Motorbikes have considerable glamour and mystery surrounding them, due in part to the classic American film Easy Rider with its iconic Harley-Davidson chopper bikes. Motorbikes conjure up the freedom of endless roads and wide-open spaces, things that Australia has no shortage of. As with any type of vehicle, you can get relatively inexpensive bikes or go to the top of the range where you could spend many thousands of dollars, even over $30,000 to get the bike you want. If you can't afford all the money up front, motorbike finance could be the solution.
How does motorbike finance work?
When you need money to finance buying your motorbike you will be entering into a loan agreement with a bank or other financial organisation. Motorbike finance is a type of personal loan where you borrow money, just as you would for a car, a caravan or other large value item. You will generally be offered a fixed rate of interest to pay on top of the principal sum you are being loaned, and you can decide over how many years you want to pay it back. Normally there is a maximum time period of 60 months for this type of loan. If you choose to repay more quickly, you'll be saving on interest payments.
Why do people use motorbike finance?
Getting help to finance your motorbike means the opportunity to own your bike more quickly than if you had to save up for it. Even bikes at the cheaper end of the market may cost several thousand dollars, so as often as not, you'll need that extra help to buy one. If you currently have a bike you can trade in, you can reduce the amount you have to borrow, and if you have some savings to put towards it as well, you can save money on the amount of interest to be repaid.
What are the main features?
As a type of personal loan, the majority of institutions in the financial sector provide motorbike finance options. If you are looking for a short-term loan, you should always check out the interest rates being offered by a variety of lenders. Rates do vary and can be higher than if you took out a loan over a longer period. However, even though that could help your cash flow in terms of smaller repayments, you could end up paying much more in interest than with a shorter loan. Make comparisons between lenders that will suit your circumstances.
What are the pros and cons of motorbike finance?
When you enter into a personal loan for motorbike finance, you should always check what your overall cost would be and if there are any hidden fees, such as for applying, overpaying and early repayment. A loan will give you the freedom to buy the motorbike you want without having to wait. You need to ensure you can afford the monthly repayments without them becoming a financial headache. If you fail to repay instalments on time or default completely, then you are likely to lose your bike.