How can a bad credit person get a two-wheeler loan?

Having a two-wheeler makes it much easier to go from one location to another, especially in congested metro areas where taking public transportation may be a nightmare. As a result, a two-wheeler has become a vital mode of transportation. Due to many financial obligations, many people would be unable to purchase a motorcycle in full. Taking out a loan is the only way out in this situation. Banks, on the other hand, do not lend money to everyone who applies for one. The loan approval is determined by several eligibility criteria.

What is a good credit score for buying a motorcycle?

Although there is no set credit score for obtaining a motorcycle loan, it is often considered that all financial institutions will accept a score of 600 or higher. Credit scores range from 300 to 900. The higher the number, the more likely you are to be approved for a bike loan. Financial institutions have different restrictions or qualifying circumstances for disbursing a motorcycle loan. As a result, it is advised to keep a good credit score.

A low credit score has an impact on two-wheeler loans

A poor credit score, which is the minimal criterion, is one of the few reasons why many banks refuse an application for a bike loan. A few causes of bad credit are listed below.

Previous or existing loan

If you have an existing bike loan or have just been denied a bike loan and have quickly applied for another loan, your new loan application is more likely to be rejected. This can result in a poor credit score.

Delayed payment

If you don't pay your credit card EMIs on time, your credit score will suffer. Read the vehicle loan agreement before applying.

Credit card bills

Make sure you pay all of your credit card bills on time every month. The reason for this is that the credit rating agency considers the unpaid amount to be past due. Late payments affect your credit score negatively.

Missing payment

This is most likely your credit score's worst-case scenario. Failure to make even a single payment may result in a worse total score.

Multiple credit application

When you apply for credit with many banks at the same time, your chances of getting a hard inquiry increase. Each unfavorable inquiry might significantly lower your credit score.

How to Get a Bike Loan If You Have Bad Credit?

More down payment:

You will have to pay more for a down payment if you have a low credit score. A down payment is a set sum that you must pay on any bike loan you apply for. Banks often finance 80 to 90% of the vehicle through a loan, with the remaining paid in cash as a down payment. Making a down payment lowers your interest rate and shortens the term of your loan. Because the loan amount to be repaid is low, this is a good alternative.

Negotiate better terms:

There are a variety of reasons why you may have defaulted on a previous loan, and these factors can potentially affect your credit score. Even though the interest rate is slightly higher, it is always a good idea to negotiate better credit conditions with your bank and bike dealer.

Compare multiple lenders:

It's always a good idea to keep a few alternatives open when it comes to selecting and comparing different lenders. You can receive a two wheeler vehicle loan from the correct lender with a better interest rate, terms, and conditions if you do enough research. This has been aided even further by a new approach to assessing borrowers' creditworthiness. Additional factors that banks and credit institutions look for include work and a consistent source of income.


A co-signer, also known as a guarantor, is someone who is equally responsible for your bike loan. If you have a terrible credit score, a co-signer with a strong credit score may be another realistic alternative for obtaining a two-wheeler loan. Your co-creditworthiness signers will be taken into account when the loan is approved.

The Advantages of a Two-Wheeler Loan

Low down payment:

The best thing about a bike loan is how little money you have to put down. Banks will lend up to 90% of the bike's worth. You must pay the remaining 10% as a down payment. This means that if your bike is worth 50,000, all you have to spend to get your brand-new bike home is 5,000.

Instant loan:

For loan disbursement, all automobile companies have direct agreements with banks. You may complete the entire transaction online in under a day and have a new bike delivered by EOD.

Repayment tenure:

A bike loan normally has a repayment period of 12 to 48 months. You can also choose from a variety of tenure options for EMI and online payments. This reduces your financial strain and gives you more time to repay your two-wheeler loan.

Flexible tenure:

As previously stated, you can choose a flexible payback period of up to 4 years for 2-wheeler loans.

No charges:

The majority of institutions do not charge any additional fees for the loan amount. This helps to alleviate the financial stress once more.

Insurance cover:

According to the Indian Motor Act, when a loan is approved, the automobile dealer and the bank give insurance coverage for both the car and the buyer for a minimal annual charge.


When granting a two-wheeler loan, several financial organizations use credit score as the primary factor. Bad credit could be the result of defaults from years ago that continue to affect your credit score now. Your financial circumstances may have improved, and you may now be employed despite your poor credit score



I'm Deepika Pandya a financial expert from Pune, India. I love to write articles about finance.
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