The number of two-wheeler loans are increasing substantially in the country every year, with the rise in the number of bike-owners. Bike loans are majorly availed by students who find it difficult to pay for other higher education expenses. You can also get a bike loan if you have a steady source of income and don’t want to waste time in travel or just want to give yourself a treat.
Just like the other loan options, bike loans also come with commitment and interest repayment plans. Some of the aspects to consider are the monthly instalment plan, tenure of loan period, age of applicant, reliability of the applicant, etc. It might get difficult working out a budget when you have to make payments on two loans at the same time but with some tips that we have mentioned below, you can make your life simpler while paying your bike loan.
Two-wheeler hypothecation
The intention of the new facility, called ‘Two wheeler hypothecation’, is to enable a borrower to access credit on easy monthly instalments rather than large lump sums, thereby making motorcycles more affordable, with a view to encouraging commuters and expanding two-wheeler usage in Asia’s third largest economy.
- Flexible tenure
Bike loans are a flexible tenure. The loan tenure will vary between 6 and 60 months giving you the choice to pick the tenure according to your repayment capacity. You can also choose between a fixed and floating type of interest rate. Since lenders offer up to 90% of the bike’s market value as a loan, the applicant just needs to make a down payment of merely 10%.
Our Flexible Loan scheme has helped lakhs of customers across the country get into the action with their two-wheelers. Avail of loan options between 6 to 60 months and choose your tenure based on your ability to repay. Our loans can also be repaid anytime during the loan period, unlike another financier who offers monthly EMIs with collateral security. Apply Now at Muthoot Capital, and get a bike loan the same day.
- Use surplus money
A low interest rate usually indicates that the lender has granted you a less risky loan. However, as your credit history improves, you may receive better interest rates on future loans. But remember, never take out a loan for more than you can afford to repay and don’t use future income to pay off old debts.
- Negotiate repayment terms
By negotiating with the lender or seller, you can reduce your EMI payments and save thousands. For instance, if you negotiate a 40% reduction in the price of a bike loan, your EMI premium reduces by almost 25%. Learn negotiation strategies and be ready to discuss your budget, down payment, repayment terms, and requirements. The EMI calculator makes it easy to work out the monthly installments for your loan. Whether you’re buying real estate, a car or a two wheeler, use this simple calculator to help find the affordable option with flexible EMIs.’
- Auto payments
The lenders who offer auto payments will also save their employees a lot of time and paperwork. The greatest advantage is the guaranteed payment, since it is impossible to miss a payment or lose a paper bill when you sign up for auto payments. In addition, there are often discounts for signing up for automatic payments.
- Make prepayment
Saving money through prepayment of your two wheeler vehicle loan may sound like an impossibility. However, a number of lenders have now started to offer borrowers the freedom to make prepayments in order to bring down their EMIs. In such cases, make full use of getting one or two extra instalments every year. At times when you are thinking about completely settling the loan, it is prudent to compare the amount you would be saving through prepayment with the penalty charged for early settlement. This will give you an idea if prepayment is worth it or not.
Debt-free is just a matter of time and interest. We also need perseverance to make it so. Paying off in easy monthly installments will make the journey easier. Once you can manage the EMI, you accomplish your dream of a car of your own without paying a huge amount upfront.
The above ways provide you with good reasons for your two-wheeler loan. In some cases, the repayment can be stretched for the maximum tenure allowed by the bank. The amount saved in interest can be used as a down payment for your next purchase or towards fulfilling long-term plans. Get detailed Muthoot share price news and analysis, Dividend, Bonus Issue, Quarterly results.