Two-wheelers, like bikes and scooters, are India's most popular means of local transportation. They are easy to ride, consume less fuelou to make at least 5% of the bike’s cost as down payment. Let’s explore the down payment aspect of a bike loan below.
Minimum Dow, and require less space to leave traffic congestions behind. Moreover, they are particularly popular among youngsters as many manufacturers now produce bikes with sporty and stylish looks. However, many high-performing bikes are expensive, and not everyone can afford them from their savings. That is where Hero FinCorp’s lowest down payment bike loan can provide the required funding.
You can finance a major percentage of the two-wheeler’s cost with a loan for a bike or scooter while keeping your savings intact. Lenders expect yn Payment Required for a Bike Loan
A bike loan lender pays the bike's cost to the dealer, and you can repay the loan amount to the lender in easy EMIs. However, top finance companies like Hero FinCorp do not fund 100% of the bike's cost with a loan. At most, they can finance up to 95% of its cost. You must pay the remaining 5% as a down payment. This is the minimum down payment for a bike that helps you bring a bike home without paying its cost upfront.
Read Also: Zero Down Payment on Bike Loan: Eligibility & Process
Factors Affecting Down Payment
The minimum down payment for a bike loan varies in each case depending on several factors, including the following:
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Loan Amount: Typically, the higher the loan amount, the bigger can be the down payment. As the loan amount increases, so does the amount of the down payment, which is a percentage of the bike's cost.
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Credit Score: A high credit score demonstrates creditworthiness, making lenders feel safe lending you a bigger loan amount. Consequently, you must make the minimum down payment for a scooter or bike.
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Bike Cost and Model: More expensive two-wheelers may require a bigger down payment.
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Repayment Tenure: Since longer loan terms have a higher risk of default, the lender may ask for a higher down payment from such borrowers.
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Lender’s Policy: The minimum down payment for a bike loan depends on the lender’s policy and risk assessment. For instance, Hero FinCorp finances up to 95% of the bike’s cost. Other loan companies may not offer such a high LTV ratio.
Read Also: What is a Down Payment? Here Are Some Points You Need to Know?
Processing Fee for Bike Loan
The processing fee for a bike loan is a one-time fee that lenders charge to process and approve your loan application. It varies between lenders depending on their internal policy. It can be a fixed charge or a percentage of the loan amount. In most cases, it is a non-refundable amount you must pay from your pocket in addition to the down payment. Therefore, before applying for a loan for a bike, you must consider the processing fee as well to calculate the loan cost and ensure affordability.
Ways to Avail of Low Down Payment Benefits
Making the minimum down payment for bike purchases comes with several benefits, such as savings kept intact, no need to pay the bike's cost upfront, no financial burden, etc. Here are a few ways to avail of the lowest down payment bike benefits:
Maintain a Healthy Credit Score
Your credit score is one of the most crucial parameters to determine your down payment. A high credit score demonstrates creditworthiness, encouraging the lender to approve a bike loan with a minimum down payment. Therefore, maintain a decent credit score to get a two-wheeler loan with the maximum LTV ratio.
Approach Your Current Lender
If you already have taken a loan and repay your EMIs on time, approach your current lender to request a bike loan. A happy loan provider will approve your loan application without hassle and ask for the minimum down payment from you.
Pick an Affordable Bike
Even with a bike loan, choose a bike model you can easily afford. Although you can stretch your finances with a loan since you don't need to pay its cost upfront, buying an expensive bike will also increase the down payment requirement. So, pick an affordable bike to avail of the low down payment benefits.
List of Required Documents for Bike Loan
The documentation requirements vary for salaried and self-employed individuals. These are as follows:
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Duly filled loan application form
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Passport-size coloured photograph
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Identity proof, like driving licence, Aadhaar card, passport, PAN Card
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Residence proof, like driving licence, Aadhaar card, passport, ration card, utility bill, or Property or Municipal Tax Receipt
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Income proof, like salary slips, bank account statements, salary certificates or Form 16 for salaried employees and bank statements and recent ITR for self-employed professionals
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Salaried employees must provide job continuity proof, and self-employed professionals must provide business existence proof like a Copy of Tax Registration, Shop Establishment Proof, or Company Registration Certificate.
How to Avail Two-wheeler Loan at a Low-Interest Rate to Finance Bike?
Maintain a decent credit score, opt for a reasonable LTV ratio, reduce your financial obligations, and choose an affordable bike to get a low-interest-rate two-wheeler loan from Hero FinCorp. Opt for a shorter loan tenure to reduce your interest outgo while a longer term keeps the EMIs manageable.
Frequently Asked Questions
1. Can I buy a bike with 0% EMI?
No, each EMI will constitute both the principal and interest amount.
2. How do you buy a bike on EMI without a down payment?
You cannot buy a bike on EMI without a down payment. At most, you can qualify for a bike loan with up to 95% LTV ratio. You must pay at least 5% of the bike's cost as a down payment.
3. Which is a better bike loan on EMI?
Hero FinCorp bike loan with the lowest interest rate is the best loan plan for two-wheeler finance.
4. What is a zero down payment?
Zero down payment is a scheme where the lender finances 100% of the bike's cost, and you don't need to pay any down payment.
5. What are the maximum years for a bike loan?
At Hero FinCorp, you can repay your loan for a bike in a maximum of 48 months of repayment tenure.
