A general study shows that 55% of the population of the world considers loaning a burden, or are having a bad picture of it in their minds. People are more scared of loans and thus neglect the offer of taking loans on their hands even. This is because there are examples of people who weren’t able to repay the loan on time and were gone bankrupt. So we shall discuss the pros and cons of two-wheeler loans to understand that what impact does two-wheeler loan has on us.
Advantages
1) Takes off a huge burden
As India consists of 80% of middle-class people, it is a dream for a lot of people to own a private vehicle and as a matter of fact, some of those people cannot afford to buy a two-wheeler on their own. And that’s where a two-wheeler loan is a great help to these people.
2) Helps your Cibil Score
It is a myth that having a loan on your shoulders decreases your credit score. But repaying EMIs on time and repaying the loan in the given tenure is considered to increase your credit score gradually.
3) Decent Rate of Interest
4) Eligibility Across Income Range
Now a lot of people do not consider applying because they think that they won’t be able to clear the eligibility criteria. But two-wheeler loan has a requirement of ₹15000 as a minimum salary required by the individual.
5) Additional Benefits
Two wheeler loan also covers up the cost for the accessories for your two-wheeler.
6) Flexible and Quick Process
The Documentation required is quite subtle and can be easily done. For example, HDFC Bank has the quickest loan procedure
Disadvantages
1) EMI Load
In some cases people who can barely afford their living and three-time meals too cone forward having a necessity of two-wheeler. But now the EMI loan that falls on them can mismanage their savings and expenditures and thus make it difficult for them to manage EMI along with their living. A two wheeler interest rate differs with every lender.
2) Psychological Pressure
Having a loan also puts a lot of psychological toll on one’s brain and thus people like these are a target of stress, anger, anxiety, or depression.
3) Paying More
Let’s understand this with a help of an example. Let’s suppose a person is opting for a loan of ₹40000 for a tenure of 18 months ( i.e 1.5 Years ) and a rate of interest of 12%. In the end, the person will end up paying ₹45000. Thus ₹5000 more than the actual cost.
Conclusion:
Since every coin is having two faces, two-wheeler loan is also having some of its pros and cons. Now a person shall keep in mind all the conditions that they are in and then take the decision which is kept all picture in the scenario
