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Motorcycle loans typically range anywhere from 1-7 years in length. The time it takes to repay the loan will depend on the amount of money borrowed, the type of loan taken out, and the interest rate associated with it.
In this article, we will discuss how long motorcycle loans are and the factors that affect the length of repayment.
- The longest you can finance a motorcycle is 10 years.
- There are two types of loans: secured motorcycle loans and unsecured motorcycle loans.
- Other factors to consider when taking out a motorcycle loan include loan amount, interest rate, down payment, and monthly payments.
- Your monthly motorcycle payment should be at most 10-15 % of your gross monthly income.
What Is the Average Motorcycle Loan Term?
The average motorcycle loan term can vary depending on several factors, including the amount of the loan, the borrower's creditworthiness, and the lender you choose. However, it is common to see motorcycle loan terms ranging from 1-7 years for motorcycle loans.
Shorter loan terms, such as 24 or 36 months, are often preferred by those who want to pay off their loan quickly and avoid paying too much interest over time. These shorter loan terms usually come with higher monthly payments but result in lower overall interest costs.
Some borrowers prefer longer loan terms, such as 60 or 72 months. These longer terms can offer more affordable monthly payments, but it's important to remember that they often result in higher overall interest costs.
Can You Finance a Motorcycle for 5 Years?
Yes, you can finance a motorcycle for 5 years. However, it's crucial to consider your financial situation and goals carefully.
Are you comfortable with the monthly payments that come with a 5-year loan term?
Do you have the means to comfortably afford the loan and still meet your other financial obligations?
These are important questions to ask yourself before committing to a 5-year loan term.
What Is the Longest Motorcycle Loan You Can Get?
The longest motorcycle loan term you can typically get is up to 10 years, although it is more common to see loan terms of up to 5 or 7 years.
While longer loan terms may result in lower monthly payments, it's important to consider the overall cost of the loan. The longer the term, the more interest you will pay over time.
How Does Motorcycle Financing Work?
Motorcycle financing comes in different forms to suit the needs of different borrowers. Two common types are secured motorcycle loans and unsecured motorcycle loans.
- Secured Motorcycle Loans: Secured motorcycle loans require collateral, typically the motorcycle itself. This means that if the borrower defaults on the loan, the lender can repossess the motorcycle to recoup their losses. These loans generally have lower interest rates because they are less risky for lenders.
- Unsecured Motorcycle Loans: Unsecured motorcycle loans don't require collateral, but they often have higher interest rates. Lenders rely solely on the borrower's creditworthiness and income to determine eligibility. Unsecured loans are a good option for those who don't have a valuable asset to use as collateral.
Typical Motorcycle Loan: What to Expect
When it comes to financing a motorcycle, there are several factors to consider, such as the length of the loan, the interest rate, the down payment, and the monthly payments. By understanding these aspects, you can better plan for your motorcycle purchase.
Here is what you want to get a motorcycle loan:
1. Average Length of a Motorcycle Loan
Typically, motorcycle loans have a term of 36 to 60 months. However, it's important to note that the length can vary depending on the lender and the borrower's creditworthiness. In some cases, loans can be extended to longer terms, depending on the loan amount and other factors.
2. Average Interest Rate for a Motorcycle Loan
The interest rate for a motorcycle loan can vary depending on the lender and the borrower's credit score. On average, interest rates for motorcycle loans are usually between 5% to 7%. However, it's important to note that rates can be higher for those with lower credit scores.
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3. Average Down Payment on a Motorcycle
It’s recommended to put down a down payment of 10% to 20% of the motorcycle's purchase price. However, if you have bad credit, it may be prudent to put down a larger down payment. A higher down payment can help reduce the motorcycle loan amount, which can lead to lower monthly payments and a better overall loan term.
4. Motorcycle Monthly Payments
The cost of monthly payments for a motorcycle loan can vary depending on various factors, including the loan amount, interest rate, and loan term.
What Is a Good Monthly Payment for a Motorcycle?
It is generally advised that your monthly payment should be at most 10-15 % of your gross monthly income. This percentage ensures that you can comfortably handle the payment without straining your budget or risking financial hardship.
A good monthly payment for a motorcycle is one that aligns with your financial goals and circumstances. It's essential to carefully consider factors such as your income, loan term, interest rates, and the overall cost of the motorcycle to determine a monthly payment that you can comfortably afford.
Examples of Motorcycle Loans
Upstart provides personal loans that can be used for motorcycle purchases. They offer loan amounts ranging from $1,000 to $50,000 and have terms of 3 to 5 years. Upstart considers factors beyond just credit scores, such as education and job history, to determine loan eligibility. This means individuals with fair to good credit may have a higher chance of approval.
SoFi is an online lender that offers competitive rates and a user-friendly application process. They provide personal loans with loan amounts ranging from $5,000 to $100,000 and have terms of 2 to 7 years. SoFi typically requires a strong credit history and a minimum credit score of 680, making them a good option for borrowers with excellent credit.
3. OneMain Financial
OneMain Financial offers unsecured personal loans with flexible terms and loan amounts ranging from $1,500 to $20,000. They consider a range of factors in addition to credit history, such as income and employment stability. This means individuals with less-than-perfect credit may still get a motorcycle loan.
Final Word: Explore Motorcycle Loan Terms Available on the Market
When it comes to financing a motorcycle purchase, understanding the available loan terms is crucial. Motorcycle loan terms can vary depending on the lender and the borrower's specific circumstances. As a borrower, it's essential to explore the options available to find the best fit for your financial situation.
Browse top motorcycle loans offering competitive rates and terms with Finimpact today