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Top five tips on motorcycle loans

Heavy Duty Motorcycles motorcycle loan

There’s plenty to think about when choosing a motorcycle loan, so we asked finance expert Kevin Bolton* for his advice to make sure you get the best loan for your individual circumstances.

Five Key Factors to Consider When Shopping for a Motorcycle Loan:

1. Interest Rates

Rates are the main yardstick that people use when comparing loans. I prefer to think of them as being like a headline in a newspaper. They grab your attention but don’t necessarily tell you the entire story. The interest rate is going to play a big part in determining the cost of your loan so it’s a good place to start but don’t fall into the trap of thinking that the rate is the only element to consider.

2. Fees

Fees are another factor that will directly impact on your cost of borrowing. They’re not displayed as prominently as interest rates but you need to find out what fees apply and how much they are before proceeding with a loan. Beware of being lured in by attractive headline rates only to find out that the deal involves high set-up and ongoing account keeping fees.

3. Loan Security

Most loans involve the lender using the motorcycle that you buy as security. In other words, the bank or finance company have some rights over the motorcycle which could potentially allow them to repossess it if you were to break your agreement and miss your loan repayments. When it comes to selling or trading in your motorcycle a secured type loan needs to be paid off in full before the sale can be finalised. If you want the flexibility of an unsecured loan expect to pay a higher rate for the privilege.

New York motorcycles

4. Loan Inclusions

Make sure to check that the loan will cover everything that you want it to. Most Banks and Finance Companies will limit how much they lend against the value of the motorcycle. So if you’re planning on including apparel and accessories or maybe the cost of an extended warranty in the loan, check out whether the lender will be prepared to include this for you. Otherwise you could be left with an unexpected bill to pay!

5. Early Termination

If you think that you may want to occasionally pay extra off your loan or if you’re planning to pay the loan off early with a lump sum, make sure to check beforehand that your loan allows you to do this. If your loan does provide this flexibility check out if there are there any costs associated with it.

  • Kevin Bolton has worked in personal and business finance for nearly 20 years in Australia and the UK.  His expertise is in lending with a particular focus on the automotive sector.  He has recently developed a customer-focussed website, It provides users with independent information and insider tips, helping them to learn about how financing works and how to find the best loan deals for their individual circumstances.
  1. Good succinct article on a issue that will impact many riders.

    In my experience, credit unions have been great to deal with for getting a loan, especially with competitive rates and lower fees than a big bank. Some even let you use a seven year term with no penalties for early pay-offs. Marvellous and most importantly flexible.

    Your author forgot to mention that while getting a finance deal at a bike shop can be easier, you need to look real close at the details as it is probably not as flexible as a credit union/bank. I had a recent bad experience with a Harley dealer that offered a great rate but the fees were not really competitive and the ‘savings’ were incorporated back into the price of the new bike i.e they offered me a ‘good’ finance option but the overall price of the bike ride-away went up.

    Not cool, therefore I took my finance and bike buying business elsewhere.

  2. I’ve been wanting to get a motorcycle for a long time, but I was a little concerned about the financial process involved. I really appreciate you going over the details of a loan and what to make sure of when you choose to take one out. Thank you for such a helpful and informative article about this specific type of loan!

  3. I thought it was a good tip to really understand the interest rate you will be getting, because there is so much more to consider in a loan. Checking out the fees, and asking a lot of questions, so you know what you’re getting into is another thing this brought up that I liked. I think it would be cool to get motorcycle, but it’s just something I’m going to have to wait for, for a while.

  4. One thing that got me last weekend:

    That warranty that the bike dealer implies is included in the price is most likely not!

    Ended up paying an extra thousand dollars for a warranty on a 4 thousand dollar bike and by the time I realized it, it was too late

  5. I’ve been looking for a good Harley Davidson financing option, and I think that being able to get some tips would be good. I’m glad you talked about looking at the fees, and I think that would be smart. I’m hoping that I can get the good Harley Davidson financing options that I need to help me get a bike!

  6. I’ve found that Harley does a good job from a past loan. Paid it off early no extra fees or hassles and an excellent rate.

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