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5 savvy tips to secure your motorbike finance in 2016

5 savvy tips to secure your motorbike finance in 2016

When it comes to riding, most of us are preoccupied with getting out on to the road.

Before you can commit your rubber to bitumen, you’ll need to finance your new (or used!) bike.

Thanks to Savvy Motorbike Finance (recognised by BRW as one of the fastest growing car finance companies in Australia in 2015), here are five tips to make sure you get motorbike finance and find a great deal to boot!

  1. Budget well

There’s no worse feeling than having your heart set on something … and not being able to afford it! You should set a realistic budget for your bike and stick to it. This needs to factor in:

  • Monthly or regular repayments
  • Fuel costs
  • Maintenance and servicing
  • Insurance

You can get a better idea of this by using a motorbike loan calculator – though you’ll have to do the maths around fuel and other particulars yourself. This gives you a starting point for finding a bike that suits your needs and is within a price range.

  1. Check your credit history

Even if you might suspect your credit history might not be all it’s cracked up to be, you should run a check on it before you start applying for motorbike loans. Credit histories influence what kind of interest rate you might get from lenders, so it pays to figure out if there’s anything that might hold you back. Sometimes, there might be mistakes on your history (telcos and utilities love to slap people with defaults, even if they’ve cleared up any debts) that is your responsibility to fix.

  1. Use a motorbike loan broker

Our CEO Bill Tsouvalas always says “do your homework” when it comes to finance, but why not get a whole company to do it for you? Just like a home loan or car loan broker, a motorbike loan broker helps you find the best deal on motorcycle loans. Many lenders and banks link up to a broker, and your broker have one goal in mind – to find the best, lowest-cost deal that suits your needs.

  1. Gather as much financial information as you can

Getting a quote is great – but don’t jump the gun too early. Don’t let any lender or broker run a credit check on you before you can demonstrate you have good financial standing. This may come in the form of recent payslips, a recommendation letter from a boss or authority figure, bank statements or even a solid residential history. All this lowers your risk profile, which means better interest rates for you.

  1. Try to buy newer bikes

This might seem a bit counter-intuitive, but buying newer will actually cost you less. Why? Because a few things cancel out the initial outlay:

  • Newer bikes mean lower risks, so lenders are prepared to offer lower interest rates
  • New bikes require less maintenance and servicing
  • New bikes are generally more fuel efficient and have better safety features

Of course, insurance might cost a bit more, but you are still bound to save a lot of money on your motorbike loan. What’s more, if you decide to upgrade after a couple of years, your bike still has a lot of residual value. Older bikes are harder to sell as time goes by.

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  1. Truth really is the broker is after the best deal for him/her. They earn commission on how much rate they write over their base rate, and on their ‘brokerage fee’ and on the insurances like loan protection that they put in to the loan – these insurances are an option not mandatory (only comprehensive is mandatory for a secured loan and you can get that yourself by shopping around) so get them removed as you most likely don’t need them. It’s actually illegal for them to put these insurance in your loan without selling them to you first. If someone does that, report them to ASIC as they can be black banned if caught out. Oh and boy do they get caught out. Finance means paperwork trail, which means evidence. Just ask BMW Finance at present and the fines they have just received.

    So yes they may have access to great lenders who happily finance motorcycles, but you then can screw the broker down getting him/her to provide a better rate than quoted, remove any of their fees/charges as they are still getting an income from the lender and removing any insurances you don’t need. There are massive profits in loan protection products so they will really push them.

    Also, try your dealer’s in house finance staff member to compare, or other brokerage firms to that have an office. Often you can do the same as above but face-to-face where you can really put the pressure on. They have access to lenders and insurers just like your brokers do, but not over the phone helps you get a great deal at the desk. Then you have a go-to person who you’ve met, just like the bank manager days, to discuss your finance deal and maybe use them for your next bike purchase!

    I’ve been on both sides of this, so please take my advice and shop around. It’s painful, but can save you a lot of money over the term of the loan and the overall bike purchase. Then more money for fun stuff like trips away or riding gear!!

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