Whether it is a brand-new bike or a pre-owned bike, the amount of love that you have for your bike is the same. Buying a two-wheeler for the first time is a special feeling but it can also be an expensive affair. Second-hand bikes are an excellent and affordable alternative to this. There are a variety of loan options available in the market that you can get to finance your second-hand bike purchase. In this article, we will see what a second-hand bike loan is, its features, benefits, and how to get it.
Second-Hand Bike Loan
A second hand bike loan helps you to purchase a pre-owned bike of your choice and pay for it in monthly installments (EMIs). This loan is available for self-employed individuals as well as salaried individuals. There are various lenders in India that provide this loan to their customers.
The documentation process for this loan is very simple. It includes:
- Identity Proof – Voter ID, PAN card, Aadhaar card
- Age Proof -birth certificate, Aadhaar card, driving license
- Address Proof – Passport, Aadhaar card, utility bills
- Income Proof -Bank statements, salary slips, Form 16
- Passport-size photos
- Two-wheeler vehicle quotation
Second-hand Bike Loan Eligibility
Before you apply for a second-hand bike loan, you have to be clear with the eligibility criteria. Some of the eligibility criteria that will be true for most lenders are:
- Age eligibility: The borrower has to be aged between 21 and 65 years. This loan is not available for minors and senior citizens.
- Income eligibility: The borrower can be a salaried or self-employed professional. He/she should have a stable income source.
- Work experience eligibility: The borrower must have at least 1 year of experience if he/she is salaried and 3 years if he/she is self-employed.
- CIBIL score eligibility: The borrower should have a credit score between 750 and 900.
How to Apply for Second-Hand Bike Loans?
You can apply for a second-hand bike loan online as well as offline. The loan application process for both of these modes is convenient and easy.
Offline Process:
- Choose a bank or financial institution of your choice for the second-hand bike loan.
- Visit the nearest branch of the chosen lender.
- Make an inquiry about the application for, fill in the details, and submit it with the necessary documents.
- The bank executives will guide you through the process.
- If you are eligible, the loan will be sanctioned to you.
Online Process:
- Choose a bank or financial institution of your choice from whom you want the loan.
- Go to the official website of the chosen bank or financial institution.
- Fill in all the required information in the loan application form.
- Submit the application form along with supporting documents.
- After you have applied, the lender’s executive will verify your details.
- If the loan application and documents are correct, the loan amount will be disbursed.
Features and Benefits of a Second-Hand Bike Loan
- Minimal documentation: The application process for a used bike loan requires very minimal documentation and is straightforward. You only have to submit identity proof, details of the two-wheeler you want to purchase, and address proof. You do not have to give extensive financial details or collateral.
- Flexible eligibility criteria: Used bike loans do not have fixed eligibility criteria like traditional bank loan. You can get a loan even if you have a low CIBIL score or bad repayment history. Some banks or financial institutions might require proof of employment or income details to make sure you are capable of repaying the loan.
- Loan tenure flexibility: Used bike loans usually offer flexible loan tenures ranging from six months to several years, letting you choose a repayment tenure that suits your needs.
- Low-interest rates: Used-bike loans have a lower rate of interest, making them a cost-effective financing option. Depending on the lender and your creditworthiness, the lender might even offer you a lower bike loan interest rate compared to a traditional bank loan.
- Quick approval: A lot of lenders give quick approvals for a used bike loan, which means that the disbursal of the loan amount is quick. It can be helpful, especially in case you need to buy a bike quickly and do not wish to wait around for the bike loan to be approved.
- Collateral: The collateral requirements for the loan vary depending on the lender and used bike loan terms. Some lenders may ask for collateral, such as an asset or bike, to secure the loan. In most cases, however, collateral is not required.
Things to Keep In Mind When Applying for a Second-Hand Bike Loan
Before you apply for a used bike loan, you have to remember a few things:
- Loan amount and budget: Make sure you have an idea about the bike’s cost, your repayment capability, and how much you can afford to pay in monthly installments. After you have a budget, look for a used bike loan that best suits your needs.
- Credit score: Your CIBIL score and repayment history determine the interest rate and loan eligibility. Before you apply for the loan, go through your credit report to make sure they are up-to-date and accurate. Consider increasing your credit score in case it is low to improve your chances of getting a better bike loan interest rate and loan term.
- Eligibility criteria: You have to meet the basic eligibility criteria in order to qualify for the loan. It varies from lender to lender, so make sure you choose the right bank or financial institution for the used bike loan.
- Additional charges: Charges such as late payment charges, prepayment charges, and processing fees can sometimes be levied in addition to the interest rate. Make sure you know about these charges beforehand and factor them into the overall budget.
- Terms and conditions: Make sure you go through the terms and conditions before you sign the loan agreement. Make sure you understand the repayment period, loan interest rate, and other charges associated with the loan. In case you have any doubts, clarify them immediately with the lender before you sign the loan agreement.
Buying a used bike can be a great option in case you are looking for a cost-effective solution. With due preparation and research on your part, you can find a used bike loan that fulfills your needs and requirements. Consider aspects like loan terms, interest rate, and tenure before you choose a loan.
