Motorcycle Loan Question

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Belac · #1 Unread post by **Belac** » Mon May 08, 2006 3:32 am

I'm not sure if this is common back in the US, but I am overseas with the military and both of the banks on my base said I need my motorcycle license to get a loan for one. But the catch is, to get a motorcycle license I need a motorcycle to take the safety class on! (They don't provide bikes for the course on base.) I've heard this isn't an issue with financing from the dealer, but I wanted to know if this was common from a bank back in the US? These are both US banks with just a presence overseas for our convenience. Does anyone know if the interest rates from the dealer are negotiable like they are with car dealers? I should be able to get a 6% loan from my bank, and I saw Suzuki advertising 10.25% which is a bit high. Even if they couldn't match the 6%, I'd be happy with 7 or so.

Also, I noticed you can't get a Capital One Motorcycle Loan under $7,500.

Thanks!

TechTMW · #2 Unread post by **TechTMW** » Mon May 08, 2006 3:40 am

Most banks view a motorcycle as a luxury item - a Toy. Also, you are probably a young dude in the military and overseas to boot. Congratulations, your chances of getting in an accident just went up exponentially. Then there's your credit score ... do you know yours? That's going to have a huge impact on your rate. So, to put it bluntly, you've got about a snowball's chance in hell of having a bank take a risk on your loan. The reason you can get a loan thru Suzi is because they actually give you a credit card and the bike "loan" goes on that - no risk for them. I think that's the only way (in your situation) that you will get a bike.

Is one of the banks USAA? If you have a semi-decent credit rating, USAA might be able to get you a loan on a bike - and they can insure it for you too. (worth a try anyway)

Your best bet (imo) is to find someone w/ a junk bike that you can take the course on and then go from there. Here in Naples, the military provides 2 buell blasts for the course... it's unfortunate they can't get them there. Perhaps if you talked to the guy running the program, he'll have a line on a bike you can use for the class.

Belac · #3 Unread post by **Belac** » Mon May 08, 2006 3:52 am

I am 23, but separating from the military this month. I just paid off a $28k car loan, and also had a $5k truck loan paid off because of it getting totalled in an accident my wife had (no fault to us, she was rear ended). My credit score before my car was paid off was 670 and I qualified for the lowest rate my bank offered (3.45% at the time). Basicly what I am saying is my credit is fine and that is not what is holding me up. What is holding me up is that they are saying I need a motorcycle license to receive a loan from them.

If I wait until I get back to the US, I am afraid they will want me to re-establish a job history (even though there will be no break in my work, I am going from military straight into another job) before they will give me a loan, that is why I am getting the bike now.

I do appreciate the information TechBMW, but it didn't really answer my question.

I am just wanting to know if it is common practice to require a motorcycle license to receive a motorcycle loan through a bank. Also, this isn't because I am young, this applys to ALL motorcycle loans at the banks I asked.

#4 Unread post by **bok** » Mon May 08, 2006 4:00 am

my bro in ND didn't need his full license, but did need his learner's before they would let him finance (if i remember correctly)

I think it might be pretty common, but i've never been in that situation.

maybe get your wife to call around back home and see...and/or talk to your bank back home and ask if you will have to re-establish an employment history after you get back.

TechTMW · #5 Unread post by **TechTMW** » Mon May 08, 2006 4:26 am

Belac wrote: I do appreciate the information TechBMW, but it didn't really answer my question.

My Bad! Well, All my bikes I've purchased using personal loans (Because they were all paid off within a few months) so I've never gotten an actual "Bike Loan."

I understand your concern about having to reestablish a work history - Like Bok mentioned, maybe you could call the bank and find out beforehand - Or, like I did mention USAA is still a viable alternative (Unless you've tried them already)

Belac · #6 Unread post by **Belac** » Mon May 08, 2006 5:00 am

I haven't given USAA a call, I'll check them out. I do carry my current car insurance through them, but no banking.

Does anyone happen to know the answer to one of my other questions: Can you negotiate the loan rate from the motorcycle dealer (Suzuki specifically)? Or since it is a credit card it is only available at the 10.25?

TechTMW · #7 Unread post by **TechTMW** » Mon May 08, 2006 8:11 am

I'm about 90% sure that all the loan details are dealt with out of house, so a dealership will have no control over your rate. The Suzuki CC is probably controlled by a bank - I would also wager that the interest rate actually goes way up after a year or so grace period... You definitely want to finance it from a bank or a credit union, unless you can pay it off within the grace period.

TechTMW · #8 Unread post by **TechTMW** » Mon May 08, 2006 8:15 am

This is taken directly from the Suzuki website -

Any NEW Suzuki Model, as low as $99* a Month for 60 Months!

*On approved Suzuki Finance credit card purchases. 10.95% APR and low monthly payments plus any late fees effective for 60 months. For purchases up to $10,000, your monthly payments will be $99. For purchases between $10,000.01 and $16,500, your monthly payments will be $159.Paying only this amount will not pay off the purchase during this period. Thereafter, the regular Minimum Monthly Payment and either the Standard Rate 17.9% APR or Default Rate 21.9% APR apply. Minimum Finance Charge $2.00. Certain rules apply to the allocation of payments and Finance Charges on your promotional purchase if you make more than one purchase on your Suzuki Finance credit card. Call 1-888-367-4310 or review your cardholder agreement for information. Offer ends 06-30-06. Offer valid at participating Suzuki dealers in the United States excluding Hawaii. See your local Suzuki dealer for details. Offer subject to change without notice..

Belac · #9 Unread post by **Belac** » Mon May 08, 2006 8:53 am

Thanks for the info TechBMW, I did find that same info and it was about what I was expecting. I do believe there is also an option to finance a bike without using their "credit card", I assume through some type of lender they work with. I will be calling the Suzuki dealership I'm working with Wednesday to see if they found a GS500F for me and inquiring on finance, if not I'm considering calling a Kawasaki dealer and pricing a Ninja 250 or seeing if I can find a GS500F somewhere else with a reasonable price.

Thanks again!
Caleb

flynrider · Mon May 08, 2006 12:15 pm

One thing to be wary of when purchasing a bike on a "credit card". U.S. banking laws for credit card agreements are entirely different than those for personal or vehicle loans.

Credit cards are considered revolving credit lines and allow the issuer to change the rules (and the interest rate), merely by notifying you in writing. This is usually a little pamphlet with tiny print that is included in your statement. The card agreement will likely say that they can send you to the Standard or Default rate (17.9% or 21.9%) if you ever make a late payment, or if they find out (via a credit bureau) that you made a late payment to anyone else.

Bottom line : The things I mentioned above would be illegal on a standard bike or personal loan, but are very common in the revolving credit industry. The reason financers prefer to put the purchase on a credit card is that it gives them all of the advantages and you have virtually none. Be careful!