Two-wheelers are considered profitable in the face of rising fuel prices. This is why the two-wheeler is the preferred means of transport for Indian families. When you take out a loan to buy a two-wheeler, it helps you buy your favorite vehicle and improves your credit score if you repay your loan on time. Taking advantage of a two-wheeler loan can be a good idea when you don’t want to mess with your cash flow or you lack the cash to buy your favorite bike or scooter.
Here are some tips to help you get the best rates on a two-wheeler loan.
Check your credit score
Adhil Shetty, CEO of Bankbazaar.com, explains, “A clean credit history and a good credit rating are prerequisites for availing a two-wheeler loan at an attractive interest rate. It also assures financial institutions that loans to you are risk free. »
On the other hand, if your credit score is bad, the bank charges extra interest as a risk premium on top of the regular interest rate on two wheeler loans. With a credit score of 750 and above, you can easily avoid the risk premium and get the two-wheeler loan at the lowest interest rate available. Always check your credit score beforehand, and if it’s not good enough, take corrective action to improve it before applying for a two-wheeler loan.
Compare interest rates
Interest rates and fees on two-wheeled loans vary from bank to bank. Thus, it is advisable to compare the different two-wheeler loan products available before applying. Compare loans based on metrics like interest rates, processing fees, and other fees like penalties, prepayment fees, pre-closing fees, late payment fees, and more.
The interest rate on two-wheeled loans in the table below will help you compare interest rates and take a call as needed.
Compiled by Bankbazaar.com
Data collected from the respective bank’s website as of June 20, 2022. The lowest interest rate offered by banks on two-wheeler loans is shown in the table, regardless of loan amount and term. The interests mentioned in the table are indicative and for information purposes only. The interest rate may vary in the actual state depending on the applicable terms and conditions of the bank.
Check the links
You have two options for getting a two-wheeler loan. Choose the lender for the loan yourself or check with the two-wheeler company if they have an exclusive connection with banks or NBFCs. Often, lenders have ties to the two-wheeler companies that waive processing fees, process the loan quickly, and charge a lower interest rate. You must check the loan offered by the lender with an exclusive link to the two-wheeler company and then compare it with the loan offers of the different financial institutions to make the right decision.
Special offers on two-wheeled loans
Most banks offer special loan deals for two-wheelers from time to time. For example, you can get a good deal during specific days or times like festivals, New Years, Independence Day, etc. You can get a two-wheeler loan at an attractive interest rate, and you can also have the option of grabbing the loan at zero processing fees with other offers.
Check pre-approved two-wheeler loan offers
If you have a good history of transactions in your bank account and you have a healthy financial relationship, your bank may offer you a pre-approved loan for two wheels. Usually in such loans you get advance information about loan amount, interest rate and fees. “Pre-approved loans are processed quickly. Banks inform their customers of pre-approved loans through emails, texts and phone calls, or you can verify the same by logging into your online bank or an aggregation platform like ours,” adds Shetty.
Sometimes borrowers face problems such as low credit scores or cannot meet the bank’s eligibility criteria. In such cases, they can approach an NBFC for a two-wheeler loan. Some NBFCs are flexible on eligibility standards when issuing the two-wheeler loans, but they may charge you a higher interest rate and processing fee. It is advisable to take out a loan with two wheels according to your real needs and when you are sure to repay the loan early without defaulting on it. Never miss the timely repayment of your loan EMIs to continue your financial journey hassle-free.