Two wheeler loans are available in ample numbers today, extended by both traditional financial institutions and NBFCs. This has made the loans easily accessible to all. Irrespective of which part of India you reside in, finding a lender offering two wheeler finance is as easy as it gets. The increasing number of lending institutions has also made the lending segment competitive, leading financial institutions to offer borrower-favoured terms on these loans, low interest rates and charges being one of the most crucial ones.
As a two wheeler loan is a secured funding option financed against bike hypothecation, aspiring bike owners also find it easy to avail these loans without undergoing extended profile assessments. Nevertheless, the involvement of credit subjects the lender to inherent risks that must be made up for so the lender agrees to finance the loan. Hence, we have brought some tips and tricks an aspiring bike owner can use to raise necessary financing conveniently.
Choose a Financial Institution You Have Existing Relationship With
Often when financing of any type is sought, your credibility as a borrower is the first question that lenders pose for your borrowing profile. It is all the same for two wheeler finance as well. Now, apart from credit score, the borrower’s relationship with the lender and previous record with them also matters crucially.
It is widely observed that applying for the loan with an existing lending institution you have previous relationship with can help leverage your accountability as a borrower. Naturally, the concerned lender would have all the essential details related to your individual and borrowing profile readily available for cross-checking. Also, if you had made timely payments of EMIs and in full towards complete loan repayment, your lender would be more than happy to process your next application.
And of course, the documentation requirements with an existing lender come down too, keeping loan processing hassle-free.
Make a Higher Down Payment Than Required to Bring Down LTV
The funding arrangement of traditional two wheeler finance is such that the borrower gets to finance only a percentage of the bike’s price as a loan. The remaining amount needs to be self-borne in the form of down payment.
For instance, your next bike purchase Hero Glamour costs Rs.80,000 approximately, and the lender is ready to provide only 80% of the cost, i.e., Rs.64,000 as bike loan, you would need to self-finance the remaining value as Hero Glamour down payment.
A higher down payment, even though bearing a higher weight on your finances, can have positive influence on your borrowing capacity. This is because it brings down the LTV of your loan, keeping the repayment liability low too, thus enhancing your borrowing capacity.
Meet All Eligibility and Document Requirements
Before sending in your loan application, you must make sure to check if you meet all the lender-specified eligibility and document requirements or not. The secured nature of these loans keeps the eligibility requirements low, and simultaneously, the documents needed are kept in check as well. Meeting all these criteria will work in favour of bringing your quick loan approval.
Choose Online Application to Proceed
To make the entire process quick, it is also advisable to go for online loan application. It involves filling up only a few loan details and is quick to approve as well as disburse.
Keeping these tips up your sleeve when borrowing can help bring easy processing and approval of your two wheeler finance. With all the requirements in place, purchasing a new bike or upgrading your old one to a newer, better should not be a trouble any more as the bike financing is readily available. Depending on the financial institution selected, loan applicants can receive approval of the advance within a few minutes of application only, with loan disbursal coming by within the next one or two working days as well.