About Two Wheeler Loan Interest Rates
Two Wheeler will be valuable as it removes it your additional charges which go in transports and another vehicle. You don’t need to take a weight while financing it as there is no enormous add up to pay for it. Before feeling free to pick the method of money for your bike, it’s critical to know the highlights of the loan and interest rate winning in the market
Check and Compare the Two Wheeler Interest Rates across different banks. Avail the Best one and drive your dream bike home.
Two Wheeler Loan Interest Rates – Updated 2020
|Bank||Two Wheeler Loan Interest Rates*||Processing Fee|
|SBI||12.65%||1.25% of Loan Amount with Min Rs. 250 and Max Rs. 500|
|HDFC Bank||14.03%||Maximum – 3% of Loan Amount|
|PNB||10.70%||Rs.500 to Rs.1,000|
|Bajaj Auto Finance||11.60%||1% – 3.5%*|
|Indusind Bank||12.00%||Up to 5% of Loan Amount|
|Allahabad Bank||11.80%||Minimum Rs. 614|
|Andhra Bank||10.35%||Rs.500 to Rs.5,000|
|Bank Of India||7.75%||1% of loan amount; Rs.500 minimum and Rs.10,000 maximum|
|Union Bank of India||11.55%||NIL|
|United Bank Of India||11.00%||1 % of the loan amount|
|Corporation Bank||12.35%||Rs.500 onwards|
|Karnataka Bank||13.85%||0.25% of Loan Amount with Minimum Rs. 250 and Maximum Rs. 1000|
|Jammu and Kashmir Bank||9.65%||0.50%|
|Canara Bank||13.55%||Rs.1,000/- and maximum of Rs.5,000|
Tips for availing best Two Wheeler loan interest rates
Expenses and Charges: Various loaning organizations charge charges including settlement expenses, evaluation expenses, specialist expenses, and advance handling charges. Look at the expenses of various banks before benefiting the two-wheeler advance. Select the advance that gives the most reduced two-wheelers Loan Interest Rates.
FICO assessment and Financially Stability: Various loaning organizations allot the loan cost based on the FICO rating of the purchasers. Customers who have a high FICO assessment score will get low two-wheeler financing costs. Find and think about loan costs through online instruments of examination, which grant borrowers to look at paces of changed money related foundations.
How to calculate two-wheeler loan EMI?
Your EMI will show you how much money you must pay back to the bank each month. Your EMI is primarily determined by the loan principal amount, the interest rate, and the loan term you choose.
p>Your transaction fee and prepayment trends will also factor into your EMI calculation.
It’s always a good idea to figure out your EMI before applying for a motorcycle or scooter loan. Comparing loan EMIs will assist you in determining the most cost-effective and appropriate loan.
The two-wheeler loan calculator is a one-of-a-kind repayment calculator that allows you to calculate your EMI in seconds. It’s easy to use. Simply enter your loan parameters to get an instant EMI and amortisation schedule.
The variable interest rate or fixed interest rate – which is better?
When applying for a bike loan, your lender can give you the option of choosing between a variable and a fixed interest rate. Which one should you pick in such a situation?
The level of risk associated with both determines whether to use a fixed rate or a variable rate.
Variable interest rates are typically higher than fixed interest rates. Set prices, on the other hand, remain stable even as market rates fluctuate. For example, if you choose a fixed rate of 12% p.a., it will remain constant regardless of what happens.
Variable interest rates, on the other hand, fluctuate with market conditions. When the RBI changes the repo rate, the rates linked to MCLR (Marginal Cost of Funds based Lending Rate) change as well.
As a result, your rate will rise or fall over time. Variable interest rates, on the other hand, are typically lower than fixed interest rates. As a result, most borrowers prefer variable rates.
Tips to Lower Two Wheeler Loan Interest Rate
Clean up your credit: Because your credit score is so important in deciding the interest rate you’re offered, you can start by cleaning up your credit history. If you don’t have good credit, work on improving it before applying.
Test your debt-to-income ratio to see if you can improve your current debt situation. This chart demonstrates how much of your current income goes toward loan and credit card repayment. Reduce the debt-to-income ratio by paying off current loans. The lower the ratio, the more likely you are to get decent prices.
