Advantages of Bank of Baroda Two-Wheeler Loan
16 May 2022
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Motorcycles are the primary means of transportation in a vast majority of Indian households. Two wheelers also make it easier to manoeuver India’s busy streets very quickly. Hence, India is among the top 4 largest motorcycles markets across the world. Also, good two wheelers can get fairly expensive, costing above Rs 1 lakh. A two-wheeler loan can help you afford the bike of your dreams with ease. In this regard, the Bank of Baroda two-wheeler loan offers easy funding for your vehicle. Interested to know more? Let’s take a look at the features of the Baroda two-wheeler loan.
What Is Baroda two-wheeler loan?
Bank of Baroda offers two-wheeler loans with affordable equated monthly instalments (EMI). The interest rates are affordable as well, with nominal processing fees and higher loan amounts. That way, you can purchase a new motorcycle with ease and not have to worry about the finances involved.
Why should you opt for a Bank of Baroda two-wheeler loan?
Saving up cash to buy a motorcycle can get difficult and tedious. With so many other bills and financial responsibilities, your dream of buying a scooter or bike may be a long way off. A two-wheeler loan helps you get the vehicle you want when you want it by giving you ready finance. When you choose bank of Baroda as your two-wheeler financer, you also enjoy many more benefits. To that effect, here are the key reasons why you should consider Bank of Baroda’s two-wheeler loan for your brand-new motorcycle.
• Attractive interest rates
The interest rate is the most important determining factor when it comes to any type of loan. Bank of Baroda keeps its interest rates affordable so that borrowing becomes easy and accessible. The Bank of Baroda Two-Wheeler loan interest rate is as follows:
Baroda Repo Linked Lending Rate (BRLLR) + Strategic Premium + 4.00%
If you are an employee of Bank of Baroda or were previously working with the bank, you only need to pay the BRLLR and the strategic premium. If you opt out of the credit insurance cover, an additional risk premium of 0.05% is applicable. (Mandatory requirement of credit shield in form of Term Life Insurance or Group Credit life Insurance for loans above Rs. 3.00 Lakhs)
• Minimal processing charges
With effect from 2019, Bank of Baroda levies a processing fee equivalent to 2% of the loan amount. The minimum fee is Rs 250 + GST. For example, if you apply for a two-wheeler loan of the amount of Rs 60,000, the processing fee would be 2% of Rs 60,000 = Rs 1200. No pre-closure charges
Pre-closure or foreclosure or prepayment penalty is a penalty fee that lenders charge you if you wish to repay the loan before your tenure ends. However, Bank of Baroda does not charge its customers any kind of pre-payment penalty if they choose to close their loan before its set tenure. This way, you can actually choose to pay off your two-wheeler loan before its due tenure in case you want to free up credit for other loans or financial obligations in the near future.
• Higher loan amount of up to Rs 10 lakh
Motorcycle enthusiasts around the country can now go ahead and buy the two-wheeler of their dreams. The maximum limit of the loan amount from a Baroda two-wheeler loan is Rs 10 lakh. With this kind of a high loan amount, you can choose from among the best bikes or superbikes available.
• Speedy approvals and disbursals
A two-wheeler loan requires minimal documentation, unlike loans or home loans, and get easily approved easily. If you are salaried or self-employed, the common documents required by Bank of Baroda are:
- Application form with passport size photos,
- Photo ID with age proof (Aadhaar card, Passport, Driving License),
- Address proof (Aadhaar card, Passport, Driving License, Voter ID, utility bills, bank statements or passbooks, rent agreement),
- Last 6 months’ bank statements and
- Two-wheeler quotation
Salaried applicants are also required to submit their salary slips and Income Tax Returns or Form 16. Self-employed applicants can submit their Income Tax Returns, business proof and balance sheets.
