@bhushanrulz: Thanks for detailed explanation.

I feel this can be a sticky thread, as most of the SBK buyers would be opting for a loan this will be very helpful.

There is a catch to this as all things financial

If the EMI is 30000 and you pay 30000 *12 = 360000 for a year then the interest is NOT calculated on (1000000 - 360000)!! for the next year. THis is because the 360000 has an interest component attached to it too.

Lets take the case of an actual 10L loan with a 13% reducing rate (annually for simplicity) and a tenure of 5 years.

YOur monthly EMI would be around 22753 (check with any emi calculator)
and first year payout would be 22753*12 =273036. For the next year, your interest would NOT be calculated on (1000000 - 273036) = 726964!

THis is because the 273036 has both an interest as well as prinicpal component which you are paying. The interest figure is 121162 and the prinicpal figure is 151875.

YOur next years interest would be calculated on on 100000-Prinicpal paid in first year)
1000000 - 151875 = 848125!!!

SO for the second year your 13% reducing rate would be applied on 848125.

So your 5 year schedule would look something like this and you would be paying the 13% reducing interest on ending balance.

Year/ Starting/ Interest /Principal/ Ending Balance
1/ 1,000,000 /121,162 /151,875/ 848,125
2 /848,125 /100,198 /172,839 /675,286
3 /675,287 /76,341/ 196,696 /478,591
4 /478,591 /49,191/ 223,846 /254,745
5 /254,745 /18,293 /254,744/ 0

And a 13% reducing interest is equivalent to roughly a flat rate of 7.3%!

Hope this helps.

just got it

bro recently i got a loan from HDFC bank for my fire blade and got a deal for 13 % reducing in Delhi and if you require i can msg you the no of respective person of HDFC bank who own only deal in super bike Loan and i tried lot but only HDFC is providing loan to these machine.

any idea if they can provide loan for a used superbike??

no bro no bank as of now is providing loan to used legal super bike

basic thumb rule is this

a reducing rate of interest is usually (almost) double of the fixed interest rate.
end of the day you end up paying almost the same amount of interest amount.

what you need to do is haggle with the financiers. all the banks' finance officers have their own margin percentage attached with each loan they process. so you need to talk to a couple of bankers regarding the interest rates. and let them quote the lowest interest rate.
as they say - competition is always good for the customer. so you end up getting the best deal depending on how much you can haggle. always try getting the processing fees out of the equation. they claim that it's mandatory - but try persuading them to waive it off.

now coming to the point of loans for used second hand bikes.
not too sure many banks would be doing it. and even if they do - the interest rate would be really HIGH!! same's the case with used cars.
the best way is to get a personal loan and spend that money on your used super bike. simple.

a good tread for all .... if u people have access to an excel sheet do the full
cell 1 = - principal amt ( use the -ve sign as its a loan amt)
ask if the emi is in advance ( i.e. paid in the same month of the loan hence deducted from the loan amy in same month ) then the cell 1 = - loan amt + 1st adv emi , in case the 1st emi is due the full month then cell 2 will be the emi and cell 3 , 4 , 5 etc the emi upto the no of months u are issuing the pdc for ( every cell represent 1 month )
to calculate the rate of interest u pay use the foll formula in the cell after the last emi has been input =(IRR A1:a37)*12 this will give u the actual rate of interest u are paying this e.g. represents the nos of emi as 36 months .

So irrespective of any corny sales pitch do this calculation u will not go wrong with the real rate of interest paid by u...this is a industry with creative representation of schemes ( I can vouch as i have been the one to come up with many of them in my past career)...cheers and don't carried away with flat / reducing as its just terms that help the masses to simplify the product...focus on the real rate paid ( IRR )

The other simple way is to tell the bloke to give you the per lakh emi and compare an apple to apple structure , lowest emi wins ( saw this in a thread earlier)

Recently I too had a talk with my SBI manager for Iron 883. According to him he has not given any loan for an HD in Kerala but has given for the same in B'lore. Any way according to him, bank will be ready, provided your documents are alright.

On what Interest rate they have given the loan in B'lore??
& What's the interest rate in Kerala??

I dont know how much is the exact rate of interest. any way I will enquire about it and tell.

Another option is to take gold loans from any nationalised bank which can be got @4-6% interest. Its only for 1 year but you can renew it every year by paying just the interest for that 1 yr. Maximum limit for this type of loan is Rs 3L per account. this has become a very common mode of taking a car loan in kerala now a days

I disagree with this. Several nationalised banks do not make any difference between old and new vehicles. Only margin amount (down payment) may vary. They have a limit to age of vehicle though. You can check it here - BOI Star Vehicle Loan

Also personal loan is the the second most expensive loan in industry. Only credit card loans are more expensive.

Here is an excel file to calculate interest and EMI.loan_amortization_schedule.zip

Had a beautiful red/black GT650R in sight, spent this whole week searching for superbike loans. No loan is available for used superbikes. No Nationalized or private bank offers secondhand 2 wheeler loans for superbikes.
I think i will save up for a new SBK

Please thank god that you are saved. Buying a new GT650R is a nightmare IMO. Used would be hell on earth.

Yes sir. I think is was a blessing in disguise. After that seen GTs with a lot of problems. I think i will wait for 2013 Gt650, hopefuly it will have less problem or Triumph to launch there triples. Till then, i will save up for a new SBK loan.

Re: Bank Loans for a Super Bike

Any progress?? today is 21/06/2013 Do share you exp.s it helps a lot.