By 2025 the two-wheeler loan market (new and used bikes) is projected to be a $12.3 billion industry. Since borrowers usually avail of a substantial loan amount to purchase two-wheelers, the EMIs are high. This is where a bike loan EMI calculator comes in handy. Read on to know how to use an online two-wheeler loan EMI calculator, how it works and more.
A bike loan EMI calculator enables you to compute your fixed monthly obligations for this high-value purchase you have made using the obtained loan amount. After having a detailed idea, you get to plan your monthly two-wheeler loan repayment better.
Rate of Interest (P.a)
Loan Tenure (Months)
Manual calculation of EMI for a bike follows the formula given below:
EMI = [P x R x (1+R)^N]/[(1+R)^N-1]
Where P, R and N denote principal amount, interest rate and the number of monthly instalments respectively.
However, using the online EMI calculator make the process easier. To calculate EMI online, you will need the following details:
There are many benefits of using a bike loan EMI calculator:
Unsecured loans enable individuals to opt for substantial funds without having to pledge any asset as collateral against it. Navi offers instant cash loan of up to Rs. 20 lakh at attractive interest rates. To get immediate financial assistance for financing the purchase of your new bike, download the Navi app and apply for a personal loan.
You should also remember that assessing one’s repayment capacity is essential to managing the loan smoothly. A bike loan EMI calculator helps borrowers to plan everything out beforehand and avoid falling into a debt trap.
Many banks and financial institutions that offer bike loans have an EMI calculator on their website or app. Follow these steps to calculate bike loan EMI:
You can compare different combinations of repayment tenure and loan amount to check what amount will be easy for you to bear each month. Based on that, you can come up with your own repayment strategy and manage other liabilities smoothly.
You can consider the following ways which will help you lower your burden:
Bike loan EMI will have the following factors which might affect your repayment. So, make sure to check them beforehand:
Any aspiring individual looking to purchase a bike on loan must use an online EMI calculator. This will reduce the chances of defaulting in future. A bike loan EMI calculator computes the actual EMI amount and the interest outgo. One should use this calculator to arrive at an EMI value that he/she can comfortably repay. The calculator gives an opportunity to change the loan amount or the repayment tenure accordingly.
If you fail to make the EMI payment by the due date, you will receive a message regarding the same and a penalty will be levied on the payment. If you continue to miss bike loan EMIs, after 90 days it will be considered a non-performing asset (NPA) and as vehicles are usually hypothecated to the lender, it can start legal proceedings.
You should consider the following things before applying for a two-wheeler loan:
Before purchasing high-value products, it is essential to check whether you will be able to bear the additional costs it comes with. If you are planning on availing of a bike loan to finance such a purchase, you should be aware of its intricacies as well. In this regard, calculating your monthly obligations using a bike loan EMI calculator is not enough. Look out for the associated charges, eligibility parameters, document requirements, etc. as well.
Ans: Lenders usually charge a processing fee on bike loans. However, the exact fee percentage can vary from one lender to another. Keep in mind that processing fees are additional charges which you cannot compute using a bike loan calculator.
Ans: Lenders provide bike loans at varied rates depending on borrowers’ eligibility and other factors. You can find out the quoted interest rate by contacting your chosen financier. In some cases, you can also get this information from a lender’s official website.
Ans: The easiest way to lower your monthly instalment is to opt for a longer repayment tenure. Additionally, you can choose to borrow a limited amount and pay a portion of your bike’s cost from your pocket.
Ans: For any loans, foreclosure refers to paying off the dues before the tenure runs out. Borrowers need to pay a lump sum amount to clear their outstanding principal and foreclose a loan. Bike loan foreclosure can reduce your total interest cost on a loan.
Ans: Generally, you need a credit score of 750 or more to avail of unsecured loans. However, if you have a long-standing relationship with your chosen lender, they may allow you to avail a loan at high-interest rates.
Ans: The minimum tenure for availing of bike loans is of 12 months which can go up to a maximum of 48 months and for superbikes, it can go up to 60 months.
Ans: There is a processing fee while applying for a two-wheeler loan charged by the lender. It can vary from anywhere between 1% and 3% of the loan amount.
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Disclaimer: This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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