You have decided to get that motorcycle you have always wanted. You saw it down the street in someone's driveway, but then you got a glimpse of the shiny new ones in the showroom and you fell in love. But now you need motorcycle financing, and now begins the headaches! Here are some motorcycle financing tips that may just save you those headaches and thousands of dollars. I know these are not as exciting as shopping for that new motorcycle, but if you are careful you can get the best deal on motorcycle financing and not be paying for that new motorcycle for years and years. You probably are already familiar and have done your homework on the best price and the type of motorcycle you want. You have done your homework for that part. But that can all be for nothing if you end up with the wrong motorcycle financing.
You have decided to get that motorcycle you have always wanted. You saw it down the street in someone's driveway, but then you got a glimpse of the shiny new ones in the showroom and you fell in love. But now you need motorcycle financing, and now begins the headaches!
Here are some motorcycle financing tips that may just save you those headaches and thousands of dollars.
I know these are not as exciting as shopping for that new motorcycle, but if you are careful you can get the best deal on motorcycle financing and not be paying for that new motorcycle for years and years.
You probably are already familiar and have done your homework on the best price and the type of motorcycle you want. You have done your homework for that part. But that can all be for nothing if you end up with the wrong motorcycle financing.
Motorcycle Financing - Get pre-approved
As boring as this is, it is in your best interest to find out just how much you can afford, and go to your own bank or financial institution first. If you get your motorcycle financing at the bank you do all your other banking with, you stand a better chance of getting a good interest rate.
They will let you know based on your income and debt ratio just how much you need for a down payment and just how much you can finance, and for over how many months or years. This way you are armed
You can then head to that showroom with the new motorcycles, armed with the amount you have to spend, and then put your efforts into getting the best sticker price deal you can get, knowing that you have the backing of the financing in place. Sometimes the dealer will give you a better deal if you are paying the total amount upfront.
Motorcycle Financing - Shop Around
You can try other financing situations or companies, but at the end of the day, you are more likely to get the best deal with your own bank. Some will consider a line of credit if you have a home.
Motorcycle Financing - Dealer
If you don't feel your bank or credit union is the best place to get your financing, then you can talk to the dealer where you want to purchase your new motorcycle. But put on your calm hat! They will usually talk to you about financing pretty well beside that brand new shiny motorcycle, they know what they are doing!
They want you to jump at what they offer, but please read the terms. Do not just jump for that bottom line to sign when they say they have approved you. Find out the terms. They could be offering a great deal, just make sure you understand it now, and are not questioning it a year from now when that newness has worn off.
Ask these questions and make sure you understand the answers!
Can I pay this financing off at any time?
If they say NO, that it is a set amount of payments, this means they are guaranteeing their interest they are charging. So there will be no incentive to pay it off, but check the interest rate, you could be paying a lot more for that motorcycle than you planned. Ask what the final payout will be.
Dealers, whether it is for a car or motorcycle financing, tend to talk in monthly payments. They will say "for just 300 dollars a month you can be out on this motorcycle tomorrow" and not really putting emphasis on the amount of months! Bring your calculator, you can figure this out pretty quick.
When you see what the total is with their plan, you may want to rethink your purchase or find a different way to finance, such as a line of credit with your bank. This way you could pay it off when you want.
Will there be any extra charges?
Find out the absolute total, bottom line amount, and take a look at some of the additional amounts that may show up. Discuss these extra charges with them, and don't agree to them if you don't understand what they are for. Sometimes there will be additional surcharges for the financing and other options on the motorcycle. Did you agree to the extra options?
After that, then you need to consider these points below:
Motorcycle Financing - Bad Credit
If your credit is not so good, and you know this now, then you are NOT going to get the best deal when you apply for financing. Why is your credit bad? Get a copy of your credit report and see if there is an unpaid bill in your history. It can be as simple as book club you didn't pay for or some missed payments on something else.
If this is the case, you need to get your finances in order, make those missed payments and get rid of unpaid bills before you go shopping for motorcycle financing. Since motorcycles are considered a "recreational vehicle" then you need to have good credit, or that 10,000 dollar motorcycle could end up costing you 18,000 down the road or more, and is it really worth that?
Motorcycle Financing - Insurance
You have to have a motorcycle license to get insurance with most companies. So if you are getting financing for this motorcycle, they are going to want proof of insurance, so it is a bit of a catch 22 situation. You need to get your motorcycle license first before you even think about getting a new motorcycle.
Motorcycle Financing - Accessories
Just remember that the cost of the motorcycle is not the only expense. But more than likely you are going to want a new helmet, boots, jacket. After all you are not going to want to wear your tattered ones on this new motorcycle, so keep in mind all the extra costs, as these will add up big time. A good helmet can be hundreds and up. You need a good helmet. Just consider the contents when you are thinking of going cheap on the helmet!
Once you have all your financial ducks lined up, then you can buy that motorcycle and enjoy it without and surprises down the road! Motorcycle financing should get just as much attention as shopping for the motorcycle. Be armed with information and you will be in the control seat.