4 Ways to Get a Loan for a Motorcycle

Motorcycles may be a less expensive alternative to cars, but they can still be pricey — a used bike might be as little as a few thousand dollars, but new or used can easily be tens of thousands of dollars, as much as or more than a car. On top of that, you’ll need money to purchase essentials like a helmet, boots, and other protective gear.

If you don’t have the cash saved, you’ll likely need to find a motorcycle loan before you start shopping for a bike. Here are four types of motorcycle loans to consider.

1. Online personal loan lenders

A personal loan from an online lender may be best if the bike you want isn't eligible for financing by a bank, credit union, or motorcycle dealership, or if you want cash-in-hand to buy from (and negotiate with) a private seller. Most personal loans are unsecured and don't require using the bike as collateral, although interest rates on secured loans tend to be lower. 

Online lenders typically offer loan amounts ranging from $1,000 to $50,000 (some lenders offer more), with repayment terms from one to seven years. 

Personal loans also tend to be a less expensive way to borrow money than credit cards. The average annual percentage rate (APR) for a 24-month personal loan was 12.32%, while the average credit card APR was 21.47%, according to the Federal Reserve. 

Some online lenders also offer same-day or next-day funding for personal loans, which could get you on the road more quickly.

Check Out: Best Personal Loan Rates

2. Banks and credit unions

Some banks and credit unions offer loans specifically for motorcycles that are secured by the bike you’re purchasing. A down payment may also be required to qualify.

Since the bike serves as collateral, rates tend to be lower relative to unsecured loans (like personal loans, which we discuss below). It can also make it easier to qualify for a motorcycle loan if you have bad credit.  However, if you can’t make your payments, you risk losing your bike. 

Here are a few banks and credit unions that offer motorcycle loans. Note that none of these are Credible partners.

• America First Credit Union
• Navy Federal Credit Union
• U.S. Automobile Association (USAA)

3. Dealership financing

If you’re purchasing a motorcycle from a dealership, you might be able to get financing directly through the dealer. With dealership financing, you can apply for a loan for the exact amount of the bike you select and get an approval decision on the spot.

Keep in mind that dealership loans might require a down payment. You could also end up with a higher APR than if you shopped for a motorcycle loan on your own with a bank or credit union. Arrive at the dealership with your own financing lined up, so you can use it as a negotiating tactic if need be.

4. Manufacturer financing

Some motorcycle manufacturers — such as BMW, Harley-Davidson, and Suzuki — offer their own financing. These loans are secured by the bike you purchase. Keep in mind that they might also require a down payment.

Manufacturer financing is available for both new and used bikes and might offer lower promotional rates than you’d get from an online lender, bank, or credit union.

Like dealership financing, manufacturer financing could be a good idea if you can get better terms through a manufacturer. Make sure to shop around and compare lenders before making your decision.

How to get a personal loan for a motorcycle

If you take out a motorcycle loan through a specialized financier, the loan will typically use the motorcycle as collateral — similar to how an auto loan is secured by your vehicle. However, if you don't want to use your bike as collateral or only need to borrow a small amount, then you might consider an unsecured personal loan instead.

Follow these five steps if you're ready to get a motorcycle loan:

1. Check your credit: When you apply for a loan, the lender will review your credit to determine whether to lend to you based on your credit profile — so it's a good idea to check your credit beforehand to see where you stand. You can use Credible's credit monitoring tool to review your credit reports for free. If you find any errors, dispute them with the appropriate credit bureau to potentially boost your credit score.
2. Decide which type of lender to use: Motorcycle loans are available from a variety of lenders, including online lenders, banks, and credit unions. Many dealerships also offer their own financing. Keep in mind that depending on which lender and loan type you choose, you might have to use your motorcycle as collateral.
3. Compare lenders and prequalify: Shop around and compare your options from multiple lenders to find the right loan. Consider not only interest rates but also repayment terms, any fees charged by the lender, and eligibility requirements. You can prequalify to see estimated rates and terms before applying. Prequalification won't impact your credit score, but it's not an offer of credit. APRs, terms, and fees in a loan offer may be different from prequalification quotes.
4. Fill out the application: Once you've picked a loan option, you'll need to complete a full application and submit required documentation, such as tax returns or pay stubs. The lender typically performs a hard credit pull, which could bring your score down temporarily.
5. Get your funds: If you're approved, the lender will have you sign for the loan so the funds can be disbursed. Different types of financing can vary in approval and funding times, so be sure to check with the lender to know when you can expect the loan to close.

Learn More: How To Get a Personal Loan

Read More:

• Personal Loans Requirements
• How To Get Approved for a Personal Loan
• How To Get a Low-Interest Loan
• Best Personal Lons for Fair Credit
• Best Personal Loans for Good Credit
• Best Personal Loans for Excellent Credit

Disclosure: Some lending partners that participate in Credible’s comparison marketplace offer loans to borrowers with scores as low as 550. Borrowers with low scores will have fewer lending options than borrowers with higher credit scores.