Check Your Eligibility for a Two Wheeler Loan

Two wheelers are frequently chosen because they are less expensive than other vehicles. They also have reduced maintenance costs. Car owners are also spending money on two wheelers because they are easier to operate through traffic. And it is convenient for short-distance commuting in cities. But most borrowers cannot make the lump sum payment due to their limited financial resources. Here two wheeler loans come to the rescue. These loans allow people to purchase the two wheeler of their choice without worrying about funding. These loans enable them to pay through monthly EMIs conveniently. Check your two wheeler loan eligibility as it is a crucial factor once you’ve decided to apply.

Lenders are very careful and only approve a loan after determining the borrower’s ability to repay it. Lenders perform extensive background checks before disbursing a loan. They do it because there has been a dramatic increase in the number of defaulters over time. Submit required documentation and disclose your precise source of income for quick approval.

The general eligibility requirements for two wheeler loans are listed below:

• The claimant’s age must be at least 18 years and a maximum of 65 years at the time of applying.

• The applicant must have lived in the same house for at least a year to demonstrate residential stability.

• The applicant must have held a stable position for at least one year. The applicant also can be self-employed with two years of IT returns.

• The applicant’s CIBIL rating with the credit bureaus should be favourable.

• The applicant should have KYC and other relevant documents and a permanent phone number.

Factors affecting two wheeler loan eligibility:

Your two wheeler loan eligibility is based on your income, credit score, and current financial commitments.

• Credit score- Your credit score is one of the most important criteria your lender will consider when determining your eligibility. It is a three-digit figure that represents your ability to pay back the loan amount on time or not. Maintain a credit score of at least 750 for a two wheeler loan. Certain lenders like Bajaj Finserv don’t ask for a minimum credit score for two wheeler loan eligibility.

• Income- Your ability to obtain a two wheeler loan is also based on your income. Lenders prefer a borrower with a stable source of income as this credit line is an unsecured loan. You must show your lender that you have a reliable source of income. A bigger salary or higher income will guarantee a cheaper interest rate.

• Outstanding loan- Large outstanding debts will reduce your eligibility for a two wheeler loan. You might not be given a loan if your lender discovers that you have unpaid bills right now.

Tips to improve your two wheeler loan eligibility:

• Keep your credit score higher- Make sure you have kept your credit score at least 750 when applying for a two wheeler loan.

• Longer loan tenure- Select a loan with a longer term to allow yourself more time to pay back your EMI. Your eligibility for a two wheeler loan increases when you select a longer loan term.

• Opt for a joint loan- Having a co-applicant with strong credit improves your chances of being approved for a two wheeler loan.

• Show additional source of income- Your additional income demonstrates your ability to repay the loan in full without any hindrance or default.

Documents required for two wheeler loan:

• Identity proof- You have to submit documents to prove your identity. Use your Aadhar card, PAN card, passport, driving license, or electoral voter identity card.

• Address proof- Provide documents like water bill, property documents, latest phone bill, or driving license to prove your residential address. You may also use your Aadhar card, PAN card, passport, latest electricity bill, or latest bank passbook reflecting the current address.

• Additional documents for salaried persons- Salaried persons must provide their offer letter and last salary slip. They must also submit their last six months’ bank statements and the latest Form 16.

• Additional documents for self-employed persons- Self-employed individuals must provide their last three years’ income tax returns and last six months’ bank statements. Sales tax returns, TDS certificates, and company details are important too.