Securing the Best Motorcycle Loan

Getting a motorcycle should be viewed as any major investment. And like any investment you need to do some research first, whether you will be using your own cash savings or getting it financed. With the cost of money these days, you could still be better off having it financed. You have a choice of getting a personal loan or obtaining a motorcycle loan from the motorcycle dealer which is really no different from car dealers offering in-house car loans.

Things to consider

This may seem too obvious, but it’s better to say it up front. Never start shopping for your dream motorcycle without first assessing you financial muscle. Whether what you have can defray the entire cost of the motorcycle or not, at least you have a starting financial footing when getting into a showroom. Then you can start shopping not just for the motorbike but also for the loan you need to complete the deal, in case your cash savings can only cover a part of it.

Don’t fall into the common mistake of getting 100% financing for your motorcycle. Bear in mind that the larger the loan, the more imposing the interests amounts you have to pay. Also consider a shorter loan term to pay it off. The longer the term, the higher the overall cost of the loan becomes.

Your cash savings can comprise your down payment. A 50% down will go a long way to getting a more comfortable motorcycle loan financing. Take advantage of low interest offers. Armed with a good enough cash savings for a down payment, avail of short term motorcycle loan rates which usually apply for 12-24 month loan terms. See that the insurance coverage and registration fees can be taken off from the loan proceeds as they are often cheap enough for you to pay off. Lastly, get a handle on any surcharges or penalties in case you inadvertently make a delayed payment on the loan so there’d be no surprises along the way.

If you don’t have enough cash savings to form the down payment, you have to accept a more expensive loan with longer term duration to ease your monthly payments. In this regard, it would be good to check that the loans don’t use the “rule of 78” which will slap you with the same interests even if you pay-off the loan balance before maturity. You’d never know if your finances will improve along the way so you pay off the remainder of your loan.