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Motorcycle Financing Options For Bike Loans
By EchoBay Loans Staff Writer

It's the thing that many people dream about and a few people actually get to experience - purchasing your very own motorcycle. If you've finally decided to turn that dream into a reality, you're going to need to think about financing. It's important to remember that a motorcycle is a luxury item and not a necessity of life, and as such lenders view motorcycle financing a bit differently than they view the average automobile loan.

While there are motorcycle loans to be had, which motorcycle loan is right for you will depend on a number of factors including your credit, whether you're purchasing a new or used motorcycle, and who you are purchasing your motorcycle from.

If your credit is in decent shape and you're purchasing a new motorcycle, you're going to want to look into obtaining your motorcycle financing through the manufacturer.
Companies like Honda, Harley Davidson, Suzuki and Kawasaki all offer motorcycle financing on new motorcycle purchases. You can usually apply for these loans right at the dealership and approval time is minimal, however interest rates are normally quite high. Many times these loans offer revolving lines of credit, working in the same way that credit cards do. In some cases, fixed-rate installment loans are also available.

If you don't qualify for manufacturer financing or if you're not happy with the current terms being offered by the manufacturer of the bike you're purchasing, the dealer you're working with may still be able to help you obtain a motorcycle loan for the bike of your dreams. Just like automobile dealers work with various finance companies to help buyers obtain automobile financing, motorcycle dealerships have financing arrangements in place with institutions that provide motorcycle loans.

If you're looking for a one-stop purchasing solution, this may be your best bet. Just remember, when you're arranging you're financing through a dealer, it is likely that you're going to have to purchase a full-coverage insurance policy. While this can be costly, it is not necessarily a bad thing. Many consumers prefer to have their bikes covered by a full-coverage policy until the loan is paid off. Some even keep full coverage well after their motorcycles have been paid for.

If you're not purchasing your motorcycle from a dealer, the above two financing options probably aren't going to work for you. Don't worry; your dream of owning a motorcycle isn't over. There are other motorcycle financing options available that may suit you perfectly. If you have good credit, you may want to go with a traditional loan for your motorcycle financing needs.

In fact, getting your motorcycle loan through an online lender, a bank or your local credit union may save you money in the long run. While the interest rates on motorcycle loans offered by manufacturers and dealers tend to be quite a bit higher than your average car loan, loans obtained through online lenders, banks and credit unions are usually only a couple of points higher than regular car loan interest rates.

If you're a home owner and none of the above motorcycle loan options fit your needs, you might want to look into using the equity in your home to purchase your motorcycle. Many consumers who have their heart set on owning a bike will put anything on the line to own one, including their homes. While this is indeed a very effective way to get a low-interest loan to finance your bike, it's also a risky endeavor. If for some reason you can't make the payments on your loan, your motorcycle won't get repossessed, your home will.

If using your home as collateral to finance your motorcycle is a little over the top for you, you may want to look into using a low-interest credit card. If your credit limit can accommodate your motorcycle purchase and you've been graced with a low-interest introductory period, you may want to use plastic to finance your motorcycle loan. Just make sure that you make high enough payment amounts so that your bike will be paid off before your low introductory interest rate expires and a higher interest rate kicks in.

If you're purchasing your motorcycle from a private party, you may want to inquire as to whether or not the seller would be interested in carrying the loan for you. If the seller has been having a hard time selling his bike, and you offer to pay full price for it with the condition that they'll let you make monthly payments instead of paying it all at once, you might be able to work out a deal. Just make sure that you take out a full-coverage insurance policy on the bike in case something were to happen to it before the total loan amount was paid off.

If worse comes to worse and you have no other way to arrange financing for your dream motorcycle, you may want to get your motorcycle loan from family or friends. If you're lucky, they'll be sympathetic towards your burning desire to own a bike, and may be willing to help finance the cause. If your family and friends don't have the cash on hand to help, they may be willing to co-sign. Just make sure that you can meet the obligations of the financing arrangement, because it won't be just your credit on the line, it will be the co-signer's credit as well.

Regardless of which motorcycle financing option you choose, just make sure you can meet the monthly payment requirements and be sure that you understand all of the terms and conditions involved with your motorcycle loan. Once you've picked out the right bike and have arranged for the financing that's best for you, you'll be ready to hit the open road.

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