Is buying Bikes on EMI a better option than Paying in Cash ?

How many of you are tired of traffic? How many of you are tired of standing in bus queues and traveling through the most crowded local trains ? I can bet we all have missed our buses and ended up being late for our job. We all dream of owning a personal vehicle. For some owning a bike is their dream. But not everyone can afford it. Middle class people let go off their dreams because of the rising prices. We all at some point wanted to own a bike for easy commute. But what if I tell you that you can make your dreams come true ? And this is possible. You can own a bike even if you can’t afford it at the moment. Now you do not have to get frustrated when the auto driver says no to go to the location you want. Because now you can own the bike of your dreams.

One of the best option for a middle class person be it upper middle class or lower middle class who always have dream of buying a bike can come true even if he or she can not afford it at the moment. This is what bike EMI’s are for ! There are some people who like to buy or even prefer to buy vehicles on EMI that is to pay the entire amount into equal small parts for a particular period of time. But on the other hand there are people who also prefer to buy vehicles by paying full cash at once.

But even when you have full cash that is the full amount it is not advisable to pay the entire amount because of some factors. Life is unpredictable. You can not predict what will happen tomorrow or even next minute. We all know the concept of ‘Emergency money’. You always have to have a long vision and think about the future. You should always keep a lump sum of money just in case of emergency. So it is not advisable to spend a lot of money just at once. Now this is where buying a bike in terms of EMI comes into picture. Even if you have cash going for EMI payment still is a better option. Because this will not let you fall in cash deficit ever. So even if something goes wrong you will still have your hard earned money. Now you must be thinking that paying in EMI will lead to paying more for the bike. But no , that is not completely true.

There is always an option to pay a bigger down payment while buying the bike which in turn reduces your remaining amount and also reduces the monthly EMI. Now this way you will have your money in hand just in case if any emergency strikes and at the same time you will not end up paying more for your bike. This therefore becomes a win win situation for you !

Benefits of buying a Bike on EMI

• When you take small loans and pay it off in EMI that is equated monthly installment you eventually build a better credit score. Since the amount is not that huge the EMI’s will be a lesser amount and paying this on time will lead you to gaining benefits by increasing your credit score. Usually the EMI aim bikes are on the lower side which reduces the risk of not paying the EMI on time by default. Hence when you pay such EMI’s on time it reflects positively in your credit score history. Now this helps you a lot in future as you will get quicker approvals on higher interest rates on your future loans.
• Many banks are usually connected with the bike dealers and showrooms as well which might help you get extra offers on your bike. Some also include free insurance cover and at time they might not even charge you registration fee. So you end up saving a huge amount.
• You might be really dreaming of getting a specific bike model but that might be out of your budget. Now when you go for a loan you do not have to worry or even compromise the bike of your dreams because you will be paying the amount in small parts every month. So this leads to having many more options and hence you can select the best bike model for you.

Disadvantage of buying a Bike on EMI

Every coin has two sides so now let’s look at the disadvantage of buying a bike on EMI –

1. You will have to make sure that you pay your EMI’s on time.
2. You will always have to let go off some amount paid for EMI a from your salary.
3. You will have to pay the interest when you might end up paying more than the actual price.
4. The biggest disadvantage is that the interest is calculated on the total amount of the bike. So when you have already paid a down payment paying interest on the amount you have already paid does not make sense.

Now when you look at the other side of the coin that is paying money in cash in this case you will have to pay the entire amount. You will also have to pay the registration fees and you will also have to cover the insurance of your bike. Which would have been waived off if you would have gone for a loan. When you pay such a huge amount at a time you end up spending your savings which you have been trying to save for months. So it depends on the person to make sure of his financial condition first inspite of having the entire amount in hand. It is advisable to have a long term vision and think about the future before draining your savings account. But you can also go for paying the entire amount in cash all at once as you won’t have the burden of paying it every month. So choose what is the better option for you and make a final decision.

People are worried that they will end up paying more amount than the actual price of the bike because of high rate of interests. But what if I tell you that you can buy a bike on EMI without even paying interest!

How to buy a bike on EMI without paying interest?

Yes it is now possible to buy a bike without paying interest. This is possible with the no cost EMI option. For example if you choose to buy a bike for Rs. 1,50,000 on no cost EMI for a tenure of six months that is you have to pay the amount to the bank within the period of six months in small parts. All you have to do is check the offers by various banks and the perks that they offer along with the loan and finally come to the best option for you.

Concluding the benefits of buying a bike on EMI are more than buying it by paying full cash. So one has to give a thought and consider all the factors before coming to a final decision. Even after seeing so many benefits of buying a bike on EMI you still have to verify, study and choose what is the best deal for you. So it is advisable to do a market research go through the bank offers and also the best bike model for you. And once you have done your market research and thought about the future as well including managing the petrol money and considering the emergencies that might strike you are then finally set to buy the bike of your dreams ! So what are you waiting for ? Go turn your dream of buying a bike into reality!