Things to consider before taking Two Wheeler Loan

Many of us may be actively pondering the purchase of a personal two-wheeler as we begin a new year. However, many people are concerned about the exorbitant cost, thus the ideal way to fund our goal is with a two-wheeler loan.

If you’ve been thinking about getting a two-wheeler loan for a while, this post is for you. We’ll go over the top five things you should think about before taking out a two-wheeler loan in India.

Your Credit Rating

Because most two-wheeler loans in India are unsecured, your credit score is one of the first and most essential variables lenders check when evaluating your loan application. Your credit score is determined by four factors:

  • The overall number of loans you’ve ever taken out.
  • The total amount of money you’ve borrowed previously.
  • The overall sum of on-time payments you’ve made in the past year.
  • The total number of payments you’ve been late on

Every borrower in India is assigned a credit score on a scale of 900. Most lenders provide two online approval alternatives for two wheeler loans. However, in order to take advantage of this, you must have a good credit history.

Type of Loan

Secured and unsecured loans are accessible in every category around the world, and the same is true for two-wheeler loans. A secured loan requires you to pledge an asset or collateral of equal or greater value than the loan amount. An unsecured loan, on the other hand, does not require the pledge of any asset or collateral.

Although the majority of two-wheeler loans offered in India are unsecured, some lenders do offer secured loans with lower interest rates.

Your Loan’s Duration

The duration of the loan is the third factor to consider while looking for the finest two-wheeler loan. Most lenders in India provide terms ranging from 12 to 60 months, allowing you to efficiently manage both your personal budget and the stress of repaying a loan. However, you should keep in mind that a longer repayment period often means a higher interest rate because the lender’s risk is bigger. As a result, a loan with a shorter term is preferable.

The Types of Interest Charged

Rates of interest can be broadly classified into two types in the lending world: fluctuating and fixed. A variable rate of interest is one in which the rate of interest rises or falls over time, depending on a range of factors such as current market conditions, the remaining loan balance, your credit score, and the number of payments you’ve made previously (both timely and missed). On two-wheeler loans, just a few lenders offer a flexible interest rate. A fixed rate of interest means that the rate of interest agreed upon between the lender and the borrower at the time of signing the agreements will remain constant throughout the loan’s term.


  • Aadhar Card, PAN Card, Voter ID, and other eKYC documents
  • Salary slips, ITRs, and the most recent bank statement are all acceptable forms of proof of income.
  • Photographs of passport size and a cancelled check

By taking advantage of the greatest two wheeler loan, you can make your goal of owning a bike a reality. So, think about the aforementioned factors and make an informed decision.