Are you considering to purchase a motorbike in 2016? Before you do, you should ask yourself the following questions to make the purchasing process easier so you can own your new wheels in no time.
Should you purchase your bike from a dealer or privately?
If you purchase your motorbike from a dealer, you will usually receive more assurances with the bike. For example, warranties, guarantees and even some bonuses such as paid registration for three to six months. Purchasing the vehicle privately should allow you to negotiate a much lower price. However, don’t expect to receive any perks. Plus, the risk of something being wrong with the motorbike is much higher. At the end of the day, you want to receive the best value for money. Ensure that you conduct a thorough inspection and negotiate any short-term returns should any issues arise with the motorbike.
How will you finance the purchase of your motorbike?
If you have the cash, you can purchase the motorbike outright without any hassle. If not, you will need to consider a loan either from family, friends or a lending institution. You may have family or friends that can provide you with an interest free loan. However, many people will need to opt for a loan from a lending institution like a bank or private lender like Positive Lending Solutions. Before applying for your motorbike loan, you should consider the following.
How competitive will the interest rates be?
Many people compare the competitiveness of loans on the lower interest rates available on the market. While this does give an indication of what you will pay, it doesn’t tell the full story when it comes to the cost of your loan. There are several other elements that will also impact the overall cost of your loan.
Are there any additional fees that need to be considered?
Fees will impact the direct cost of your borrowing. You may find that the lender has setup fees, account keeping fees, exit fees and other types of fees that will erode the savings made on cheaper interest rates. These fees aren’t usually displayed as prominently as interest rates. Be cautious and look into any additional fees that come with the loan.
What will be used as the security for the loan?
The security will be used as leverage against the funds that are being lent to you. It could be the motorbike itself or another asset that you own. Should you miss payments or default on the loan, the lender may repossess your motorbike. The lender may give you the option for an unsecured loan, however you will be expected to pay a higher interest rate.
Are there any early termination fees associated with the loan?
Lenders want to make as much money as possible from you over the life of the loan. Should you pay off the loan early, you are minimising their profit significantly. Many lenders will add early termination fees to recoup some of the lost profit. Check the small print for any associated costs and permissions when it comes to early terminations.
Are there any inclusions that come with the loan?
Check the fine print to see what is actually included with the loan. Will you also be able to use the loan to purchase apparel, accessories or extended warranty? If not, you will need to source additional finance to pay for the extras.
Getting your motorbike is exciting, but you want it to be as hassle free as possible. Don’t put yourself into a tricky financial situation from purchasing your motorbike. Consider how you will purchase the motorbike carefully and how you can get a deal that will allow you to manage the ongoing costs successfully.