Get a Motorcycle Loan the Right Way

By: Devora Witts

When financing the purchase of a motorcycle, there are many things that have to be taken into account in order to avoid overpaying. You should take as much time when shopping for a motorcycle loan as you probably took when selecting the motorcycle you are going to buy. Thousands of dollars can be saved by being cautious when choosing a loan and lender.

You can never be careful enough when searching for the right lender for your motorcycle loan. There are many lenders that abuse applicants charging high interest rates or concealing fees and costs within the fine print of the motorcycle loan contract. If you can not get experienced aid from a friend or family member, stick to the following advice and you will do fine.

Dealers Should Not Lend

Beware of salesmen who come with extraordinary offers for financing the motorcycle of your dreams, they will state that there are many benefits obtained by financing with the same company with which you purchase the vehicle but truth is that you will not get a better deal and if something happens and you need to make a claim you will learn that it was not the same company after all.

The interest rate charged by financing with a dealership is considerably higher than the interest rate charged by traditional lenders and a lot higher than other alternative lenders not so widely available that have special offers for motorcycle loans. Besides, with dealerships, the terms of the loan contract always hide extra fees that are not included in advertisements like insurance fees, administrative fees, closing costs, etc.

Low Rates Only For Short Terms

You need also to be careful with certain loan offers that provide a low interest rate but only for a small period. If after the promotional period has ended the interest rate rises and you can not afford the monthly payments you'd have been better off with a regular loan with a moderate interest rate fixed for the entire loan's life.

Moreover, these loans usually require the installments to be charged to a credit card. Thus, the installments may accumulate in your credit card generating not only interests but also penalty fees and other costs and sometimes, under certain circumstances, blocking your ability to use your credit card for making other purchases.

Think Ahead

The first thing you need to decide is how much money are you willing to spend on your motorcycle. Moreover, you should not start shopping for a motorcycle till you are completely sure that you will be approved for that amount. Otherwise you may waste your time selecting an expensive motorcycle worth more than you will be able to afford. You will not only be disappointed, but you might as well loose money in the process.

There are many online lenders dealing with motorcycle loans that will be able to offer you loan quotes so you can compare rates and loan amounts with the different motorcycle prices and select the loan that best suits your needs. Only after securing your loan should you start shopping for a motorcycle and try to get the lowest price on your bike as you got on your motorcycle loan.

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