Owning a bike is the best way to avoid all the hassle of public commuting. Not only is it cheap but also ideal for reaching places quickly. There is a chance you, too, have thought of buying a two-wheeler, but poor finances made you dismiss the idea.
In that case, there is good news. There are ways you can finance a brand-new bike other than a one-time payment. The best option is to take out a loan. However, banks need a good credit score as an eligibility criterion.
Read this article to find out how to solve the problem of bad credit for bike finance!
Opt for a heavy down payment
Usually, banks give out a loan that covers up to 90% of your instant payment requirement. The interest is calculated on this amount, which you must pay in instalments. The remaining 10 percent of the amount must be paid by yourself.
But in case your credit score is not good enough, there is a chance you will have to bear a heavy down payment amount. This will decrease the insecurity of the banks lending you the money. Moreover, your interest rate will reduce as well.
Find the best lending option
Never choose the first option you come across. It is always best to analyse all the possibilities before making any decision. Many lenders available in the market might help you with the loan. Hence, select the one that is more suitable for your situation.
You might land an offer with better terms and conditions and a lower interest rate. Finally, negotiate with your dealer to land more manageable lending terms to maintain your future credit score.
Get someone to cosign with you
If you have bad credit for bike finance, you can also seek the help of a friend or a family member. They will have to sign the loan terms and conditions with you and be a “co-signer”. In this scenario, their credit score will also be taken into consideration.
Consequently, they will be equally responsible for paying off your loans. This level of accountability from them will allow you to land better lending offers. However, this doesn’t necessarily mean they will have to bear your burden but can be seen as a means to overcome the technical hindrance.
Delaying and working on your credit score
If your requirement for a two-wheeler is not too urgent, consider delaying it a bit. This will buy you some time to improve your credit score. For this, you can start by paying off your outstanding loan amount.
Other than this, you can adhere to some good credit habits. As the score is refreshed every month, you can build a good profile in a few months. For instance, start paying your credit card bill in time. Similarly, avoid any chances of missing other payments.
Buying a two-wheeler might be your dream or a requirement. In any scenario, the incurring cost is high. So it can get annoying if you find that the only obstruction is a low credit score. Especially when, most of the time, the insufficiency is not even justified.
For instance, it could be something as insignificant as not having a borrower history! So don’t give up easily. You can follow through with some of the suggestions from above and get around the problem. It might be tricky, but you can always land a good lending deal for yourself!