Is It a Good Idea to Buy a Superbike on a Loan this Diwali?

Superbikes and sport bikes are gaining more and more popularity among Indian youngsters and professional riders. It is an excellent means of transport that gives thrill, better torque and power along with its high performance, so many people are replacing their roadsters with superbikes. As the demand for superbikes is continuously increasing in the country, many banks and Non-Banking Financial Companies (NBFCs) have started offering superbike loans that are exclusively for premium bikes.

What is a superbike loan?

• Although there is no particular definition for a superbike, we can roughly say that "A superbike is a high-performance motorcycle that typically comes with an engine capacity of 500CC and above.".

• Superbike Loan is a secured loan that you can use to purchase your dream superbike at an affordable rate of interest. It is a credit facility that is offered exclusively for superbikes.

• It is a secured type of loan that is backed up by your superbike. Hence, your superbike is hypothecated with the lender until you repay the entire loan amount.

• Most leading banks, suck as HDFC bank, SBI, Bank of India, etc. offer superbike loans at competitive interest rates.

• Salaried, self-employed businessmen, and self-employed professionals with a good credit score can apply for the superbike loan.

• The rate of interest on superbike loans ranges between 7% p.a. to 15% p.a., depending on the lender and loan features.

• The processing fee varies from lender to lender. Some lenders do not charge any processing fee for superbike loans. Whereas, most lenders charge a processing fee of 1% to 3% of the loan amount.

• The maximum loan amount you can avail of through a superbike loan is up to Rs 50 Lakhs. However, different lenders have different criteria and maximum limits.

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Why it is a good idea to buy a superbike on a loan this Diwali?

1. Festive offers:

   The COVID-19 pandemic has affected almost all the sectors and to attract customers, manufacturers and distributors have already started aggressively marketing since Ganesh Chaturthi, the start of the festive season. The Indian market is flooded with 'do not miss' offers and heavy discounts for this Diwali. Apart from the discounts and offers from the merchant's side, the financial institutions are no behind. Many banks and NBFCs are offering offers such as an instant discount on debit card and credit card purchases, extra cashback, reduced rate of interest, zero or low processing fee, instant online disbursal of loans, zero-cost EMIs, discount coupons of leading brands, etc. Furthermore, many banks and NBFCs have tied up with leading online and offline merchants for special discounts and quick disbursement of loans.

   Many two-wheeler dealers and financial institutions are offering such attractive offers on two-wheeler loans and superbike loans, which you can take advantage of this Diwali.

2. New bike models:

   Many leading premium two-wheeler manufacturers, such as Harley-Davidson, Triumph Motorcycles, Suzuki, Ducati, Indian Motorcycle, KTM, Kawasaki, etc. launch or promote their new models during the festive season with various offers. Moreover, banks and NBFCs offer special offers on superbike loans and two-wheeler loans for the top-end models as the amount of these loans is very high. By smartly taking the advantage of such discounts and offers, you can extend your budget a little and buy a higher variant of the bike.

3. Maximum loan amount:

   Many banks and NBFCs offer superbike loans up to 85% to 90% of the on-road price. So, even if you do not have sufficient funds at the moment, you can still buy your dream superbike with a nominal down payment.

   If you do not have sufficient funds for a down payment and still need to buy a premium bike or regular two-wheeler, you can avail of a personal loan and get a loan up to 100% of the on-road price. With a personal loan, you can get any amount you are eligible for and there is no restriction on the usage of the amount. This way you do not have to worry about the down payment. However, the rate of interest on a personal loan is higher compared to the two-wheeler loan.

4. Additional loan for accessories:

   As the superbikes and sports bikes are very expensive, the cost of their accessories is also very high. Buying premium bike accessories, such as helmets, protectors, eyewear, rain gear, riding glows, jackets, luggage and storage boxes, face masks, etc. can become an out-of-budget expense for many riders. Fortunately, most leading lenders offer additional loan amount for accessories up to Rs 2,00,000.

5. Online application:

   Most leading banks and NBFCs offer online application facility for superbike loans. This is a convenient way to avail of a loan as you can apply from the comfort of your home and opt for a doorstep paperwork facility. So, once you have successfully applied for a superbike loan, the bank/NBFC representative will visit your place at your convenient time to complete the documentation process. However, before applying for a loan, make sure you first check with the lender if this facility is provided.

6. Longer loan tenure:

   The superbike loan typically has a longer loan tenure of five years, compared to the regular two-wheeler loan or personal loan, as superbikes are expensive and they require a higher loan amount. The longer loan tenure makes the EMIs more affordable. However, you should remember that the higher the loan tenure, the more the interest outgo.

What are the eligibility criteria to avail of a Superbike Loan?

Since it is a secured loan, there are no stringent eligibility criteria to avail of a superbike loan. However, you should fulfil the basic criteria as given below:

• You should be an Indian resident.

• With most lenders, the minimum age requirement to apply for a superbike loan is 21 years, and the maximum age limit is 65 years.

• You should be financially stable and have repayment capacity. So, salaried, self-employed businessmen, and self-employed professionals can apply for the loan. However, your net annual income should be at least Rs 2.5 Lakhs.

• You should have a good credit score for the loan to get approved.

• You should provide the required documents to the lender, such as identity proof, address proof, income documents, bank statement, passport size photograph, superbike quotation from the dealer, etc.

To Conclude:

Superbike has exceptional features that make it special from other two-wheelers. If you are dreaming of owning a superbike, this festive season is the best time to buy it. And, the various offers from the banks and NBFCs on superbike loans make it all the more attractive and affordable. However, the superbike loan features, rate of interest, other charges, etc. vary from lender to lender. Therefore, before applying for a loan, it is advisable to do a proper comparison of different loan offerings and their costs to make an informed decision.

Warm Regards,
Ketki Jadhav
Content Writer

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