When availing of a bike loan, there are a few aspects that lenders consider to determine what your monthly EMI will be. Before going into the two wheeler loan taking process, it is essential that you as a borrower also know what these are to all but ensure approval.
5 Factors Determining Your Bike Loan’s EMI:
A. Credit Score
Your two-wheeler loan’s online approval is highly dependent on your credit score. Your credit score is based on a few important factors such as:
- Number of loans you have previously taken
- The total amount of these loans
- Number of timely payments made
- Defaults in payment
Credit scores are out of 900. A score over 750 is excellent and can immensely help your loan approval.
B. Involvement of Collateral
Unsecured loans (collateral-free loans) have a higher interest rate than secured loans (loans with collateral). With collateral pledged, the lenders are more protected against losing money due to defaults in repayment. This eventually trickles down into the monthly EMI you pay.
C. Loan Amount and Tenure
0 down payment bike loan would mean your loan amount and tenure is much higher. Such a hike automatically increases your monthly EMI. Putting in a hefty down payment will lead to more savings down the road in terms of interest and loan tenure.
Choosing the right lender to help you purchase the vehicle of your dreams is vital. With Fullerton India, you get bike loans at competitive interest rates and flexible tenures. Additionally, our calculators allow you to stay financially prepared for anything!
Additional Read: What is the Ideal Tenure For Your Two Wheeler Loan?