• Easy To Acquire
Two-wheeler loans only require you to fulfil the gross monthly income (GMI) criteria; higher credit scores are not a prerequisite at all. So, whether you are salaried, businessperson or a farmer, you can easily avail of a two-wheeler loan. Another criterion to remember is that you must be at least 21 years of age; the upper age limit is 70 years after the repayment period.
• Flexible repayment tenure
With affordable EMIs, you can conveniently repay your two-wheeler loan at a pace that suits your budget and other financial commitments. The Bank of Baroda two-wheeler loan offers a repayment period of 5 years (60 Months), which takes the pressure off of loan EMIs. You can choose the desired EMI plan so that the loan does not come in the way of your financial planning. If you are wondering how your monthly payments will look, you can always use the Bank of Baroda two-wheeler loan EMI calculator to check your monthly payments.
• Tax benefits for business use
As a self-employed businessperson, if you use the two-wheeler for business purposes, you are eligible to claim tax benefits. Fuel cost, maintenance charges, two-wheeler insurance and loan interest repayments can be deducted from your taxable income, under section 80C of the Income Tax Act, 1961. Remember, tax deduction is not applicable for motorcycles that are bought for personal use.
• Helps build credit
A two-wheeler loan is sort of a stepping stone towards building your credit score. While these loans do not require you to have high credit scores, any other loan, such as personal, car or home loan, need higher credit scores. Or else, you may end up with costly interest rates. Hence, a two-wheeler loan is the easiest way to start building a good credit score; and good credit score comes with timely repayment of the loan.
Since two-wheeler loan EMIs are pocket-friendly, you have more room to invest your funds. This helps build financial discipline, which is crucial considering our expenses and purchasing power. Also, you have funds ready for emergencies.
Bikes and scooters are by far the most affordable means of transportation in India. Be it a corporate professional, a businessperson or a farmer, a bike serves everyone. Firstly, higher credit scores are not necessary, and the loan is easy to acquire. All you need to present are your ID and address proofs and income and income tax return proofs. Plus, affordable interest rate means affordable EMIs, allowing you to make efficient use of the available funds. If you are new to loans, a two-wheeler loan is the easiest way to build your credit score. A Baroda two-wheeler loan offers attractive interest rates, higher loan amounts of up to Rs 10 lakh, flexible repayment tenures up to 5 years and minimal processing fees.
For more information on how you can apply, reach out to us today.
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The contents of this article/infographic/picture/video are meant solely for information purposes and do not necessarily reflect the views of Bank of Baroda. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Bank of Baroda and/ or its Affiliates and its subsidiaries make no representation as to the accuracy; completeness or reliability of any information contained herein or otherwise provided and hereby disclaim any liability with regard to the same. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject Bank of Baroda or its affiliates to any licensing or registration requirements. Bank of Baroda shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.
How to Pay Off Your Personal Loan Quickly?
A personal loan can prove to be a boon in helping you meet planned and unplanned expenses. Many borrowers often prefer personal loans over other types of loans as these loans are apt for all purposes. Whether you need to fund your home renovation or take that long-overdue family vacation, a personal loan can help fund a variety of expenses.
9 Best Home Loan Tips 2022
A home not only provides a roof over your head, but also doubles up as an investment. Your property can be sold for money at some point in the future. It can also function as collateral for a loan. Home loan is one of the best ways to finance the purchase of your dream flat or house. A home loan helps you safeguard your savings and gives you all the required flexibility to repay the cost of your property with comfort and ease by the way of EMI.
Now, there are so many options of home loans available out there. Choosing just one among all these can be quite confusing. To help you get the best option, here are a few home loan tips that can prove helpful.
1. Check your CIBIL score
Home loans are typically of high amounts and long tenures; thus, they can only be given to individuals who have a good credit history. The minimum home loan credit score required by most of the banks in India is ranges between 650-750. Furthermore, your CIBIL score is directly proportional to the loan amount you are eligible for. This means that having a higher CIBIL score helps you procure loans of higher amount. Generally, having a CIBIL score of 750 and above is considered ideal for procuring a good and substantial value of a home loan. If you check your CIBIL score and find it to be below 650 or just at par with 650, it is better to work on increasing your score before applying for a home loan. Having a good CIBIL score can also help you procure a loan at a relatively lower interest rate.
