for NRI, NRIs are advised to maintain these accounts properly.
The payment is to be made in Indian Rupees only. Most lenders will not ask for a property as collateral. However, if the loan amount is high, banks may ask for a property as collateral or a guarantor.
You have to submit a few documents to get a Bike Loan for NRI. With the digital age, it has become really easy to take a bike loan for NRI.
You can submit your documents online and your loan will get approved shortly. NRIs need to submit a few more documents so that lenders can be assured of their ability to pay back their debts.
Since it is difficult to recover money from someone who lives abroad, lenders tend to be cautious. Here are the following documents an NRI will need to take a two-wheeler loan in India:
Make sure that you have all the documents in order when applying. Ask the lender which documents need to be attested at the embassy. Then, attest the requisite documents. Once you have the documents in order, you will be one step from getting the bike of your dreams.
Loans for non resident Indians can be taken from the comfort of your home abroad. Most lenders now disburse loans online. Every step of the process has been made digital.
Make sure you get your documents attested, scan them, fill-up the form online, and submit your application. It will be a lot easier if you give your power of attorney for this task to someone in India.
For this, draw up a Power of Attorney with the help of your lawyer. Send it to the embassy for attestation along with the fees. Once your PoA is attested, it will be easier for you to get a bike loan for NRI.
Interest rates vary from lender to lender. Interest rates can start from 10% and onwards. The loan processing charges vary from lender to lender and from state to state.
Accordingly, documentation charges also differ from state to state. Stamp Duty will be as per state laws.
The loan foreclosing charges usually start from 4% in the case of a bike loan for NRI. Make sure to consider all the additional charges prior to taking a bike loan.
Two-wheelers are essential for travelling locally in India due to the narrow roads, traffic jams, potholes, etc. As far as bike loans for Non Resident Indians are concerned, NRIs should get their documents in order.
Get them properly attested by the Indian embassy in the country they are working in. Most lenders now have digital options for applying for loans.