Buying a motorcycle is fun, enjoyable and definitely a process to look forward to with excitement. Test riding the latest makes and models, talking bikes with dealers and colleagues and pouring over brochures and websites for all the latest info. But most will require a motorbike loan to purchase their ride and getting a motorbike loan can be a lot less than fun and excitement for many buyers. To simplify the process, we provide our expert tips and information to easily compare motorbike loans and where to get the cheapest loan deals.
When embarking on the process to compare motorbike loans, buyers will want to be up to speed on the lender market, types of loans available and which best suits them, the interest rate scene and how they can cut to the chase to get that cheap loan quickly and easily.
Motorcycle Loan Market
Essentially and in general terms, the loan market is made up of the traditional banking sector, finance companies which are non-bank lenders, finance available through dealerships and finance brokers like Jade Bike Loans. Some lenders specialise in particular areas while others are more general and offer loans for all types of purposes.
- Banks have traditionally been the major lenders for just about all types of loans. But due to their status as banking institutions, they must operate to strict guidelines. In regards to motorcycle loans, most major banks will have this covered under their generic Secured Personal Loan category.
- Finance companies are by definition non-bank lenders as they don’t hold banking licences under Australian law. But many of the larger ones are so large that they still have quite strict lending conditions to follow according to their corporate structure.
- Finance through new bike dealers is often associated with the finance part of their manufacturer of the bike. These deals are offered widely and can appear on the surface to be convenient. But smart riders will know to check out what else is available as cheaper interest rate loans can be on offer.
- Finance brokers including Jade Bike Loans provide many benefits to buyers through their accreditation with many lenders and through their comprehensive, expert loan services. They can easily and very quickly assess the bike loan market to source the cheapest offer that meets individual application specifics.
Swat up on Interest Rates
Interest rates are always in the news but if you’re not in the market to borrow, then it may be 'white noise' in your world. Before applying for a motorbike loan it could be worth getting across at least the basics. Interest forms the greatest cost component of a loan and as such, knowing how and where to get the lowest rate should be a priority.
The official cash rate forms the basis that lenders then build in their own costs and set the rates they will offer on different loans. The RBA establish the official rate. Lenders also build in their interest in operating in certain markets. So sourcing a lender that specialises in motorcycle loans can be key to achieving a lower rate.
The interest rate offered is also determined by a risk assessment by the lender of individual applicants. That relates to the credit rating or score. Prior to making an application, bike buyers can check their credit profile.
Interest rates on loans can be at either a fixed rate or at a variable rate. Fixed is the more common way with secured consumer loans. It means the rate stays the same over the loan term.
Consumer loan advertisements will also display a Comparison Rate, a requirement under Australian Consumer laws. This is the interest rate on a specific motorbike loan after the loan fees and charges are included. It can provide an indication of whether or not higher charges are applied by a particular lender.
Business finance interest rates are always lower than for consumer loans. Ensure you are reviewing the correct rate for your bike purchase. Business rates only apply to motorcycles being purchased for use in a business and by a business entity or ABN holder.
Know the Difference between Secured and Unsecured Loans
Different types of loans are available for business versus personal motorbike buyers. As most motorcycle purchases are for private use, we’ll focus on consumer loans.
There are two main types of loans: Secured and Unsecured.
- Secured Motorbike Loan is the most commonly used and will be suitable for the majority of buyers. The bike becomes the security for the lender. The repayments are typically in equal monthly amounts over a fixed term and the loan is priced at a fixed interest rate.
- For some used bikes, resto projects and in other circumstances where the bike is not suited as security, an Unsecured Personal Loan may be applied for. These may be at fixed or variable interest rates and differ in features to secured loans.
No Deposit Loans are widely promoted these days but are not a specific category of loan. These are simply loans where the entire bike price is included in the bike loan. Buyers may still have to pay a holding deposit to the dealer before the lender settles the transaction.
Pre-approved bike loans are also not a different type of loan. They are the same loans but arranged and processed based on an estimated loan amount and before the purchase is finalised or the bike even decided on.
Cutting to the Chase
To take out pole in comparing bike loans, buyers have a number of resources at their disposal. Our Bike Loan Calculator allows buyers to see the loans available through a number of lenders and how those individual loans calculate out to monthly repayment estimates.
Using our finance broker style services can greatly assist many buyers to quickly source the cheapest bike loan. Our Jade Bike Loans consultants do the hard work in sourcing and negotiating loans with our lenders and even assist with settlement.
Comparing bike loans is made easy and essentially becomes a time-consuming thing of the past when buyers engage us to find their bike loans.
To discuss how we can assist bike buyers looking to apply for a 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.
