It is no surprise that a two-wheeler bike costs a considerable amount of money. Not everyone is capable of buying, and neither should if they do not have a hefty bank balance. Yet, there are a lot of people who are afraid of availing a loan to purchase a two-wheeler bike.
There are two main reasons for this fear to inculcate in their minds- the feeling of the burden that something has been borrowed and the Two Wheeler Loan has to be paid back on time and the fact that the amount to be paid back over the years is going to be higher than the one borrowed. However, they do not realise that there are several advantages which come along with boring alone for two-wheelers over its negative side. 6 of them are listed below:
Reduces pressure on your bank balance
A prudent financial advisor will always tell you that it is better to pay smaller amounts in instalments as payment for two-wheeler bikes then taking a used chunk of money out of your bank account. Dreaming of a substantial amount can put a lot of financial pressure on you and may disrupt the business plan and investment that you could have made to earn more money.
Along with that, the income of the borrower will quickly help them to finance the monthly instalment as well as the down payment.
Improves the borrower’s CIBIL score
Approval of two-wheeler loans requires a backup from an excellent CIBIL score. The CIBIL score shows a rating of your credit maintenance and repayment over the years. It shows how creditworthy you are and if the lender will be able to realise the entire amount that is borrowed to him depending upon his records.
The reason why a two-wheeler loan is capable of improving the borrowers CIBIL score is that a two-wheeler does not cost too much, so the repayment is not that big of a problem even for young people.
Low criteria for loan eligibility
We have established till now that in comparison to the other loans, a two-wheeler loan is somewhat easier to get approved. This is because of the mid-range cost of a bike. This feature can encourage him to buy a bike on EMI.
Since the value of the bike is not too much, the monthly installment to be paid as loan repayment, it is also not very high. This is why people with even low-income range can apply for this loan and get approved.
Supportive rates of interest
The average rate of interest that is charged by a bank or otherwise for a two-wheeler loan to buy a bike on EMI is 12-27. Because of the preference of the people towards bikes over public transport, its demand has increased by manifolds. As a result of this, the interest rates have been lowered to reel in more number of borrowers.
Easy and quick process
An earlier loan used to be a very cumbersome process with people had to fill in many forms and stand in for hours. Long gone are those days as bike loan is approved nowadays within 24 hours. Also, the repayment period earlier used to be entirely limited between 12 and 48 months.
This period has also been successfully extended up to 60 months for more manageable repayment and lower instalment to put less financial pressure the borrower. You can easily calculate bike loan EMI with bike loan EMI calculator.
Benefits and insurance
A new law regarding bike loans has made things easier for bike loan borrowers as they can get additional benefits from the lenders. Some of the loans come with attractive benefits like payment of a part of the insurance or a small number of installments to be paid depending upon the financial situation of the borrower.