Financing a Motorbike: What are Your Options?

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via | Financing a Motorbike: What are Your Options? | Purchasing a motorbike is an exciting time, but you might find yourself feeling almost guilty at the extra financial burden you’re taking on. While some people opt for a motorbike over other forms of transport, most of us will purchase a bike as well as a car. This will mean having to adjust to paying off two insurances, road taxes and all the rest – not forgetting the initial cost of the bike.

Handily, there are financing solutions that give you a bit more flexibility when it comes to purchasing a motorbike. We’ve covered the most popular options below:

·         Paying the cost upfront

It tends to be the more difficult option, but some people would rather save up their cash over a lengthy period of time and use it to make an upfront motorbike purchase. There are pros and cons to doing this – you’ll relieve yourself of the task of repaying a loan once you own the bike, but saving up the cash is going to take time. You ultimately need to decide whether you have the patience to wait a few years until you’ve saved up enough money to purchase your bike.

·         Taking out a personal loan

A personal loan is a type of loan that’s offered by a financial institution like a bank or credit union. Generally, personal loans are unsecured, so you don’t need to worry about losing your bike if you’re unable to make payments. You can always choose to take out a personal loan to pay for your motorcycle, but it’s not the most popular loan option. The loan will cover the initial cost of your bike, and you’ll have the flexibility to pay the loan off over an agreed-upon period of time into the future. Visit LetMeBank for more information on personal loans.

·         Taking out an auto loan

Unlike a personal loan, which is broader, an auto loan is for vehicle purchases only. Auto loans are designed to help you finance your car or motorbike to make the purchase as affordable as possible. Generally, you can expect auto loans to have lower interest rates than personal loans, and you’ll have more flexibility with your repayment period. You might also be able to borrow larger amounts with an auto loan – but bear in mind that the loan is usually secured, meaning you’re at risk of losing your bike if you fail to make payments.

·         Buying on finance at a dealership

If you’re buying a bike from a dealer, chances are, they’ll offer you a financing option. This may well be the best deal you can find, in which case, it’s worth considering. However, be aware that your dealer may have more limited financing options to offer you, so don’t jump to say yes before you know exactly what else there is available. Dealership financing usually works in the same way as an auto loan would, covering the initial price of your bike provided you pay off monthly instalments with added interest. Find a dealer with a good reputation and positive ratings for financing you can trust.