India is a developing nation, which has adopted the policy of fast urbanization. In the next few years, a large population of the country will move to the urban and semi-urban areas. In such a scenario, public transportation is essential. But, public transport is often over-crowded and slow. Therefore, people look for purchasing personal vehicles to commute. A two-wheeler is a perfect option if you are looking for a personal vehicle for daily commuting to office, college, etc. The best thing is that buying two-wheelers is now easy due to the two-wheeler loan. You need to find a lender and check the 2 wheeler loan EMI calculator to plan your monthly loan repayment.
Interest Rates for Two-Wheeler Loans
Two-wheeler loan is a type of personal loan, which you can obtain to purchase a new two-wheeler vehicle. Most lenders offer loans for the new two-wheeler vehicles, though you can also find loans for the second-hand motorbikes. The borrowers should check terms and conditions before borrowing from banks or other financial institutions.
The most important thing is checking the interest rate and hidden charges. A trusted lender does not have multiple hidden charges. But, the lenders may have to pay a high loan processing fee, which varies from one lender to another. Similarly, the interest rates on the loans vary from one lender to another. In the following section, you can find a few tips to find the best two wheeler loan with a low interest rate.
Tips to Find Low-Interest Two-Wheeler Loan
You can find two-wheeler loans in low interest from various lenders. Finding such lenders is not a difficult thing due to the presence of multiple lenders.
Approach a Bank for the Loan
Approaching the bank is the best way of getting a two-wheeler loan in India. A bank comes with multiple banking products and services for the customers. Personal loans for various purposes are the signature products of the banks. However, obtaining a bank loan can be tiresome at times due to document verifications. Ideally, it may take 3-4 weeks for loan approval in the banks. In a few cases, the loan application is processed faster if the applicant is a customer for a long time.
Instead of the public sector banks, private sector banks offer smoother two-wheeler loan approval. The private sector banks use various advanced mechanisms for financial background verification. As a result, the loan approval rate is faster than public sector banks. Moreover, many private banks come with pre-approved loan offers for the existing customers. The pre-approved loans are processed faster than the traditional loan applications.
Focus on Developing a Good Credit Score
You must have a good credit history to obtain the best two wheeler loan from the banks. A person’s credit score depends on the credit repayment history, expenditure, income, and other financial data. Various independent credit management agencies keep records of the customers. The banks or other lenders typically reach such credit management institutions to check credit history.
A person with a credit score higher than 750 points has a high chance of loan approval. But, it does not assure a low interest charge. The loan interest change will be low if you have repaid your earlier loans timely. Therefore, it takes a long time to build such a good credit score to obtain a loan with a low interest rate.
Apply for a Loan during Festive Seasons
Both private and public sector banks come with various loan offers in the festive seasons. According to financial analysts and experts, people like to purchase expensive goods during the festive months. Therefore, banks and other financial institutions come with attractive loan offers to lure the buyers. There are two benefits of applying for loans during this time. Firstly, your loan approval chance is high during the festive seasons. Secondly, you may get a discount on the loan processing fee. Therefore, the overall loan repayment process will be cheaper for you.
Can you obtain a low-interest two-wheeler loan during the festive season? Nobody can guarantee you on this, though you may get some lenders offering low-interest loans during the festive occasions. You should use the 2 wheeler loan EMI calculator to calculate your repayment schedule and monthly EMIs.
Loan with Collateral
In most cases, the two-wheeler loan is an unsecured loan, which comes with a high interest rate. The interest rate can reduce to a large extent if you apply for a secured loan. You can use the existing vehicle as collateral for the loan and obtain money to purchase a new vehicle. Instead of a vehicle, you can use any other expensive asset to apply for such a loan. The approval rate is high, while the interest rate is also low.
You must check the terms and conditions carefully before applying for a two-wheeler loan. Many lenders come with hidden changes, which may create financial hassles during the loan repayment tenure.