What You Should Know About Motorcycle Loans
Motorcycles are mostly associated with freedom, especially for nature lovers. Below are a few things you should know about motorcycle financing so you do not need to drain your savings.
Motorcycles are mostly associated with freedom, especially for nature lovers. Unfortunately, your most sought-after freedom often comes at a price. While the cost of used motorcycles averages between $3000 and $6000, a new bike, especially a new model like an electric dirt bike, costs up to $65,000. Unless you are willing to channel all your savings on a premium bike, you should consider getting a motorcycle loan. Below are a few things you should know about motorcycle financing:
Where to Get Motorcycle Loans
Motorcycle loans are just like auto loans. You can apply for motorcycle loans from the following lenders:
1. Online Lenders
You should consider financing your motorcycle loan from online lenders for various reasons. They offer competitive interests and faster approval rates than traditional financial institutions. While some offer motorcycle loans, others have personal loans that you can use to buy a motorcycle.
Banking institutions offer secured motorcycle loans. While secured loans have low-interest rates, the bank can repossess your new bike if you don’t make monthly payments. Military personnel and veterans can access motorcycle loans through USAA Bank.
3. Credit Unions
Most people prefer taking motorcycle loans from credit unions for various reasons. For starters, credit unions offer lower interest rates than banks. However, you should be a member of the credit union to access the loan. Credit unions have different joining requirements. Some are open to the public, while others require affiliation to certain professions. Nonetheless, you can easily find the best credit union that offers motorcycle financing.
4. Motorcycle Dealerships
Most dealerships have lending partners that offer motorcycle financing to interested clients. This certainly simplifies the purchase process but at a higher rate. For brand-new bikes, you can get financing directly from motorcycle manufacturers.
How to Apply for Motorcycle Financing
Follow these steps to get started with motorcycle financing:
1. Check your Credit Score
Begin by checking your credit score to know the type of motorcycle loans you qualify for. Having good credit means you can access most options at favorable rates. If your score is below average, you should find ways of improving it. However, this doesn’t mean you can’t access motorcycle loans with bad credit.
2. Know Your Budget
You should determine how much you can afford to spend on your new bike. This means calculating the down payment and how much you can pay monthly. Making a larger down payment will reduce the amount of monthly payments. You can also choose a longer repayment period to keep the monthly premiums down.
3. Choose the Motorcycle
The next step is shopping for your preferred motorcycle. It should align with your needs and budget. You should have some basic information, like the bake, model, and year when applying for the loan.
4. Apply to Multiple Lenders
With these details at hand, you should apply to multiple lenders. Having multiple quotes or loan offers allows you to compare the rates and terms. Choose your preferred lender and finalize the paperwork.
Getting a motorcycle loan isn’t challenging. Motorcycles are cheaper than cars, and financing is typically less. Securing motorcycle financing shouldn’t be an issue if you can make the down payment and submit monthly payments.