Bikes are the best mode of transport through any terrain, be it the busiest roads to hill stations, it keeps you comfortable and thrilled. Buying a bike, especially without depending on family or friends for funds, is a moment of pride for every individual. That sense of accomplishment to that dream bring home your dream bike is unexplainable. Thanks to bike loans, you do not have to ask anyone for funds or go to unauthorized lenders to borrow money at exorbitant interest rates. These loans do not require you to pledge any collateral and are quickly repaid in affordable EMIs.
Interest rates are an essential factor that decides the affordability of the loan. Muthoot Fincorp offers the lowest interest rate for a bike loan as an established lender. However, many factors influence the interest rates offered to you. Let’s check them out:
Factors Affecting Bike Loan Interest Rate
- Net Income
- Employment Stablility
- Other Debts
- Credit Score
- Repayment History
- Relationship with your Financial Institution
Understanding the above factors will help you know if you can further bring down the interest rates. You can also reduce your interest rates with Muthoot with the following tips. Let’s take a look:
Tips to Get the Lowest Interest Rate for Bike Loan
Opt for a Shorter Tenure
The tenure of the loan determines your interest rates as well. The tenure is the duration of the loan in which you will pay back your loan amount along with interest decided upon. You can choose a term of your choice. However, interest rates are reduced when you opt for a shorter tenure since it reduces the risk for the lender.
Improve Your Debt-to-income Ratio
The debt-to-income ratio is significant as it is a crucial factor in determining your loan amount eligibility. If you have a particular bike in mind, you will need sufficient finances to fund it. Improving your bike loan eligibility will help you get adequate bike finance. Pay off your existing loans or credit card debts before applying for the bike loan. It will improve the calculation of how much of your current income can be spared to repay the bike loan. You will be offered a higher loan amount at reasonable rates. If your debt-to-income ratio is high, the interest rate will rise.
Make a Higher Downpayment
Making a higher downpayment for the bike loan will help you reduce the interest rates. It will decrease interest rates as the principal amount will also reduce. That said, it is advised not to exhaust your savings and run out of emergency funds. You can avail of this option if you have excess funds to comfortably make the downpayment. Otherwise, you can opt for a zero downpayment bike loan where the complete expenses for the bike are taken care of by Muthoot Fincorp.
Also Read– Quick Tips To Get Instant Approval For Two Wheeler Loan
The key takeaway is that the interest rates are offered after evaluating the risks in lending. Hence, eliminating the issues and improving on the above points will lower your interest rates proportionally.
How Muthoot Fincorp is the Best Entity for a Bike Loan
With Muthoot Fincorp, you do not have to go through this hassle. We offer the lowest interest rate for a bike loan starting from an unbelievable 0.99%* per annum. Apart from interest rates, we also provide you with 100% funding with our auto loans. This way, you will not have to pay any down payment to buy the bike. With close to 4200 branches all over the nation, you can easily find us near your home if you wish to apply for a loan offline. Serving more than 1000 customers daily, our customer-centric approach, the transparent loan process and best prices are our USP. Contact us for a hassle-free two-wheeler loan with the best schemes available. Let’s make the dream of riding your dream bike home a reality!