Two-wheeler prices are rising. For example, the whole range of Hero MotoCorp was estimated to see a price hike in July 2021. This is mainly attributed to higher costs of raw materials in the market. Paying from your pocket at this point might derail other financial plans and your overall housing budget. A bike loan is a great option. It makes it easy to afford a bike with a hefty price tag. You do not have to compromise on the expenses. There is no need to give up on your dream bike and settle for a basic one. A loan from the top Indian bank will also ensure affordable EMIs to avoid a financial burden as well.
However, it is a good idea to lower the interest rates. This is not an easy task. The lenders can consider a range of parameters before charging a lower rate. Have a look at a few tricks that might offer an affordable rate to you.
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A Great Credit Score
A score between 700-900 is considered good. You might be able to score the desired interest rate with an impressive credit profile. Try to:
- Clear high-cost debts
- Keep your credit utilization ratio within the 30% limit
- Avoid hard inquiries on loans and
- Keep reviewing your credit profile for errors
- Avoid direct credit card applications and loans
Ticking these off before taking the loan for bike is a sensible idea. These can boost your credit score. The bank judges your creditworthiness before offering an unsecured loan. A good profile will assure them of your repayment capability and negotiate a better rate.
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Professional Background
Well qualified credentials represent your degree and job seriousness. Lenders are able to envision you as someone who is capable of paying off debts on time. Good repayment history is a great way to convince a lender for a lower interest rate on your bike loan.
In fact, banks would also love to serve anyone working with a blue-chip company to boost their service quality. Try to present at least two steady years of employment to enhance your eligibility for a lower interest rate on a bike loan.
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Maintain a Good Repayment History
It is a good way to ensure a pocket-friendly interest rate on your two-wheeler loan. Try to pay off existing EMIs on time. You can consider a personal loan to clear all the other debts like credit card bills and outstanding utility bills. This will help you bargain and increase the chances of better interest rates. The lenders will know that you have been able to manage your debts with a stable job and income and have lower risks of default.
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Employment History
A job with the central government, quasi-government, PSUs and similar organisations attract lenders. It can reflect your reputation in society along with your financial capabilities. Try to have a steady income. Present at least a year of gapless employment with your current company. These are great ways to grab a desirable interest rate on your bike loan.
Lower interest rates make it easy to manage a loan in the long run. You are less likely to face financial challenges in future. Put these tips into action while working with a reputable bank.
