So you need a new bike and you are exploring your options for your dirt bike financing. This article reviews the things you need to consider first and how best to go about getting a loan for your dirt bike financing.
There are a few things to think about before signing on the dotted line if you’re seeking for motorbike or dirt bike financing. It is worthwhile to investigate the various financing choices available, as there are numerous. And they aren’t always as black and white as they appear at first. If you don’t read, comprehend, and question the fine print, you may find yourself paying considerably more interest than you anticipated, dulling the luster of your fresh new dirt bike.
How Dirt Bike Financing Works
This is how it works if you’ve never applied for a loan (or dirt bike financing) before. Lenders will decide whether or not to lend you money based on your credit history and ability to repay the loan. Your credit score is determined by whether you owe people/creditors money from previous transactions and how successfully you have paid off other obligations in the past. The better your credit score and the more money you make, the more likely you are to get approved for a low-interest loan. Read our review of self credit builder here.
The worse your credit score and the less money you make, the less likely you are to qualify for a loan, and if you do, you’ll pay higher interest rates because you’re a security risk. Talk about kicking you in the shins while you’re down! If you are looking to finance a car you may read our review of Car Dealerships That Work With Bad Credit.
Finance Companies and Banks (Personal Loans)
Secured Loans: This is when you use an asset of yours as collateral for a loan (for example, your new dirt bike). These loans are usually available for roughly 14.95 percent interest.
Unsecured Loans: Because they provide a greater risk to lending institutions, they usually come with a higher interest rate. Typical loan rates are roughly 17.95 percent. If you have a mortgage, you may be able to refinance it with the same lender at a lower interest rate.
Credit Cards to Use for Dirt Bike Financing
Using a low-interest credit card can help you get your hands on the bike of your dreams far sooner than you might otherwise be able to. If you qualify, interest rates as low as 12.5 percent are possible. Just make sure you’re informed of any account fees to avoid any unpleasant surprises later on.
Motorcycle Dealership & OEM Financing
Most motorcycle shops and manufacturers, such as Honda, Yamaha, Suzuki, and Kawasaki, now offer financing for their brand new dirt bikes through private label credit cards. Interest rates vary, although they are often higher (than personal loans) over the loan’s term. Keep an eye out for extremely low-interest offers, as well as occasionally interest-free packages. This is a service that some dealerships provide to help move old or slow-moving inventory.
If you’re thinking of taking out one of these loans, read the fine print! Don’t be scared to read it, analyze it, and ask questions. If you’re not attentive, your interest rate could skyrocket once the promotional time has over.
Bad Credit Loans
If you have bad credit and can’t get dirt bike financing, look for organizations that specialize in bad credit lending. If it doesn’t work, you’ll have to focus on boosting your credit score. This does not imply that you must pay off all of your debts at once. It could simply be a matter of making timely payments on your existing debt. If you’ve been turned down by a few lenders, keep looking, but be prepared to pay a higher interest rate if you’re accepted.
Communicate with the lenders that have turned you down and inquire as to why you were turned down. You may be able to defend why you got into trouble with payments in the past, but you can now show them that it won’t happen again (ex. you may have been made redundant but now have a secure job). Check what past creditors have filed against you – they’ve been known to make mistakes that have a big impact on credit ratings and can mean the difference between getting a loan or not.
Loan Repayment Insurance & Protection Plans
These can provide you with peace of mind if something happens to your ability to repay the loan. Depending on the arrangement, it may cover some or all of your payments if you lose your job or become too unwell to work. Of course, this will increase your repayments, so you must decide whether it is worthwhile for you.
To sum it up, arming yourself with the above knowledge of the many types of dirt bike financing and taking the time to find out which one is right for you can possibly save you a lot of money. Or it could simply assist you in finding someone who will approve your funding when no one else will, allowing you to avoid being without a bike for the next 6–12 months.