Bikes and two-wheelers are popular modes of transportation in India. They are not only convenient but also economical and efficient. As a result, the need for bikes and two-wheelers has increased dramatically, with many people buying them for their daily commute.
However, buying a bike or two-wheeler requires careful consideration. Suppose you’re considering buying one soon but need more funds. Financing options can help make your dream come true by providing easy payment options. You don’t have to worry about paying off huge amounts later. There are different financing options to help you buy your dream bike or two-wheeler. This article will discuss the top financing options for purchasing a bike or two-wheeler in India.
Personal Loans for Buying a Bike or Two-Wheeler
Personal loans are unsecured loans that allow you to borrow money from an NBFC without putting up any collateral. By taking a personal loan, you can pay for your bike in full or make monthly instalments until the loan is repaid. The money that you can borrow depends on your income and repayment capacity.
Personal loans range from a few thousand rupees to lakhs, depending on your credit score and income level. Two wheeler loan Interest rate on personal loans may be higher than other secured loans because there’s no collateral involved. However, this might be fine if you want flexibility and convenience!
Benefits of Personal Loans for Buying a Bike or Two-Wheeler
- Unsecured loans
- Range from a few thousand to several lakhs
- Use the funds for other purposes
- Higher two-wheeler loan interest rates compared to other secured loans
Two-Wheeler Loans from various Financial Institutions
Secured loans are a popular option for financing the purchase of a bike or two-wheeler. In this case, you pledge your vehicle as collateral and secure a loan from various financial institutions. The benefits of this type of financing are lower interest rates and shorter repayment tenures compared to unsecured loans. However, prepayment penalties may be charged if you pay off early or default on payments.
Credit Card EMI
- You don’t need to apply for a separate loan.
- You can use your credit card to pay for other purchases as well.
- Credit card EMI interest rates may be higher than other loan options, but if you have an excellent credit score, this could be an option worth considering.
- EMIs may be subject to additional processing fees depending on your lender and the type of card you hold with them (Visa/MasterCard/Amex). These fees vary from lender to lender. Hence, checking with yours before applying for any EMI facility on your bike purchase(s) is best.
Manufacturer financing is provided through partnerships with financial institutions. You can apply for this type of bike loan online, at the dealership, or over the phone. The application process is convenient and easy to complete. The funds are disbursed quickly, and two-wheeler loan interest rates are usually competitive.
However, manufacturer financing options may be limited to certain bike models. Hence, you must check with your dealer before applying for a loan if specific models interest you more than others.
Manufacturer financing may also have higher processing fees than other loan options, such as personal loans from NBFCs (non-banking financial companies). In addition, you must visit the dealership in person when bike loan apply online. Most manufacturers have yet to offer online applications.
With the right financing option, you can make your dream of owning a bike or two-wheeler come true. Personal loans and two-wheeler loans are some of the most popular financing options for purchasing bikes in India. Credit card EMIs and manufacturer financing are also available for customers looking to buy new bikes or scooters online.
When choosing between these different types of loans, consider factors such as interest rates, repayment tenure and processing fees that may impact your monthly outgoings over time.
For example, interest rates on a personal loan will be higher than other types of financing. The difference is that they offer more flexible terms, such as lower monthly instalments or longer repayment periods. The two-wheeler loans tend to have lower interest rates but shorter repayment tenures (typically three years). Compare all these factors before deciding which loan works best for you!
Frequently Asked Questions
Q1: What are the top financing options available for purchasing a bike or two-wheeler in India?
Answer: There are several financing options available for purchasing a bike or two-wheeler in India, including:
- Bike Loans from Banks and Financial Institutions: Many banks and financial institutions offer bike loans with attractive interest rates and flexible repayment options. You can apply for a bike loan online or visit the nearest branch of the bank to inquire about the loan application process and eligibility criteria.
- Two-Wheeler Dealership Financing: Most bike dealerships have tie-ups with banks and financial companies to offer financing options to their customers. These dealership financing options often come with special schemes and discounts, making it convenient for buyers to finance their purchase directly at the point of sale.
- Personal Loans: If you don’t want to opt for a specific bike loan, you can also consider taking a personal loan from a bank or financial institution. Personal loans can be used for any purpose, including buying a bike. However, keep in mind that personal loan interest rates might be higher than bike loan interest rates.
- Credit Card EMI: Some credit card companies offer the option to convert your bike purchase into equated monthly installments (EMIs). This allows you to pay for your bike over a period of time without the need for a separate loan application.
Q2: What factors should I consider when choosing a financing option for my bike purchase?
Answer: When choosing a financing option for your bike purchase, consider the following factors:
- Interest Rate: Compare the interest rates offered by different banks, financial institutions, and dealerships. A lower interest rate can significantly reduce the overall cost of your bike.
- Loan Repayment Period: Check the repayment tenure offered by the financing option. A longer tenure may result in lower EMIs, but you’ll end up paying more interest over the loan term. Choose a tenure that fits your budget and financial goals.
- Processing Fees and Additional Charges: Be aware of any processing fees, documentation charges, or prepayment penalties associated with the financing option. These charges can add to the overall cost of your bike purchase.
- Loan Approval Time: Consider the time taken for loan approval and disbursal. Some financing options offer quick approval processes, which can be beneficial if you need the bike urgently.