If you’re tired of waiting for the bus, and fed-up of paying surge charges each time you book a cab, don’t worry! It’s a sign! A sign that’s telling you it’s high time you started thinking about getting your own bike! A bike that’ll help you navigate through traffic and save a lot of time.
For those of you who think two-wheelers are a bad investment, after giving the following points a read, you might change your mind.
Two-wheelers can be pretty awesome because:
- They help you save a lot of time that would otherwise have been spent in traffic
- They’re easier to maintain as compared to four-wheelers
- They’re more economical to run and insure
- They’re less polluting
- It’s relatively easy to get financing for a two-wheeler
Additional Reading: What Is An EMI And How Is It Computed?
If you’re convinced now that a two-wheeler is a good investment, it’s time you choose the right loan.
There are two types of two-wheeler loans:
- Secured- You can avail of a secured loan against the security of some valuable asset like a piece of land, home, or gold. Most two-wheeler loans are secured against your bike. So, your bike is the collateral. If you don’t want the bike to be in the bank’s name until you repay the loan, you put up other assets as collateral instead.
- Unsecured- As the name suggests, these loans are not secured against any asset. These are essentially Personal Loans which you can use to buy your bike.
Tips to choose the right loan product
To ensure that you choose the right loan product without getting confused by the wide variety of options available, here’s a list of things you need to think of prior to applying:
- First things first, decide whether you want to apply for a secured or unsecured bike loan (this choice might be tricky! Think it through).
- Why you should consider getting a secured loan is—since you’re getting it against a valuable asset, the rate of interest is likely to be lower. This automatically means reduced EMIs and the cherry on the cake is the fact that a secured loan might get approved regardless of your Credit History! Phew! That’s a relief! Isn’t it?
- The good thing about an unsecured loan is that you don’t need any kind of security for it. But, yeah, the bad thing is that it comes at a higher rate of interest as compared to a secured one. But then, there are some people who don’t like the idea of pledging their assets. If you’re one of those, this might work beautifully for you!
- In case you want to simplify things for yourself and the lender, you can always make a huge down payment. That way, the lender’s risk is reduced, and you get the benefit of your finances being processed quickly! Who doesn’t love speed?
- Just because we said that you can get a secured loan easily regardless of your Credit History doesn’t mean that a poor Credit Score will always be ignored. If there are some unjustified errors in your Credit Report, things could go the wrong way for you! Be sure to check on this before deciding to opt for a loan.
- If you’ve not won a lottery recently and still need a loan at a reasonable rate of interest, it’s advisable to check your Credit History beforehand and make efforts to bring positive changes in it in case you have a low score.
- Just as you like looking at a lot of options before buying the right dress, shirt or anything; you need to think, compare, and then choose the best loan option according to your specific needs and requirements. Look around, explore all your options and then make the right choice.
What is two-wheeler hypothecation?
Never heard of this term before? Don’t worry! We’ll break it down for you. When you apply for a secured loan, you usually pledge your two-wheeler to the lender to guarantee them some security for the settlement of your loan. This process is called hypothecation.
Once you pay your loan off, you need to get the hypothecation cancelled at the earliest. Here’re some pointers that you need to keep in mind:
- Keep the loan repayment receipt as a proof.
- Duly fill two forms of Form 35 that the lender (bank) gives you.
- Remember to get a postal cover with a Rs. 12 stamp on it and put your name and contact details on it.
- The bank will charge you Rs. 100 as the processing fee for hypothecation termination. Remember to get the receipt for this.
- Submit your bike’s original RC book, a duplicate copy of the Pollution Under Control (PUC) certificate, and a copy of your insurance document along with the aforementioned postal cover and deposit it at the Regional Transport Office (RTO).
- Wait! Before you step out of the RTO office, don’t forget to get the receipt as a proof of your submission for the same.
- Don’t worry! We know that you deposited the original RC book at the RTO office. They’ll send it back to you in a week’s time. That’s why we asked you to put your name and contact details on the postal cover, duh!
- Although it’s a no-brainer, keep a copy of all original documents with you. This rule applies everywhere.
Hopefully, you’ve all the information you need to get the superbike you’ve been eyeing for a while! If you need more, just click on the link below! Oh, and don’t forget to get yourself a good Two-Wheeler Insurance policy.