Two wheeler loans have been a smart introduction to the already available pool of personal financing, simplifying bike purchase for all segments of the society, benefiting the economically held-back class the most. Bike loans are available in primary two types, namely traditional bike loans and zero down payment bike loans. These financing options have also left the borrower with a better choice to make when funding bike purchase. Other favourable features like flexible repayment options and low two wheeler loan interest rate also make these advances viable in the long run.
A borrower can still attempt to cut the total cost of the loan by undertaking ways that can help reduce the interest rate levy on these advances. Let’s check out some of the most popular ways that can help reduce the bike loan rates.
Make a Thorough Lender Comparison of the Financial Market
The first and foremost step you can take to secure a low two wheeler loan interest rate would be to go for a through comparison of available lenders in the financial market. Today, you will find most conventional financial institutions and NBFCs extending funding as bike loans to make vehicle financing conveniently accessible to all.
However, not all lending institutions lay down the same terms on these loans, the interest rates levied being the prominent differentiator. Given that even a slight part percentage change in these rates can mean significant repayment liability differences, the borrower must assess and compare the lenders to find out the lowest applicable rate to finance bike purchase at.
When at it, also make sure to compare other features applicable to these loans so that you end up settling for an advance that comes with the best terms, features, and facilities as per your requirements.
Choose a Loan Amount Within Your Maximum Eligibility
Every individual carries a certain eligibility for availing bike loan based on various factors related to his/her borrowing profile. This enables a prospective borrower to avail a bike loan up to a set limit only. It is crucial to check how much you can borrow at most as bike loan based on your profile. And when availing financing, one must choose a loan amount within this limit.
Doing so leaves one with an enhanced repayment capacity, enabling easy accommodation of the repayment liability in their income. As this reduces the overall risk that the lender undertakes in financing the loan value, they can easily agree to approve the loan at a lower two wheeler loan interest rate than the standard market levies. Use a bike loan EMI calculator to assess your maximum eligibility for the advance and apply accordingly.
Increase Your Down Payment Amount
When availing a traditional bike loan, you need to pay a certain percentage of the vehicle’s price as down payment for the remaining amount to finance. This payment can go up to 20% as required by the lender. However, for the purpose of securing a low two wheeler loan interest rate, it is advisable to go for a higher down payment than the stipulated requirement. For instance, you can choose to increase your Splendor Plus down payment from a stipulated 16% from your lender to a 20% or more for interest rate reduction.
Doing so reduces your overall repayment capacity, leaving your income open to easy EMI adjustment. As such, it reduces the risk associated with your borrowing profile, thus enabling a lending institution to financing the loan at a low rate. Keeping these aspects in mind and making the necessary changes in your borrowing profile can help secure the lowest two wheeler loan interest rate. You can always check your overall loan affordability by assessing your repayments with the help of a bike loan EMI calculator. These financial tools are available for free on Hero FinCorp websites and can be used to make suitable borrowing decision.