Two-wheelers have always been popular among Indians particularly because it is a lot more affordable than four-wheelers, convenient to drive and a time-savior during huge traffics, especially in metro cities. However, as inflation is increasing, so are the prices of two-wheelers.
Nonetheless, financing for two-wheeler loans is not a big deal nowadays. The price of mid-range two-wheelers usually starts from Rs. 70,000, and for dream bikes like Royal Enfield, it is usually around Rs. 2,00,000 - Rs. 3,00,000, taking a loan is usually preferable than having to cut that big a hole in your pocket. Owning a two-wheeler is more of a necessity than choice or luxury because they are economical and preferable for short-distance travel. Also, the introduction of electric two-wheeler vehicles and a constant rise in fuel prices has brought a steep rise in the two-wheeler market due to its benefits, including tax benefits and government schemes.
It is pertinent to note that 75% of two-wheeler purchases are funded through loans. So, if you have decided to purchase your dream bike or any other two-wheelers and are looking to avail two-wheeler loan, then the following points will assist you for the same:
A credit score is the primary indicator of your creditworthiness based on your past credit performance and repayment history. The maximum score is 900 and depends on whether you timely repay your debts or not. Credit rating agencies like CIBIL provide the credit score, which all the financial institutions recognize. Their decision to sanction or reject the loan is influenced by it, and a credit score above 750 points is considered good by almost all financial institutions. Therefore, the most important thing before applying for any loan is knowing your credit score. This will make most of the things clear to you in advance. It will help you decide on the financial institution you want to pursue and give you an estimated idea of the interest that will be charged from you.
Even though the credit score is a good indicator of your creditworthiness, it is not the stand-alone criteria that the bank considers. There are other parameters that the bank considers for evaluating your eligibility for availing of two-wheeler loans. Even though every bank has different criteria for evaluating eligibility, they are not that difficult to satisfy. The basic criteria used by most of the banks include KYC documentation, Income Tax Returns (at least for the last one or two years as per the bank's criteria), minimum income, credit score, minimum and maximum age criteria, residential address etc. You can check your eligibility for a two-wheeler loan in Shriram City Two-Wheeler Loan criteria.
The maximum amount of loan that you can get will be influenced by the judgment that the bank takes based on the above two steps. Also, if your credit history is good, the bank may give you most of the market value of the two-wheeler as the loan. Some financial institutions may have the criteria of a minimum down payment. Also, many financial institutions demand zero down payments. Therefore, if you are looking for a zero down payment bike loan or want your scooty down payment to be as low as possible, you can check it out here.
The process of applying for a two-wheeler loan is really simple, and many financial institutions also provide online facilities for applying for a two-wheeler loan. You can get a two-wheeler financed quickly without any hassle. Basic documents like income tax returns, bank statements, KYC documents can be uploaded online, and the bank will complete the remaining process.
The tenure of a two-wheeler loan is not as long when compared to the tenure of a home loan or other loans and is influenced by the amount of loan sanctioned, two-wheeler loan interest rate charged and the down payment made. The amount sanctioned is usually around Rs. 60,000 to Rs. 1,00,000, and the interest charged is usually anywhere between 10%-20% per annum, depending upon the bank and the profile of the customer. If you are purchasing your dream bike, then the loan amount sanctioned may go up to Rs. 2,00,000 also. Here, EMI will increase a bit, and tenure may also increase. Generally, the tenure of two-wheeler loans is around 2-3 years. If you want to know the amount of EMI that you will need to pay, you can use a two-wheeler loan EMI calculator. Just fill in the loan amount, tenure, and rate of interest, and you will get the EMI amount. You will get to know how much of your monthly income needs to be allocated for the loan.
The time is changing and there is a paradigm shift in the choices of two-wheelers. With the advent of electric two-wheelers, many people are choosing them instead of conventional petrol two-wheelers. It has the upper hand when compared to petrol vehicles as the price gap between the two is lesser, and benefits are more. It almost eliminates the fuel cost and requires less maintenance. The only cost incurred is the electricity cost for charging the battery, which is minimalistic when compared to the petrol cost. Considering its environmental benefits, even the government is extending the support for two-wheelers. Electric two-wheelers are eligible for a subsidy of Rs. 15,000 per kilowatt-hour [as of 2021], making it even more affordable. Also, to provide even more encouragement to the people to go for electric two-wheelers, the government inserted section 80 EEB under the income tax act, which provides a deduction of Rs. 1,50,000 for the interest paid on the loan taken for the electric vehicle. Therefore, you can take this benefit and save the tax up to 10%, 20% or 30% on the amount of interest paid depending on the tax slab under which your income falls. Therefore, with so much support from the government, people have now started using electric vehicles, especially two-wheelers, which has led to a further increase in the demand for two-wheeler loans. The above information is essential for anyone who wants to purchase their dream bike or any other two-wheeler. You can get the best two-wheeler loan through a Shriram two-wheeler loan. With a minimum and hassle-free process, you can get the loan sanctioned within a minimum time.