Riding a scooter or motorcycle can make getting around easier and faster for people who travel every day. But buying one can cost a lot of money, which some people might not have upfront. That's where Two-wheeler loans come in handy. With these loans, you can pay back the money in small amounts each month, making it more manageable for your budget. You can even apply for these loans online, right from your home or office. Generally, the interest rates for these loans start from 9.05% onwards.
Lower Income Criteria: Even if you don't earn much each month, you can still qualify for a two-wheeler loan because of the longer repayment time and lower interest rates.
Flexible Repayment: You can choose how long you want to take to repay the loan, anywhere from 1 to 5 years, making it easier to manage based on your income.
Lower Interest rate: Two-wheeler loans are a type of secured loan. This means that the bank or finance company has the right to take your bike if you don't pay back the loan. Because they have this security, they often offer lower interest rates compared to personal loans.
Minimum Down-payment: You have the option to make a smaller down payment, sometimes as low as just 5% of the bike's value. Then, you can borrow the rest of the money you need through the loan.
Build Credit History: Most of the time, banks don't require a good credit score to give you a two-wheeler loan. This means even if you don't have any credit history, you can still get the loan. And as you keep making your loan payments on time, you'll start building a good credit score for any future loans you might need.
Insurance Cover: Many two-wheeler loans include insurance coverage for the loan amount. So, if something bad happens to you, like an accident or illness, your family won't have to worry about repaying the loan because the insurance will cover it.
You can borrow money to buy a two-wheeler from different banks and NBFCs (Non-Banking Finance Companies). The interest rate you get depends on your financial situation and the policies of the bank. Here's a quick look at the interest rates for two-wheeler loans in India:
| Banks and NBFCs | Interest Rate (p.a.) |
|---|---|
| State Bank of India | 9.25% onwards |
| HDFC Bank | 9.05% onwards |
| ICICI Bank | 11.57% onwards |
| Bajaj Finserv | 10.99% onwards |
| Axis Bank | 15% onwards |
| Punjab National Bank | 11.65% onwards |
| Hero Fincorp | Depends on the applicant’s profile |
Please note that the interest rates, fees, and charges mentioned above are subject to change and are determined solely by the bank and RBI. Additionally, GST and service tax will be charged separately on the mentioned fees.
| Loan Product | Charges |
|---|---|
| Processing Fees | 1% to 3% of the loan amount. (Subject to the maximum amount as per lender’s policy) |
| Stamp Duty | At actual |
| NOC Charges | NIL for the first time, Rs.500 for duplicate NOC |
| Check Bounce or EMI return charges | Rs.500 |
| Foreclosure Charges | Varies from 3% to 6% of the loan outstanding. (Depends on the number of EMIs paid) |
| Overdue charges | 2.5% per month(May vary from bank to bank) |
While each bank and financial institution may have its own specific criteria for approving two-wheeler loans, here's a general list of eligibility criteria:
| Minimum Age | 18 Years |
| Maximum Age | 65 Years |
| Minimum Loan Amount | Rs. 10,000 |
| Maximum Loan Amount | Rs. 25 Lakh, subject to the price of two-wheeler and other eligibility criteria |
| Maximum Repayment Tenure | 5 Years |
| Net monthly income | Rs. 6000 or more |
| Disbursement time | 6 hours to 2 days |
| Applicant’s Profile | Employed or self-employed |
| Residential Status | Should be resident of the city for more than 1 year |
| Mandatory Document | PAN Card |
| Identification Documents | Passport, Voter ID, Aadhar card, Driving License (Only one document) |
| Income Proof |
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| Address Proof |
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Yes, it's possible to get your bike financed even as a student if you meet the specific eligibility criteria set by the lenders.
The best loan for financing your bike or scooter is the one with the lowest interest rate. This way, you'll have to pay less in monthly installments (EMIs) throughout your loan term.
To get financing for your motorcycle, bike, or scooter, you can easily apply for the loan online from home. Or, if you prefer, you can go directly to a bike shop and apply for the loan there by giving them the documents they need.
You can check your loan status online through internet banking. Another option is to visit the closest branch of the bank or financial institution that's providing the loan.
Many lenders consider a credit score of 620 and above to be good when giving out loans for motorcycles, superbikes, or scooters. However, if your credit score is lower than 620, you can still find lenders who may be willing to give you a loan, although they might charge a higher interest rate.
Banks allow you to make prepayments after successfully paying 3-6 EMIs. Depending on the number of EMIs you've already paid, there might be a small fee applicable on the outstanding amount when you choose to prepay.
Your eligibility for a loan depends on your income level. If your income is enough to cover the EMIs for two loans, banks may approve you for a second loan, even if you haven't fully paid off the first one yet.
When buying a two-wheeler, you're asked to pay a down payment, usually ranging from 15% to 30% of the total vehicle price. However, some lenders, like HDFC, offer zero down payment two-wheeler loans (subject to certain eligibility criteria) where you only need to pay the processing fees.