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If you\u2019re tired of increasing traffic, surging cab prices, or fed-up from waiting for the bus, don\u2019t get worked up! It\u2019s a sign telling you to think about getting your own motorcycle. A spanking new bike that\u2019ll let you swerve around the traffic and save a lot of time.<\/p>\n\n\n\n
So if you\u2019re thinking of purchasing a bike \u2013 either for convenience or for leisure \u2013 getting a bike loan is a good idea, especially if you\u2019re running short on cash. Bike finance helps you split up your bike\u2019s amount into small, manageable monthly installments, allowing you to own your dream machine without denting your savings.<\/p>\n\n\n\n
However, before you start checking your two-wheeler loan eligibility, it\u2019s essential that you know the types of loans available in the market, and which one fits your preferences the best.<\/p>\n\n\n\n
Essentially, two-wheeler loans come in two types \u2013 secured and unsecured loans.<\/p>\n\n\n\n
Simply put, a secured loan is protected by an asset. It can be anything, from your home to your car, or in this case, your bike. Usually, the item, which is purchased using a loan, is used as collateral or guarantee. Other items such as personal property, stocks, or fixed deposits can also be used as security.<\/p>\n\n\n\n
Most motorcycle loans are secured with your bike as the collateral. However, if you wish that your motorcycle is purchased under your name, and not the lender\u2019s, you can put up other assets as collateral as well.<\/p>\n\n\n\n
A secured two-wheeler loan means a lower interest rate. Since your lender has collateral against your loan, your loan is low-risk and the two-wheeler loan interest rate would reflect that. Such low-risk two-wheeler loans can also be relatively easier to obtain. The downside is that missed EMI payments could lead to the collateral being seized by the lender as compensation.<\/p>\n\n\n\n
Unsecured loans are the opposite of secured loans. This financing option includes credit cards, student loans, and personal loans. Forwarding an unsecured loan is a tad risky for the lender as there\u2019s a lack of security. Hence, unsecured loans for motorcycles are provided at a relatively higher bike loan interest rate.<\/p>\n\n\n\n
With an unsecured loan, there is no need for collateral and hence the interest rate will reflect this higher risk. But if your credit history is solid, you can avail of an unsecured loan easily.<\/p>\n\n\n\n
There are several factors to consider while choosing your loan type:<\/p>\n\n\n\n
If you wish to have a lower two-wheeler loan interest rate<\/a> and have an asset that you can pledge as collateral, a secured loan might be the right fit for you. A lower interest rate means lower EMIs and lesser financial strain. Also, since you\u2019re providing an asset as a security, the chances of loan approval are high and might get you a higher loan amount as well.<\/p>\n\n\n\n With an unsecured loan, your EMI amount will be considerably higher, so your repayment capacity should be factored in while deciding on the type of loan.<\/p>\n\n\n\n The best part of a secured loan is that you can get a loan without having to worry about your credit history. Having said that, your credit history isn\u2019t completely ignored. If you have a fairly low credit score, you might still get a loan, but at considerably higher interest rates. But if your credit scores are high, you can try to get a lower two-wheeler loan interest rate than average.<\/p>\n\n\n\n In the case of unsecured loans that are forwarded solely based on your credit history, it\u2019s essential to maintain a decent credit score (anywhere between 700 and 900). If not, your loan request may be denied outright because of the higher risk factor. So if your credit score is on the lower side, a secured loan would work more in your favour.<\/p>\n\n\n\n Unsecured loans are relatively less straining than secured loans, as you don\u2019t have to worry about your assets constantly. So if you\u2019re not comfortable with putting up your assets, and aren\u2019t bothered by a slightly higher 2-wheeler loan interest rate, an unsecured loan is the way to go.<\/p>\n\n\n\n Usually, when you avail of specific loans like a two-wheeler loan, which is generally secured, the lender may offer some extra benefits. For example, zero-down payment loans where they cover 100% of your vehicle\u2019s value or flexible EMI payment options that you can leverage to suit your needs. Some lenders may also offer corporate discounts on processing fees of such specific loans.<\/p>\n\n\n\n A bike loan can have a significant impact on your finances for the duration of its tenure. So analyse the financial implications of the different loan options available to you and choose the one that best fits your requirements.<\/p>\n\n\n\n Looking for a way to finance your dream bike? Well, Tata Capital is here to help you! Apply for our affordable two-wheeler loans<\/a> today, and get fast disbursals, competitive interest rates, and a customizable tenure. What\u2019s more, you can also use our bike loan EMI calculator<\/a> to plan your repayment schedule.<\/p>\n\n\n\n So what\u2019re you waiting for? Visit our website to check out our bike finance offerings today!<\/p>\n\n\n\n2. Credit score<\/strong><\/h3>\n\n\n\n
3. Attitude towards collateral<\/strong><\/h3>\n\n\n\n
4. Other benefits<\/strong><\/h3>\n\n\n\n
In the end<\/strong><\/h4>\n\n\n\n