Thanks to loans for two-wheelers, people can easily lay their hands on their dream bike. With a two-wheeler loan, you can get yourself a brand-new two-wheeler with the payback facility offered by banks and other lenders in easy monthly installments. Moreover, with affordable interest rates and low processing charges it’s pretty easy to get this loan.
Tips to Lower Two Wheeler Loan Interest Rate
When you are applying for a bike loan, your goal must be to avail one with the lowest possible rate. Here is a list of things that might help you lower your Bike Finance Interest Rates.
Maintain your credit score:
Your credit score plays a pivotal role in determining the interest rate offered to you. If possible clean your small pending dues for a good credit score. A lower credit score can even lead to the cancellation of the application. If your credit is not impressive look for the ways you can fix it before the loan application.
Check and improve your debt-to-income ratio:
Your present debt status or debt-to-income ratio is a reflection of how much of your present earnings are being spent on replaying your loans and bills of your credit card. This is a major criterion for determining the interest rate of your loans. If possible pay off the existing debts or credit card bills for an impressive current debt record. The lower your ratio of income to debt the better chance you get for getting the best rates.
A Negotiation with your lender can lower the interest rates:
As previously stated the interest rates of financing a two-wheeler can depend upon a lot of factors, a negotiation with your lender can actually help you. In certain cases, you don’t fully satisfy the eligibility criteria but they might still avail you the loan depending upon some other factors and future promises, and negotiation works best in those cases. For example, if your income is below the qualifying mark but you are expecting a promotion with a salary raise, presenting a document as its proof can help negotiate a good interest rate.
Apply for a loan from your existing lender:
If you have a good amount of savings in a certain bank you can apply for a bike loan from the same. They have a record of your savings history and withdrawal and this generates a sense of trust. In this case, avoid applying for a loan from a bank that doesn’t have any dealings with you at all. Additionally, if you have a good rapport with them you can easily convince them for offering you a better interest rate. Apart from these things which might lower your interest rate you need to consider a few other things. Always compare and contrast the loans of different institutions for getting the best rates. Charges like processing fees and Prepayment charges need to be checked and if you need to bear other charges and if there are any special discounts and offers for the same.