Dealer Financing vs. Bank Loan

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Dchi0175 · #1 Unread post by **Dchi0175** » Thu May 24, 2007 1:49 am

I am looking to buy a new bike(new to me at least) in the next month or so. Is it better to finance the bike through a dealership or take out a loan from the bank? I know that usually a dealer requires full coverage for a finainced bike, but does a bank as well? I would much rather pay for it out right and have been saving for it, but I am getting impatient. Let me know.

Thanks.

tortus · #2 Unread post by **tortus** » Thu May 24, 2007 2:28 am

A dealer's financing is still through a bank. In all cases, financing will require full coverage. For a brand new bike you might want full coverage anyway, regardless if you finance.

Your personal bank, and especially a credit union, will probably be a better deal. But if your credit is at all iffy, the dealer is more likely to approve you (they really want to approve you, it means a lost sale if they can't)

Suzuki, Kawasaki and Yamaha (and probably Honda too) are all running deals now where it's $69 to $99 a month for two years for a bike!! woohoo! well, read the fine print, it's really not a great deal.

Dchi0175 · #3 Unread post by **Dchi0175** » Thu May 24, 2007 3:17 am

Thanks for the input. I read up on the Yamaha website about their "good" offer. It didn't sound to appetizing once I read the fine print. I'll probably go through my bank so I can have the freedom of buying outside of a dealership.
Thanks again.

Scott58 · #4 Unread post by **Scott58** » Thu May 24, 2007 3:22 am

Go with the best interest rate you can find.. When i got my S50 they were offering 3.9 for so many months then it was suppose to go to 9.9. Before that happened I transfered the balance to Capital1 at a fixed 4.9. was able to pay it off in less then 2 years. Also got the title back early due to the transfer.

KingRobb · #5 Unread post by **KingRobb** » Thu May 24, 2007 3:52 am

Loans should be determined mathmatically. Nothing else matters.

Dchi0175 · #6 Unread post by **Dchi0175** » Thu May 31, 2007 1:23 am

I checked out a couple of loan places and I came across the same problem with each one. They require that I buy the bike from a dealership. The one I have had my eye on is from a private seller. Is there any financial organization that will give me a loan to buy from a private party?

Nibblet99 · #7 Unread post by **Nibblet99** » Thu May 31, 2007 2:11 am

Not really, you're into the territory of unsecured loans if you want to buy privately, which means a higher rate of interest

Zagnut · #8 Unread post by **Zagnut** » Thu May 31, 2007 8:36 am

Well, if you have a history with your bank, your credit is good, and you have enough collateral, I can't see why a bank wouldn't give you a loan for a bike from a private seller.... long as they're sure they'll get their money back with interest, I would imagine they'd do it.

DieMonkeys · Thu May 31, 2007 12:28 pm

In my opinion, wait it out. Save more. It'll be better in the long run.

You are probably young enough that you won't have a heartattack and die in the next few months from waiting.

Impatience will cost you greatly.

Now, if you were older, like late 30s or older I'd say go ahead, get the loan, do whatever, you're already set in your ways. But if you're a kid, getting a loan is not a smart idea. What happens if you don't pay the bill on time? Is it really worth screwing up your life?

flynrider · Thu May 31, 2007 1:29 pm

Dchi0175 wrote:I checked out a couple of loan places and I came across the same problem with each one. They require that I buy the bike from a dealership. The one I have had my eye on is from a private seller. Is there any financial organization that will give me a loan to buy from a private party?

I'm not sure what a "loan place" is, but a bank shouldn't care where you buy the bike. They will require a lien on the title until your loan is paid off, and insurance to safeguard their investment. I can't see why they would care who the seller is.

One more point on your original post. Most of the motorcycle dealerships are offering financing by offering you a "credit card" or revolving credit line. That's how they can make those monthly payments sound so good. It's like making the minimum monthly payment on a regular credit card. It may not be a lot of money every month, but you'll be paying it forever. Also, federal regulations for revolving credit are very different from a standard consumer loan. Basically, the lender can change the rules (i.e. interest rate) when they want, for whatever reason they want. With a standard consumer loan, you know exactly what you'll pay for the life of the loan, down to the penny. A bank can't arbitrarily change the terms of a consumer loan.

This will all be specified in the fine print (which no one ever reads) on the loan agreement. In short, a bank loan has set terms, a credit card or revolving credit line does not.