There is a lot of talk at the moment about interest rates. Some may think it is a particular obsession in Australia. Primarily that focus comes from the home loan sector. With mortgage payments a major cost for home buyers, getting the lowest interest rate possible is key. Many adverts and commentary talk about locking-in a rate for home loans. So does the same think apply to motorcycle loans? Should buyers look to locking-in a low interest rate motorbike loan and if so how?
As specialists in motorbike finance, Jade Bike Loans outlines the reasons why and the processes for how motorcycle buyers can go about locking-in a low interest rate motorbike loan now for their motorbike purchase. Interest charges are key to the overall cost of a bike loan. The rate at which the interest is charged is therefore paramount to how much that motorcycle is actually going to cost in total when accounting for the loan. So achieving the lowest interest rate possible is the objective.
Current Interest Rate Scenario
Most Australians, especially those who have sought any type of finance or held a savings account over the past few years, are well aware that interest rates are currently very low. In fact, the official cash rate is at a historic low level.
This has occurred as a result of the RBA implementing monetary policy decisions to counter the effects of the pandemic on the Australian economy. The cash rate was cut on a number of occasions in 2020 and has been at its current 0.1% level since November 2020. This is the lowest level ever for Australia.
How long will that rate last? While not the interest rate that lenders offer for loans, the cash rate does in part determine the interest rate on a wide range of loans including motorbike loans. The RBA has consistently stated that it will be patient and will wait until key economic figures of inflation and unemployment have been achieved before considering a rate rise. Their expected timeframe is 2024. But many commentators see the heated home market and the economy bouncing back ahead of expectations as reasons for a rate rise sooner.
One thing is for certain, the cash rate will rise soon. While the talk of 2024 seemed a long way off in 2020, we’re now in 2022 and a rate rise is looming! Those planning to buy a motorbike with finance could do well to act to ensure they enjoy the current low rate situation.
Interest Rates for Bike Loan
When buying a motorbike with finance, most purchasers will want some certainty that their loan repayments won’t be constantly changing or preferably won’t change at all over the years they are repaying the loan. Those looking to take advantage of the current low rates will also be wanting to lock-in that low rate for the full loan term.
That involves paying close attention to how the interest rate is set on loans for motorbikes by different lenders. Loans for consumer goods including motorbikes can be at a fixed interest rate or a variable interest rate.
When browsing the different loans on offer by banks and lenders, keep an eye on that issue. A variable rate means the rate charged on the loan may go up or down, depending on what happens with that lender’s rates or the general rate scenario.
A fixed interest rate in regard to our motorbike loans and most consumer goods loans, means that the interest rate will remain constant and unchanged over the term of the loan.
Our Secured Bike Loan is offered at a fixed interest rate and this is the most widely used type of loan for new motorcycles and a many used bikes. However, some other lenders may offer Secured Loans at a variable interest rate.
Where the lender doesn’t accept the bike as loan security, buyers can consider an Unsecured Personal Loan. Unsecured Loans may be offered at a fixed or a variable interest rate.
With the current low interest rate lending market, clearly it is preferable for motorbike buyers to seek to secure a bike loan with a fixed interest rate.
Ways to Lock-it in Low
So how do you go about locking-in the lowest interest rate on a motorbike loan?
- Ensure the type of loan has a fixed interest rate so the rate and hence the repayments won’t change over time.
- Ensure the interest rate offered is the lowest available across the market. Using the services of Jade Bike Loans allows buyers to have many banks and lenders covered quickly and easily.
- Ensure your credit rating and profile are good. This will be assessed by lenders and a better interest rate and loan conditions can be achieved with a better credit rating.
Refer to our Lender Interest Rate comparison calculator to see what different lenders are currently offering for motorbike loans or speak with us to source a quote for your bike loan.
To lock-in a low interest rate motorbike loan contact Jade Bike Loans at 1300 000 003
DISCLAIMER: IN REGARD TO ANY ERRORS OR MISREPRESENTATIONS IN THIS MATERIAL, NO LIABILITY IS ACCEPTED. THE DETAILS, CONTENT AND DATA ARE PRESENTED PURELY FOR GENERAL INFORMATIONAL PURPOSES FOR MOTORBIKE BUYERS AND THOSE SEEKING MOTORCYCLE LOANS. THIS IS NOT INTENDED AS THE SOLE SOURCE OF INFORMATION FOR FINANCIAL DECISIONS. IF SPECIFIC ADVICE IS REQUIRED AROUND FINANCIAL DECISIONS, READERS SHOULD SEEK THEIR OWN FINANCIAL ADVISOR.
