How to Finance a Motorcycle
Motorcycles offer freedom — just you, two wheels and the open road ahead. But that freedom can come at a high cost. Although the average used motorcycle only costs between $3,000 and $6,000, a new bike can set you back by as much as $65,000 if you’re after a premium ride, according to J.D. Power. Unless you’re ready to drain your savings for a motorcycle, you might need to get a loan.
So where can you get motorcycle financing, and how does it compare to auto loans? We’ll walk you through how to finance a motorcycle below.
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How to get motorcycle financing
Financing a motorcycle can be similar to getting an auto loan — you’ll get a traditional, secured loan through a bank, credit union or dealership. Alternatively, you can take out a personal loan, which may come with higher rates because your motorcycle won’t serve as collateral. Regardless of the path you choose, you’ll follow the same basic steps to get started:
Check your credit score
First, check your credit score to understand the types of loans you may qualify for. Having excellent credit means you’ll have the most options and are likely to receive the best rates.
If your credit score needs a little bit of work, consider waiting a few months so you can improve your credit score. Pay down outstanding debts, reduce your credit card usage and review your credit report for errors that can be fixed. Once your score improves, you’re ready to apply for financing.
But what about if your credit history has some serious blemishes? While you can get a motorcycle loan with bad credit, it’ll come with a high APR, increasing your total cost of borrowing.
Determine your budget
Before getting motorcycle financing, figure out how much you’re able to spend. That means calculating how much you can offer as a down payment and what you can afford to pay each month.
The larger the down payment, the smaller your monthly payments will be. Choosing a longer repayment term will keep monthly payments down, but you’ll pay more in interest over the life of the loan. It’s smart to select the shortest loan term you can reasonably afford.
Use our motorcycle loan calculator to understand how your motorcycle purchase will fit into your budget.
Pro Tip: Don’t forget motorcycle insurance premiums, taxes and registration fees when setting your budget!Choose a motorcycle
Now it’s time for the fun part: Shop around for a motorcycle. Just make sure the bike you choose aligns with the budget you set for yourself.
You’ll need to know basic information about the motorcycle when applying for the loan. You’ll need to supply details like the bike’s make, model and year, like the vehicle identification number (VIN) and the mileage.
Lenders may also want to know the estimated loan amount — that’s the price of the bike (minus any down payment), plus any gear you want to finance.
Apply to multiple lenders
Dealerships frequently inflate consumer loan APRs, so get a couple of offers directly from lenders without the middleman. It doesn’t hurt your credit score to apply to multiple lenders for a motorcycle loan any more than it does to apply to one, if you do all applications within a 14-day period.
After receiving multiple loan offers, compare rates and terms to determine which lender offers the most competitive financing option.
Close your loan
Choose the best motorcycle loan offer for your needs and finalize the paperwork with your lender. If you’re purchasing a motorcycle from a dealership, the finance manager can guide you through the process. Be sure you understand the repayment schedule so you can make your first loan payment on time.
Where to get motorcycle financing
Finding a motorcycle loan may not be quite as simple as finding an auto loan, but you have lots of options for financing your next bike.
Online lenders
Online lenders are a great option for motorcycle financing. Because they don’t have the operational expenses of brick-and-mortar lenders, you can often receive more competitive rates and faster funding than loans from traditional institutions.
Some online lenders offer traditional motorcycle loans, while others offer personal loans that you can use for buying a motorcycle. These are unsecured loans, meaning the bike won’t serve as collateral (and you may not need a down payment) — but you’ll likely pay higher interest rates. Lenders like LightStream offer unsecured loans that can be used for motorcycles.
Credit unions
If you want a traditional motorcycle loan, a local credit union may be your best option. Credit unions tend to offer lower rates than large banks, but you’ll need to be a member of the credit union to receive the loan.
Each credit union has its own requirements to join, but it’s usually not too challenging to become a member. Some credit unions require an affiliation with a profession, community or You can also join credit unions open to everyone, like PenFed Credit Union or Consumers Credit Union.
Start your search with the best credit unions for car loans — these tend to have good motorcycle financing programs as well.
Some of our favorite credit unions for motorcycle loans include:
- NuVision Federal Credit Union
- Credit Human
- Digital Federal Credit Union (DCU)
- Navy Federal Credit Union
- Greater Texas Federal Credit Union
Banks
Like credit unions, banks may offer traditional motorcycle loans — that is, loans secured by the bike itself. The benefit is lower interest rates on the loan, but there’s a catch: If you fall behind on payments, the bank could repossess your motorcycle.
If you’ve got a military connection, you can usually get competitive rates for motorcycle financing through USAA Bank.
Keep in mind that not every major bank offers motorcycle financing.
Dealerships
Purchasing a motorcycle from a dealership? The salesperson can help you secure a motorcycle loan through the dealership’s lending partner. Getting your loan and your bike in the same transaction can simplify the purchasing process.
However, rates are often higher when you finance through the dealership, so we still recommend shopping for a motorcycle loan on your own.
If you’re buying a brand-new bike, you might be able to get financing straight from the motorcycle manufacturer. Larger brands, such as Harley-Davidson, Ducati and Yamaha, are more likely to have in-house financing and may offer limited-time promotional APRs or loans with no money down.
Frequently asked questions
You can finance a motorcycle with poor credit, but you’ll have fewer options available. Typically, you’ll need to find an online lender offering bad-credit personal loans to cover the purchase. Expect to pay higher-than-average interest rates and more expensive origination fees for your motorcycle loan.
To get an affordable rate on a motorcycle loan, you’ll need a credit score of 660 or higher. Borrowers with excellent credit scores (800 or above) are most likely to receive the lowest rates.
How long you can finance a motorcycle depends on the type of loan you get. Most personal loan terms range between two and seven years. A traditional secured motorcycle loan from a bank or credit union typically comes with repayment terms of three to five years.
Yes, you can lease a motorcycle, though it’s less common than leasing a car. You’ll spend less money on a lease than you would buying a motorcycle outright, but you’ll only get to ride it during the life of the lease and won’t be able to sell the bike down the road. When leasing, you’ll be bound by mileage restrictions and you won’t be able to customize your bike to your liking.