Friday, December 9

What to remember before seeking a Two-Wheeler Loan in Hyderabad

Bringing to your home a new two-wheeler, bike or scooter gives you immense joy as it offers you the freedom to travel with comfort. It will save you from the madness of traffic that a city experiences during peak hours. You can get rid of traveling in public transport amidst crowds in an uncomfortable manner once you own a two-wheeler. Bike loans are an easy form of financing without compromising your hard-earned savings. A bike loan is easily available across India from a lot of financing companies. If you are seeking a Two Wheeler Loan in Hyderabad, you can explore a lot of such options online. But before jumping on a bike loan. You should check the interest rate because this is the aspect that proves crucial in the overall affordability of the loan.   

Hyderabad is an important city in the country and a two-wheeler gives you sheer comfort on its busy roads. Furthermore, the convenience of repayment of bike loans in flexible tenures with affordable EMIs makes a bike loan even more appealing to youngsters. When you apply for two-wheeler loan. You should know what the factors that determine the interest rate of your loan. Knowing these factors will help you improve your chances of getting a loan at a lower interest rate.

Flexible down payment

The down payment refers to the amount that you need to pay at the time of purchasing the bike. Apart from the loan amount. A majority of the financing companies will bear only 70 percent of your loan amount. And the remaining value will be paid from your pocket, this is called a down payment. You will find many lenders who will offer zero down payment facilities. But those come at higher interest rates as some risk factor associated with it. So you must understand that the interest rate of your loan will be determined by your down payment amount. So go with a lender who offers flexible and transparent down payment facilities. It is better to choose a lending company that will give you the lowest interest rate. Which you can repay even when you get the loan with 100 percent finance.

Income of the borrower

The income of the borrower is directly linked to the interest rate. The amount of your net income is calculated against the amount of EMIs of your bike loan to establish the risk of giving you the loan. The general rule is that if you are a salaried individual your interest rate will be lower as you have a stable job and a regular monthly income.

The type of bike

The type of bike you arebuying also impacts the rate of interest on the bike loan. If you are purchasing a luxury high-end bike, your interest rate will be lower as it will be a high-value loan. An important factor here is that popular high-end models can offer more resale value for the lender, and it will be easy for him to recover the losses later in case you default on the loan.

The ability to pay back

The repayment is a great aspect to consider when you apply for two-wheeler loan. As a borrower, your capacity to repay the loan will be examined by the lender against the monthly installments he offers for your bike loan. All your outstanding debts will be examined to determine the loan-to-value ratio of your loan and based on that your loan amount will be finalized and your interest rate will be fixed.

Duration of the loan

A longer loan tenure will result in higher loan interest. The reason behind this is that a longer loan term increases the chances of default behavior on the part of the borrower. If the risk is involved with the loan the lender always charges a higher interest rate to recover the loss. So, if you are considering a lower interest rate you should opt for a shorter tenure. But at the same time, you should be careful about one thing a shorter tenure often results in higher monthly installments and this might create a burden for you. You can use the two-wheeler loan calculator to know about the most affordable EMI you can pay with the shortest tenure. This way you can keep the EMIs affordable for you and obtain the loan at the best interest rate.

The reputation of the employer

If you work with a renowned employer this will work in favor of you getting the loan. A good employer means your job is stable. Having a government job or working at a multinational company will get you a loan at a lower interest rate because of the credibility factor associated with it.

To conclude

In the process of acquiring a Two-Wheeler Loan in Hyderabad, knowing these factors will help you when you approach a financing company. You can prepare ahead for your bike loan by maintaining a good credit score and lowering your debt or increasing your monthly income.

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