Nothing embodies the feeling of freedom better than motorcycling. But the purchase of a motorcycle is also associated with considerable costs. We will show you what options there are to finance your dream of riding a motorcycle and what things you should pay attention to.
How much does a motorcycle cost?
Before you buy a motorcycle and the associated price request, you should consider what type of motorized two-wheeler you prefer. In addition to the question of whether a tourer, athlete, cross or chopper variant, the following two questions are particularly important for price determination:
- Should it be a brand new model?
- Are you satisfied with the purchase of a used motorcycle?
While used motorcycles can be had for around 5000 USD, depending on their age, mileage and condition, the purchase of a brand new machine can sometimes cost 10,000 USD, sometimes up to 20,000 USD. There are also no upper limits for the two-wheeler.
How can you finance a motorcycle?
If you are looking for your new dream on two wheels, it is time to buy the two-wheeler. You should have answered the following questions yourself before deciding on a particular model:
- What is your monthly budget that can be used for the monthly loan installment?
- What savings can be used as a deposit for the new motorcycle?
- How long do you want to use the motorcycle? The term of the loan should not exceed the planned useful life. Otherwise, you have to sell the bike with a current loan. In this context, pay attention to a possible prepayment penalty.
Once you have clarified these points for yourself, there are basically three options for financing the new vehicle.
Financing with constant monthly installments
The installment loan for a motorcycle works like any classic consumer loan. You determine the amount of the loan and the term, and pay the loan, including interest, back to the bank in constant monthly installments.
|The constant monthly rate gives you planning security over the entire term.||The risk of losing value when reselling is yours.|
|With the payment of the last credit installment, the motorcycle is entirely yours.||Without a down payment or a final installment, there are high monthly charges.|
|You can adjust the term and thus the monthly charge to your individual needs.|
|With a down payment from your own savings, the monthly rate can be reduced.|
In contrast to the classic installment loan, balloon financing does not pay off the entire loan amount in monthly installments. Part of the outstanding loan amount must be repaid as a one-off payment at the end of the term.
|Due to the high final rate, the monthly charges decrease.||At the end of the total term, part of the loan is still open.|
|In many cases, the closing rate is less than the vehicle’s resale value.||The motorcycle only becomes your property after the final installment has been settled.|
|The final installment can be converted into monthly installments with follow-up financing.|
Funding through the three-way model
The so-called three-way financing is similar to balloon financing, but a down payment is made at the beginning. In this way, the monthly repayment rate and the closing rate can also be reduced.
|The monthly rates are the lowest when comparing the three options.||A larger sum has to be raised at the beginning and end of the financing.|
|Thanks to the down payment, a lower final rate is waiting at the end of the term.||The total costs of this variant are often the highest.|
Take out a loan or finance it directly from the dealer?
In almost every motorcycle shop you will find offers for financing the models offered. You benefit above all from:
- Less personal effort when applying for financing, since the dealer takes care of all the formalities.
- The possibility of zero percent financing when the dealer offers it.
However, there are also some disadvantages associated with financing through a dealer:
- The dealer is only an intermediary between you and the bank. You are therefore bound by the conditions of the bank cooperating with the dealer.
- Discounts are rarely made possible when buying in installments through financing.
- Even with zero percent financing, the resulting costs are factored in elsewhere.
You have considerably more freedom in choosing a financing partner if you take out a loan in advance beforehand. This has the following advantages in particular:
- You can choose the provider with the best conditions yourself.
- When you buy the motorcycle, you appear as a cash payer, which usually allows higher discounts.
- You can also buy your new motorcycle from providers who do not offer financing themselves.
To take advantage of these benefits, all you have to do is apply for the loan yourself in advance. Our loan comparison from the loan expert will help you to find the right offer. Other vehicles, such as a quad, can also be financed in this way.
What are the points to consider?
No matter whether you want to take out a loan for a motorcycle, a new or used car or other things like dentures, holidays, a new kitchen or furniture. The following points should always be observed:
- The loan amount taken out must be able to cover all costs incurred. As a beginner, also consider the cost of purchasing necessary protective clothing when riding a motorcycle.
- The monthly repayment rate must be easy to finance.
- The term of the loan should be appropriately structured.
- The possibility of special repayments gives you more flexibility when paying off the loan.
- The application for the loan should be easy, if possible completely online and digital.
Due to the current low interest rate phase, a loan for motorcycle financing is currently particularly suitable. That could change if market interest rates rise again.
Our conclusion on motorcycle credit
The dream of freedom on the road in the form of motorcycling comes at a price. In terms of maintenance, a motorcycle is often cheaper than a car, but with the purchase costs of a new machine, you can quickly find yourself in the area of a well-equipped small car. Financing through a loan is therefore the ideal way to expand your own financial scope. So motorcycling no longer has to be a dream.