How To Buy A Bike On EMI

Here’s how to buy a new bike on EMI.

Step 1: Budget estimation

When purchasing a new bike on EMI, the first and foremost step is to decide on the budget. The overall budget includes a down payment, bike, and loan costs. The tentative budget you arrive at will help you evaluate the kind of bike you can afford, the amount you can finance, and the monthly instalment amounts on the loan.

Step 2: Research your Options

Once you have determined your budget, research the bikes you want to buy and the loan options available. It is critical to choose the ideal bike that fits all criteria like the budget, preferences, and needs. Look up different loan options, including banks, financial institutions, and online lenders to compare interest rates, terms and conditions, and processing fees.

Step 3: Check your Eligibility

After selecting your ideal bike and arriving at a feasible loan option, check your eligibility. Your eligibility will rely on factors like income, age, credit history, and employment status among many other criteria. The insurance company will evaluate your eligibility based on these factors and will determine the loan amount and interest rate on your bike.

Step 4: Apply for the Loan

Once you are declared eligible for the loan; the process is fairly straightforward. You can reach out to the provider either directly or via the website to apply for the loan. Once in, you will be required to furnish important personal information for the records.

**Step 5: Loan Approval and Disbursal **

Post application, the company will proceed with your application and perform a credit check. Basis this quick check, your loan will be approved and funds will be released either to you or the bike dealer, based on the policy.

**Step 6: Consider a Bike Insurance **

Opting for two-wheeler insurance when buying a bike on EMI is important as it protects you from financial loss in case of any unforeseen circumstances such as theft, accidents, or natural disasters. You can use this bike insurance calculator to determine what type of bike insurance works best for you.

Step 7: Start Paying Your EMIs

Once the loan is disbursed, you will start paying your EMIs. The EMI amount will be fixed and will remain the same for the entire loan tenure. You can choose to pay your EMIs through various modes such as auto-debit, online payment, or cash. Make sure you pay your EMIs on time to avoid late payment charges and interest.

Step 8: Repay the Loan

The final step in buying a bike on EMI is to repay the loan. Make sure you repay the loan on time to avoid any negative impact on your credit score. Once the loan is fully repaid, you will own the bike outright.

1. Convenient and Easy Process: Taking a bike loan on EMI is a very convenient process as you do not have to pay the entire amount in one go. You can easily manage the loan amount by paying small instalments every month.

2. Affordability: A bike loan on EMI is a very affordable option wherein you can make convenient monthly payments over a period of time and not really feel the financial burden.

3. Improved Credit Score: By regularly paying the EMI on time, you can improve your credit score which will be useful in case you need a loan in the future for other purposes.

4. Tax Benefits: You can avail of tax benefits on the bike loan interest paid as per the Income Tax Act. This can help you save money on the loan.

5. Flexibility: A bike loan on EMI provides you with the flexibility to choose the tenure of the loan. You can select a tenure that best suits your needs and budget.

6. Easy Documentation: The documents required to buy a bike EMI is relatively simple and straightforward. You just need to provide a few basic documents to the bank or financial institution, and the loan can be disbursed quickly.

7. Low-Interest Rates: Insurance providers offer competitive interest rates on bike loans.

The total amount of bike loans in India, both active and outstanding, stood at a staggering 86 thousand crore in June 2022. This number goes to show how many people finance their motorcycles every year. So, if you are planning to finance your bike purchase, it is very easy because of a sturdy financing system in place. All you have to do is to talk to the dealership about it and they will arrange everything. But make sure you review all offers to avoid paying any hefty interest fees. One more thing! - Do not forget to buy bike insurance. It is a legal mandate.