Negotiate with your lender: You can be able to get better rates by negotiating with your lender. This is particularly useful if you don’t meet all of the eligibility requirements. If you don’t have enough money but are expecting a boost, for example, showing evidence of this will help you get better interest rates.
Take out a loan from your current lender: If you already have a savings account with a bank, you might use it to get a bike loan. You will get better interest rates if you already have a strong partnership with them.
Why you should Compare Interest Rates before Applying for a Two-wheeler Loan?
The primary reason for comparing the interest rates of the various loan options available to you is to determine how much each one would cost you. This will assist you in calculating how much you will have to repay each of these options each month.
This should assist you in locating the most affordable loan. You will find a loan that better fits your current needs by comparing other factors such as the processing fee and the repayment term.
Things to Consider other than the Interest Rate
A processing fee is a one-time payment levied by your lender for the processing of your loan application. This could have an impact on your monthly payments. As a result, even though you get a low-interest loan, your processing fee would boost your rates. Choose a lender who will give you a low-interest rate and a low processing fee.
- Eligibility requirements – Before your loan is processed, each lender may have a set of eligibility criteria that you must meet. Some lenders may have stricter requirements than others. The least stringent requirements can apply to NBFCs. Select a lender whose requirements you can easily meet. This should make it easier for you to get your loan without any problems.
- Prepayment penalties – Paying off your loan early will save you money on interest. However, several lenders charge a fee if you try to pay off your loan early or have it foreclosed. If you want to prepay or foreclose your loan in the future, compare these fees. This will assist you in determining whether or not foreclosing on a loan is advantageous.
- Other fees – Make sure you read the loan offer document carefully to learn about any additional fees. This will save you money in the future by preventing unexpected charges. It may also assist you in determining the true cost of your loan.
- Disbursal time – This is how long it takes the lender to send you the money after you apply for it. Find out how long it takes for different lenders to approve and disburse your loan. This is particularly useful if you’re in a rush to get a loan to buy your bike.
- Customer Service – When applying for a loan, many borrowers overlook the importance of customer service. In order to answer your questions in the future, a lender must have a strong customer service department. It can be particularly aggravating to have poor customer service.
- Discounts and special offers- Keep an eye out for lenders who give occasional discounts or special rates and loan terms. During festival seasons, many lenders offer special deals to their customers. By taking advantage of these, you might be able to get better interest rates, repayment plans, and other loan terms.
Factors Affecting Two Wheeler Loan Interest Rates:
There are sure factors that either increment or diminishing the two-wheeler credit loan fee in India altogether. These variables are as per the following:
Vehicle Type: The loan cost will rely upon the kind of vehicle you plan to buy. Regardless of whether it is a sulked, a motorbike, or a very good quality bike, the financing costs for every one of these classifications will fluctuate freely.
Pay range: The sum you win really influences the sum you will be at risk to pay as an interest rate. Your salary is one of the boundaries to decide your believability for reimbursements and along these lines influences the interest rate you will be charged.
Credit score: Your credit score greatly impacts interest rates on two-wheeler loans. A credit score is what describes your repayment history. A higher CIBIL score will enable you to avail of an easy two-wheeler loan but a lower CIBIL score would attract a higher interest rate.
Credit Tenure: The loan residency influences the loan fees, a more extended residency brings a lower financing cost.
Business Type: Self-employed candidates typically draw in a higher rate of interest because of the unsteadiness of the market, while the salaried candidates can benefit from two-wheeler credits at lower rates.
An Effective interest rate (EIR) consists of two components:
- The base rate, which remains fixed.
- The mark – up rate, which is a small percentage of interest added to the base rate. It varies according to the property.
Types of Interest Rates
- Fixed interest rates
- Floating interest rates
- Fixed-Rate Two-wheeler Loan: The loan EMIs remain constant for the Fixed-rate two-wheeler loans, which means that the rate applicable to the applicant at the time of loan disbursal will remain unchanged throughout the loan tenure, even if the interest rate decreases or increases with time.
- Floating-Rate Two-wheeler Loan: The EMI amount for these two-wheeler loans alter with changes in the interest rates with time. It comprises of Index and Spread in which Index is the benchmark rate that alters with RBI’s policy changes and Spread remains constant as it is the additional charge that a bank adds to cover up the risk factor.
