Minimum Down Payment Bike Loan

Down Payment Required for Bike Loan

Minimum down payment required for bike loans range from 0% to 30%, depending on your credit profile. This range varies from lender to lender. By making a down payment for the bike, you can apply for a bike loan that covers 60-70% of the on-road price of the vehicle. This reduces the amount you have to repay after factoring in the interest component. Additionally, certain lenders tend to look at applicants more favorably if they make a down payment for the bike loan. 

Every financial year, around 15-17 million two-wheelers are sold in the country. There are more than 210 million registered two-wheelers in India, and bikes are the go-to vehicles for a majority of Indian commuters. Motorcycles are cheaper than four-wheelers, and with a wide range of bikes available on the market, you can choose a model according to your needs and preference. Additionally, with a two-wheeler, it becomes easier to navigate Indian roads, while bikes are fuel-efficient.

Another factor that makes bikes an attractive proposition is the ease with which you can avail of bike loans. Various lenders – banks, NFBCs and captive financiers – provide two-wheeler loans at attractive interest rates. However, you may have to make a minimum down payment for the bike, and it is beneficial to understand the down payment before applying for a two-wheeler loan.

Documents required to get bikes with minimum down payment

If you want to apply for a bike loan and make a minimum down payment, you need to submit a few two wheeler loan documents.

How to Buy Bikes with Minimum Down Payment?

While approaching a lender about the bike loan, you can choose the bike’s minimum down payment you are comfortable paying. This can range from 15 - 30% if a zero down payment offer is not provided. Here is how you can opt for a low down payment bike loan.

• Visit the lending entity’s website or go to their branch

• While applying online, click on ‘Apply Now’ and provide your personal and employment details

• If you are applying offline, talk to a representative from the lending institution and fill out the application form

• Use the online bike loan EMI calculator to get an idea of the EMI amount you will have to pay every month

• Once you submit the details online, a representative from the lending institution will get in touch to tell you about the down payment options, interest rates and other offers

• Opt for the lowest down payment for bikes offered by the lender, and the remaining on-road price of the bike will be covered by the two-wheeler loan amount

Factors affecting Minimum Down Payment

There are several factors that dictate the down payment amount. If you want to get yourself the lowest down payment for bikes, it is important that you keep these factors in mind.

• Bike’s price: If you are purchasing an expensive bike – say, around ₹4-5 Lakhs, then you will have to make a down payment amounting to 20-30% of the bike’s cost. However, if you are purchasing an entry-level or mid-range bike, you will be required to make a minimal down payment.

• Repayment capacity: The greater the repayment capacity, the lower the initial down payment. If the lending entity believes that you are a responsible borrower with a steady income source, you can avail of a loan amount that covers 80-90% of the bike’s cost.

• Credit score: One of the ways in which the lender can assess your creditworthiness is by looking at your credit score. Thus, the higher the credit score, the higher the loan amount that is sanctioned by the lender.

• Relationship with the lender: If you are availing of a two-wheeler loan from your bank or a lending entity you have a good relationship with, then you can get a loan amount that covers around 80-90% of the vehicle’s on-road price.

Eligibility criteria to  Buy Bikes with Minimum Down Payment

Check the bike loan eligibility criteria mentioned below:

* Different lenders have different credit score and minimum monthly income requirements

Conclusion

While select lenders offer zero down payment offers and provide 100% financing of the on-road price of the bike, most lenders require you to pay 15-30% of the on-road price upfront. You can talk to different lending institutions and assess the best interest rates and new bike down payment offers before choosing a lender. Factors like your credit score, relationship with the lender and the two-wheeler’s price also play a significant role in determining the minimum down payment. Lending entities such as Bajaj Finserv offer up to 100% funding of the on-road price of the bike, thus offering the lowest down payment for bikes.