Lenders offer a variety of motorcycle financing rates to borrowers looking to purchase their next motorcycle. Interest rates will change greatly depending on a borrowers credit history, down payment and loan term.
Motorcycle interest rates will be higher for borrowers with bad credit. Lenders believe that consumers with a poor credit history are a higher risk. To offset their lending risk, borrowers will increase their interest rates. In contrast, borrowers with good to excellent credit typically get attractive interest rates due to their previous credit relationships with other lenders.
Borrowers should accurately assess their credit report to determine their potential loan risk. Having an understanding upfront will make getting approved for motorcycle loans much easier.
Where to Find the Best Motorcycle Financing Rates
Lenders will usually offer a range of interest rates on motorcycle loans to potential borrowers. There are many factors that banks use to calculate the potential interest rates. Among these are credit history, loan amount and other external economic factors. For instance, interest rates on personal loans greatly increased during the most recent credit crunch in the United States.
Financing rates will vary greatly. Borrowers are advised to shop around for the best motorcycle financing rates before applying for a motorcycle loan.
Motorcycle Financing is available from many sources:
- Motorcycle Dealerships
- Peer to Peer Lending Sites
- Banks or Credit Unions
Fixed or Variable Motorcycle Financing Rates
Today motorcycle loans are more commonly offered with a fixed interest rate. Borrowers can repay their loan with the confidence that their monthly payment will not change over the course of the loan.
Some consumers however prefer the benefits of variable interest rates. For borrowers that have flexibility in their monthly budget a variable interest rate motorcycle loan will allow them to take advantage of low interest rates. In the event interest rates rise, the interest rate will increase as well.
This variable rate financing strategy got many homeowners in trouble when their monthly mortgage payments became unmanageable. Borrowers looking for small motorcycle loans may be able to use the benefits of variable interest rates in ways that homeowners cannot.
Bad Credit Motorcycle Financing Rates
Motorcycle riding is a fun and affordable hobby for many enthusiasts. The enjoyment of the outdoors and the open road should not be missed by anyone just because they have bad credit. There are many lenders that specialize in bad credit motorcycle loans. Typically these loans have higher interest rates.
Using a motorcycle loan calculator can help borrowers determine if a high interest rate loan is affordable. When motorcycle loan rates are higher than normal borrowers may consider extending their repayment period. A longer loan term will mean that more interest is paid over the life of the loan. This can be worth the extra cost if no other financing options are available.
Since there are many factors that affect motorcycle financing rates borrowers should be constantly checking interest rates before applying for a loan. Using some research and common sense will go a long way to finding the best motorcycle financing rates currently available on the market.