Some Basic Tips for A Two Wheeler Loan
- Look at! It is consistently prudent to look at the banks and pick the one which can be trusted just as which can offer you the best arrangement. This additionally spares you from extortion. Typically, it is ideal to get from the bank where you as of now have a record.
- Peruse! It is important to peruse the reports and arrangements cautiously so you can know expressly and obviously the conditions of the loan. This is something you can’t settle on as it will spare you from future stuns.
- Know your privileges! It is consistently helpful to think about your privileges and advantages that you can use for your advantage while profiting from a two-wheeler loan.
How to Get the Lowest Rate of Interest on Two Wheeler Loans
Certain tips and tricks can spare you from paying hefty sums on your home credits. If you follow these practices you can profit the rates of interest in the market.
Pay off a substantial Loan Downpayment
The advance sum is one of the primary factors that influence your two-wheeler advance loan cost. The higher advance sum as a rule pulls in a higher loan cost and the other way around. To get a two-wheeler advance at the most minimal conceivable interest rate, it is fitting to take a stab at taking care of your loan sum by offering more towards your home initial installment.
Keep up Excellent CIBIL Score
CIBIL score otherwise called FICO rating is a pointer of your financial soundness. A high FICO assessment reflects mindful credit conduct and the other way around. It is additionally critical to take note of that candidates with a lower FICO assessment will pay higher enthusiasm on their two-wheeler loan. A higher FICO assessment directs the productivity with which you have taken care of your past credits. Having a decent FICO assessment will permit you to appreciate certain advantages like benefiting the least financing costs in the market.
- Improve your present obligation status:
as such, check your obligation to pay proportion. This gives you the amount of your present pay is going toward reimbursing advances and credit card bills. Pay off existing credits and cut down this proportion. The lower the proportion, the better your odds are of getting acceptable rates.
FAQs for Two-Wheeler Loan
✅May I always take out the loan with the lowest EMI?
Although taking out a loan with the lowest interest rate may appear to be the best option, it may not always be the most cost-effective option for you. Other fees, such as processing fees, paperwork fees, vehicle inspection fees, and other fees, all affect the loan rate. Before you choose a loan, make sure you review all of these as well.
✅What are the various ways to compare interest rates?
There are two methods for comparing two-wheeler loan interest rates. Each lender will provide you with a quote by visiting their branch offices or visiting their websites.
✅Will my interest rate be changed by my lender during the term?
Only if you prefer a variable rate will your interest rate adjust. Your lender will adjust your interest rate to fit the market rate if the market rate changes. The rate you chose will not adjust if you choose a fixed rate.
✅What is the frequency of rate changes if I select a variable rate?
Only when the Reserve Bank of India (RBI) adjusts the repo rate will your variable interest rate adjustments. The change would be proportional to the change in the RBI. If the RBI raises the rate, your lender will raise the rate as well. If the RBI lowers its rate, your lender will lower yours as well.
✅Can my variable rate go higher than my fixed rate?
The RBI generally aims to keep its rates low in order to protect borrowers from high-interest rates. As a result, there’s a slim risk that variable rates will rise above fixed rates.
Table of Contents
- 1 About Two Wheeler Loan Interest Rates
- 2 Two Wheeler Loan Interest Rates – Updated 2020
- 3 Tips for availing best Two Wheeler loan interest rates
- 4 How to calculate two-wheeler loan EMI?
- 5 The variable interest rate or fixed interest rate – which is better?
- 6 Tips to Lower Two Wheeler Loan Interest Rate
- 7 Why you should Compare Interest Rates before Applying for a Two-wheeler Loan?
- 8 Things to Consider other than the Interest Rate
- 9 Factors Affecting Two Wheeler Loan Interest Rates:
- 10 Types of Interest Rates
- 11 Some Basic Tips for A Two Wheeler Loan
- 12 How to Get the Lowest Rate of Interest on Two Wheeler Loans
- 13 FAQs for Two-Wheeler Loan
- 13.1 ✅May I always take out the loan with the lowest EMI?
- 13.2 ✅What are the various ways to compare interest rates?
- 13.3 ✅Will my interest rate be changed by my lender during the term?
- 13.4 ✅What is the frequency of rate changes if I select a variable rate?
- 13.5 ✅Can my variable rate go higher than my fixed rate?