Two Wheeler Loans With Low-Interest Rate Guide

two wheeler loan

Getting an online two-wheeler loan is the best way to fund your dream bike and yet be able to manage your finances without putting any burden on your savings or investments. Most lenders offer unsecured online two-wheeler loans, which means that you do not have to pledge your asset with considerable value as collateral. Depending on your repayment capacity, you can secure up to 100% of the bike’s on-road price as a loan.

The availability of attractive interest rates and flexible loan tenure enables you to repay your loan without constraining your monthly budget. However, your interest rate depends on factors, such as age, income, credit score, current financial obligation, etc. If you wish to secure a lower interest rate, it is advisable to apply for bike finance from Muthoot Capital as it offers the best deal in the market. 

Here are the top points to get an online two wheeler loan at a lower interest rate: 

Opt for a lower loan amount

Your interest rate depends on the loan amount you choose. As a rule of thumb, the higher your loan amount, the interest you will have to pay towards your loan. Although you get up to 100% of the bike’s market value as a loan, it would be wise to get a lower loan amount if you wish to secure a lower interest rate. If you choose a lower loan amount, your lender may consider you a low-risk borrower and offer you a lower interest rate. 

Choose a shorter loan tenure

Although your EMI amount will reduce significantly when you choose a longer loan tenure, you will have to pay higher interest in the long run. Lenders charge a higher interest rate on longer loan tenure to justify the risks involved. While applying for a 2 wheeler loan, you must consider the loan tenure and choose a repayment tenure that best serves your needs. 

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If you have the budget, make sure to choose a shorter loan tenure. Your EMI amount may increase, but you can significantly save in interest. Besides that, you can get rid of your debt sooner. 

Maintain a healthy credit score
credit score
credit score

Your online two-wheeler loan interest rate also depends on your credit rating. Your credit score is the first thing your lender checks before approving your application. It contains information about your credit history, length of credit history, credit utilization, credit mix, and new credit. It is a three-digit number that indicates whether or not you can repay your loan. 

You must ensure to maintain an excellent credit score to secure a lower interest rate. The minimum CIBIL score requirement is 750, and any score above this range will not only warrant your approval, but you can also get a favorable interest rate. 

Leverage your relationship with your lender

Your relationship with your current lender has a crucial impact on your interest rate. For instance, if you have taken out a loan or opened an account with your lender and ensure on-time repayments, then it means that you have a healthy relationship with your lender. You can leverage your relationship to negotiate better interest rates. 

In short

If you do not have enough funds to buy your dream bike, you can get an online two-wheeler loan to manage your finances without touching your savings. But, how well you can manage your finances depend on your interest rate, which is determined based on your income, credit score, age, etc. 

You can apply for the best two-wheeler finance through Muthoot Capital and get approval almost instantly.

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