Two wheelers have become a necessity these days. Seeing the traffic on roads and lot of families going nuclear, it is better to own a two-wheeler instead of a car. Some purchase it because they have a fancy for bikes and others just because it’s a necessity.

A two-wheeler loan is important for the convenience of people so that they can travel easily and own a bike even though they do not have funds at the moment. Some of the luckier people who do have the finances to buy it without loan also might consider two-wheeler loans because they are easy to have approved and have monthly Instalments that are overwhelming. For the rest of the majority of the prospective two-wheeler, users loans are perhaps the perfect idea. There are two kinds of loans offered by the banks -Standard Bike loans and Super Bike loans. These are the loans which made to suit the requirements of the customer. Super bike loans cover bikes from Benelli to Harley Davidson, Kawasaki to Royal Enfield and etc. And standard bike loan covers all the other two-wheelers which are not included in super bikes. Loans are also available for Used Two wheelers.

Features & Benefits of Two Wheeler Loan

There are numerous benefits of taking a two wheeler loan. Following are the major features of a two-wheeler loan that tells us that why a two-wheeler loan is beneficial:

• Loan margin: Most banks offer loans at a margin of a minimum of 80% and a maximum of 100%. Margin means the percentage of the on-road value of the vehicle that will be financed by the bank and the remaining amount would be the down payment that is to be paid by the person who takes the loan.
• Loan amount:

1. For salaried persons, the maximum loan amount is restricted to 6 times Net Monthly Income (NMI), i.e. net of all deductions including actual monthly tax deductions at source.
2. In case of others, the maximum loan amount is restricted to half of Net Annual Income (NAI), i.e. income as per latest income tax return filed less taxes payable.
3. For agriculturists, the net annual income should be arrived based on the nature of their activity (i.e. farming, dairy poultry, orchards, etc) land holding, cropping pattern, yield, etc., and an average level of income derived therefrom in the area.

• Loan Tenure: Two-wheeler loans can be taken for a tenure ranging from 12 months to 60 months. A longer tenure makes it easier to be repaid conveniently. For used two wheeler insurance the maximum tenure is 3 years.
• Loan partnership with dealers: Two-wheeler dealers also have a partnership with the banks offering two wheeler loans wbikehich helps the customers to take convenient loans. These loans prove to be cheaper as you can negotiate with the dealer and ask for additional benefits.
• Easy repayment methods: Nowadays it is much easier to pay the EMIs of the loans. One can pay through ECS/Standing Instructions/post-dated cheques. ECS is Electronic Clearing System. It is a mode by which funds are automatically debited to your account to pay a certain bill or fee. It helps because you don’t have to remember the dates of payment of EMIs. It is done only if a standing instruction is giving by the customer.
• Annual Income Leverage: Banks offer loans to people who have an annual income of as low as Rs.72000 for self-employed people and Rs.84000 for salaried profile people. Also, there are some banks who offer loans to people without even considering their income.
• Interest Rate: The interest rates generally vary between a minimum of 10.13% to a maximum of 23.26% for standard bike loan and for super bike loan the interest rate ranges from 8.87%-12.04%. Some banks offer a 0.5% discount to women customers.
• Credit Score: if you are opting to take a loan for the first time then two-wheeler loans are a great idea of making a good credit score. This would definitely be helpful to you in future.
• Quick and easy processing: Taking a two-wheeler loans is quick and easy. One can easily get an approval to get a two wheeler loan.
• Other costs covered: Loans sometimes cover the cost of accessories, insurance and registration. This helps you to get finance not only for your vehicle but also for other accessories.

Eligibility Criteria

The following people are eligible to apply for a STANDARD BIKE LOAN:

• A salaried or self-employed individual
• Individuals who are a minimum of 21 years of age at the time of applying for the loan, and no older than 65 at the end of the loan tenure
• Those who earn a minimum gross income of Rs. 84,000 per year for a salaried profile, and Rs. 72,000/- per year for a self-employed profile.
• Individuals who have been residing at the given residence for a minimum of 1 year (in case of transfer from another location with less than 1 year at the current location, kindly provide relevant documents to the bank during loan approval stage)
• Those who have been working for a minimum of 1 year
• Individuals who have a telephone/office landline connection.

The following people are eligible to apply for a SUPER BIKE LOAN:

• A salaried or self-employed individual
• Individuals who are a minimum of 21 years of age at the time of applying for the loan, and no older than 65 at the end of the loan tenure
• Those who earn a minimum gross income of Rs. 15,00,000 per year for a salaried profile, and Rs. 5,00,000/- per year for a self-employed profile.
• The residence should be self-owned (parental house is allowed)
• Those who have been working for a minimum of 2 year
• Individuals who have a telephone/office landline connection.

It’s hard to beat the convenience of a bike that origamis down to fit under your desk but can also make your commute faster and less taxing. Electric folding ebike are sprouting up on city streets, on trains and busses, and in office buildings and apartment hallways for a good reason.

Documents

Fees and Charges Applicable to Two Wheeler Loans:

People majorly give importance to interest rates, ignoring the fact that there are other fees and charges applicable on a loan. So it’s important to make a note of other fees and charges applicable on a loan, which are as follows:

• Processing Fee: Processing fees are charged for processing the request for the loan and is mandatory for most banks. They are also, generally calculated in percentages of the total loan amount. This fee is non-refundable in any given situation. The amount charged for it varies from bank to bank.
• Prepayment Fees: This is charged under the circumstance where people are able to pay the repayments earlier than due and sometimes even pay the remaining loan amount earlier. For two-wheeler loans, this charge is generally very low and sometimes even nil.
• Late-payment Fees: The borrower is generally charged with this when crossing the due date for loan repayment.
• Charges for Conversion: If you wish to change your two-wheeler loan from a floating rate calculation to a fixed rate or vice versa, this fee is charged. This is basically a charge for switching, based on your requirements.
• Copy of an Account Statement: Sometimes people may require a statement for their current statement for the loan. While most banks do not charge for getting you a copy of the same, there might be a few banks which may levy a nominal charge for a hard copy of the same.
• Administrative Fee: This charge takes care of the administrative cost to the bank for processing your loan, and this is not a part of the processing fees.

Margin

Super bike loans: 15% of “Ex-showroom Price” of the vehicle

Standard bike loans: 15% of the on the road price (which includes vehicle registration charges, insurance, one-time road tax).

For second-hand vehicles: Min. 30% (on depreciated value or value assessed by Valuer or sale consideration whichever is lower)

Security

• Hypothecation of the vehicle to be purchased out of Bank finance.
• Charge to be registered with RTO.