back to articles | February 10, 2023 | Moses Mwangi

Categories: Vehicle & Buying Research

Can You Finance a Motorcycle with No Credit?

Buying a motorcycle is a dream for most two-wheeler lovers. However, the primary question often arises in how to finance the purchase, especially if you do not have credit. Like auto loans, motorcycle loans rely significantly on credit history and score.


Buying a motorcycle is a dream for most two-wheeler lovers. However, the primary question often arises in how to finance the purchase, especially if you do not have credit. Like auto loans, motorcycle loans rely significantly on credit history and score.

But what happens if you lack credit? A lack of credit means you cannot access any credit accounts. In other cases, your credit history is minimal for credit score calculation. Below we strive to answer the question of whether you can finance a motorcycle with no credit.

Is credit necessary for motorcycle financing?

Technically one does not require credit to finance their motorcycle purchase. However, having some form of credit history can be a huge plus for you. The lenders can use your credit history to determine your creditworthiness.

If you have no credit, you can still get a motorcycle loan, but getting the loan will be harder compared to someone with good credit. Also, you will find that a motorcycle loan for anyone with no credit will have a higher interest rate, meaning you will have access to expensive loans.

Having no credit makes the potential lending institutions view you as a credit risk. The main reason is that you do not have experience managing any form of credit. The great news is that you can still access a motorcycle loan if you have no credit.

How to finance your motorcycle with no credit?

A lack of credit is a significant issue when getting a motorcycle loan. However, you do not need to get worked up. Here are a few tips that you can use to finance your motorcycle purchase:

1. Know your budgetary limitations

The first thing you need to do if you have no credit is to determine how much you can afford before getting a motorcycle loan. Make sure you have enough details about your budget. It would help if you knew how much you earn every month, your expenses, and what you can afford to pay monthly.

You will feel more confident approaching a lender or a dealer if you know your budgetary limitations. Sit down and note all your financial obligations.

2. Make a large down payment for the motorcycle

Lenders would want to see that you are very serious about investing. Thus, paying a large down payment can act as a sign of your seriousness. Making a down payment will increase your chances of getting a motorcycle loan.

Also, it will save you some money, as the more out-of-pocket you make, the lesser the interest rate will be on the motorcycle loan. In addition, you can consider paying cash for extra gear, such as a helmet and gloves. It will help reduce the amount you want to borrow.

A good rule of thumb is to put a 10% to 20% down payment on a motorcycle. That will get you in a great position and make you a better risk to lenders. Therefore, if you are looking for a motorcycle that costs $9,000, your down payment should range from $900 to $1,800.

3. Get a reliable cosigner

A cosigner can be your friend or family member who has a record of excellent credit history. They should be willing to help you co-sign your motorcycle loan application. The main goal of getting a cosigner is often to reduce risk to your lender.

When getting a cosigner, educate them on their full responsibilities, as the cosigner will be liable to pay the loan if you default on it. The motorcycle loan will appear on the cosigner's credit history. Thus, the cosigner's credit score will change if you default on the loan. It is, therefore, ideal that you maintain a good relationship by making on-time payments if you get the motorcycle loan.

4. Get the right lender

If you have no credit, accessing motorcycle loans may be challenging. You may need to put more effort into searching for the right lender. Also, you should note that applying to several lenders at once may not be good for your credit score.

Thus, conducting your due diligence should be among the first things you need to do. Here are some of the things you should note:

  • Apply to only lending institutions that offer motorcycle loans.
  • You may have to pay high-interest rates because of a lack of credit.
  • Consider the loan terms carefully.

5. Talk with your motorcycle dealer

You can find that some dealers are willing to work with individuals with no credit. The dealers may have relationships with lenders who are willing to work with individuals with no credit. Therefore, they may be ready to help you finance your motorcycle purchase.

You must communicate your no-credit issue with the dealer's finance department. The department will then act as an intermediary with the lender. However, you need to note that the loan may be expensive because of your lack of loan history. Also, not all leaders work with individuals with no credit.

6. Provide lenders with proof of income stability

Most lenders need to look into your finances to establish your fiscal responsibility. They will check whether you have a stable source of income to guarantee you can afford to make loan payments.

Therefore, if you provide lenders with proof of income stability, you can receive a motorcycle loan. Keep in mind that the no-credit motorcycle loan will most likely be expensive. However, despite the high-cost loans, you will still be able to buy your dream motorcycle.

7. Build your credit first before getting a motorcycle loan

Waiting to purchase your dream motorcycle can be extremely tough on you as it may take some time. However, you can derive several benefits by building your credit history first. For one, you can access cheaper loans with favorable terms.

To build your credit, you can obtain a secured credit card. Also, a credit builder loan can assist you in developing a positive history of loan repayments. Another option you can consider is being an authorized user on the credit card of a family member or a friend with a high credit score.

Once you become an authorized user, your friends or family member's account history will be a part of your credit reports. That will increase your chances of accessing a motorcycle loan to finance your motorcycle purchase.

8. Shop for the best motorcycle rate

If you are considering buying a motorcycle and have no credit, always look for reasonably priced bikes. Many lenders may overlook you if you go for costly bikes and have no credit. For instance, you stand a high chance of getting a loan for a motorcycle worth $10,000 or less than one that costs over $20,000.

The main reason behind this is that lenders look forward to handing out loans when the liability to them is lesser. Thus, if you are looking forward to getting a motorcycle loan, shop around first and choose a bike available at a realistic price.

Bottom Line

Financing a motorcycle with no credit can be very challenging for you. The good news is that some lenders may be willing to offer you a motorcycle loan. However, you may have to pay more interest than someone with credit, though you will still end up owing your ride.