It is recommended to check your CIBIL score every 3 to 6 months. This will help you keep track of your creditworthiness and devise a strategy to increase your score.
2. Start saving for a down payment
It is important to plan your finances and save up for the down payment before initiating your application for a home loan. This is, perhaps, the best home loan advice that anyone can give you. Lenders typically require you to pay 10% to 30% of the total purchase value of the house or property as down payment depending on your loan amount.
With increasing expenses, it can be quite difficult to save for your home loan down payment. However, making small changes in your monthly budget can ensure that a portion of your income is put aside in a savings account/Investment account etc. to build a corpus for the down payment.
3. Get your financial documents in order
When you take a home loan, you will be required to provide your lender with certain documents such as your recent salary slips, ITRs, and bank account statements, among other paperwork. It helps to keep these documents ready in advance so that you do not have to rush at the eleventh hour to find what you need.
The list of documents required for a home loan can vary between lenders. The documents required can change slightly depending on whether you are salaried or self-employed. Hence, it is better to check with the lender about the records that are required by them. You can easily get a list of required documents by visiting the lender’s website or by calling them up directly.
4. Use a home loan EMI calculator
Understanding your EMI payments is one of the most important home loan repayment tips to keep in mind. Calculating your monthly EMI payments before applying for a home loan can help you avoid taking on debt that you cannot afford to repay.
EMI calculations are dependent upon the interest rate charged and tenure of the loan among many other factors; hence, EMIs are not that easy to calculate manually. Fortunately, you can use the lender’s home loan EMI calculators online to get an idea of the loan amount that you can afford to borrow.
5. Select the right type of home loan
There are many different types of home loans offered by every lender. Bank of Baroda offers its customers different types of home loans including top up loan, home improvement loan, and a home loan takeover scheme, among others. Each type of home loan offers different benefits to borrowers. Hence, it is better to compare bank loans and choose the right home loan that best suits your needs.
When taking a home loan, you can also choose between a fixed interest rate home loan or a floating interest rate home loan. While a fixed interest rate loan will have a constant interest rate throughout the loan tenure, the floating interest rate will see the interest rate change as per the market.
6. Compare the different home loan offers
The cost of procuring a home loan varies between lenders too. When selecting a home loan, you should consider the interest rate charged, home loan processing fees, application fees, technical valuation charges and other such expenses before starting your application process.
To get the best home loan in 2022, do make sure to compare the different loan offers and the other ancillary costs that are associated with borrowing. This research will help you make a smart choice. Remember that a home loan is debt that you take for a long term – generally between 20 to 30 years. So, you would want to pick the best loan provider who fulfils your financial needs for peace of mind.
7. Stay connected with your lender
After you submit your loan application, the lender may require some additional information from you before processing it ahead. Giving quick responses to the lender will help you get the loan amount disbursed swiftly.
It is also imperative to stay in touch with your lender throughout the loan tenure. This will help you build trust with the lender and get the timely help if needed.
8. Keep your credit score maintained during the loan processing period
Lenders typically check your credit score before accepting your loan application. However, they can also pull up your scores again before sanctioning the loan. This helps them ensure that you are a creditworthy individual and are consistent in repaying your debts. Hence, do not get lax on your payments after the lender has accepted your home loan application. Rather, pay more attention to your credit card bills and ensure that they are paid on time. It is also better to avoid applying for new loans until your home loan is sanctioned. This will help you maintain your credit score.
9. Read all the loan related documents carefully
It is particularly important to understand the different terms and conditions of the home loan before signing the documents. Ensure that you go through the documents and get comprehensive knowledge of what you are signing up for. You can contact your lender and ask them for any help you need in understanding the fine print.
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