Can I get a personal loan for a dirt bike?
Lenders provide personal loans for almost every endeavour, and buying a dirt bike is no exception. There are many ways of financing a new dirt bike, and some may work better for you than others. For this reason, it is important that you consider your options carefully, shop around, and pick the plan that works best for you. Because no one wants to end up paying more than they have to.
Where can I get dirt bike finance?
Dirt bike finance is available from a variety of different avenues, and for a variety of different interest rates. Your approval for finance will rely on your credit history and income, and the rate you will be charged will also vary depending on these factors.
Dirt bike financing options include:
Secured personal loans: These are loans that have a security attached to them. In the case of purchasing a dirt bike, you may choose to use your dirt bike as security on the loan. This means that if you default on your repayments, a lender can claim your bike in order to cover the cost of the loan. Only once you’ve paid off the loan, do you get full ownership of the bike.
Unsecured personal loans: The hint is in the name, and unsecured loans are just that: not secured against an asset. As a result of this, they tend to have a higher interest rate than secured personal loans, because they are considered by the lender as a higher risk product. An unsecured loan may be useful if you are considering a second-hand bike, as lenders may be less inclined to consider second-hand bikes for security.
Credit card: You may find that you prefer the option of purchasing your bike on a credit card. Using a credit card can mean that you’re able to get your bike and get going faster than perhaps with other financing options. You may be able to find a low rate credit card that suits these purposes. But bear in mind that there can be some high balance transfer fees attached to low rate credit cards, should you want to find a card further down the road with a lower interest rate. Credit cards can be notorious debt traps.
Fixed rate bike loan: Bike loans with fixed rates based on the period of the loan are available from some lenders. The rate will vary by lender and depending on your circumstances.
No deposit bike loan: You can also get bike loans that are deposit free, so you don’t even have to have any cash saved up in order to purchase your new ride. Beware though, a no deposit bike loan may mean higher monthly repayments, and/or a longer repayment period, which means you could end up paying more interest over the life of the loan.
Motorcycle dealership finance: Many motorcycle dealerships will have their own financing structures in place for their automobiles. Some of these will even offer a zero per cent finance deal. However, be wary of likely paying a full retail non-negotiable price for your bike in this instance. Know that financiers are always making their money somewhere, so if they’re offering you a zero per cent interest finance option, there’s probably a catch.
Ways to pay less when buying a dirt bike
- Do you have an older model and want to replace it with something new? You may be able to save on the cost of your bike by trading in your previous bike. You may also be offered a more flexible loan with a trade in, with options of balloon payments, etc.
- Shop around. It is important to compare loans and do your research in order to find the best deal for your circumstances.
- Having a good or an excellent credit rating will mean that the lower rates are often available to you and will save you money over the life of the loan. If your credit isn’t excellent, or you have bad credit, there are ways in which to help improve your credit rating.