Key Takeaways
- Motorcycle financing options include dealership loans, personal installment loans, bank and credit union programs, and manufacturer financing—each with different rate structures.
- Checking your credit score before you apply gives you a realistic picture of the rates you can expect.
- Getting pre-approved from two or three lenders puts you in a stronger position to negotiate at the dealership or when purchasing a used motorcycle elsewhere.
- Total cost of ownership is more than just the sticker price and includes insurance, maintenance, gear, and registration, all of which factor into your monthly budget.
- Financing for motorcycles is available even with less-than-perfect credit, though rates and terms will vary.
Between dealership offers, bank loans, and online lenders, motorcycle financing can feel overwhelming. This guide covers every motorcycle financing option available, how to finance a motorcycle step by step, and what to watch for so you don’t overpay.
- Motorcycle Financing: Quick Comparison
- Comparing Your Motorcycle Financing Options
- How to Finance a Motorcycle in 6 Steps
- Example Motorcycle Loan Breakdown
- Tips for Qualifying for Better Motorcycle Loan Terms
- Motorcycle Financing: FAQs
- Take the Next Step Toward Financing Your Motorcycle
Motorcycle Financing: Quick Comparison
Use this table to quickly compare motorcycle financing options and find the best one for your buying needs.
| Financing Option | Best For | Funding Speed |
|---|---|---|
| Personal installment loans | Buyers who want flexibility and are buying from private sellers | Same day to a few days |
| Dealership financing | Buyers seeking the convenience of a one-stop purchase experience | Same day to a few days |
| Bank and credit union loans | Buyers with a strong credit score who are purchasing newer bikes | 1 to 7 business days |
| Manufacturer financing | Buyers who are purchasing specific new motorcycle models | Same day to a few days |
| Leasing | Buyers who are looking to upgrade their bikes regularly | Same day to a few days |
Comparing Your Motorcycle Financing Options
The average cost of purchasing a motorcycle is slightly over $12,000—though the final price can vary depending on the brand, engine size, type, features, and where you buy it—making it essential to choose a financing option that works for your needs. Here’s how the most common motorcycle financing options compare.
Dealership financing
Dealership financing is arranged through the dealer, who connects you with a lending partner. The process is convenient since you handle everything in one visit, but dealers may mark up the interest rate above what the lender offered. You also won’t have access to every lender on the market, just the ones the dealer works with. This works best for buyers who have already compared outside rates and can use their pre-approval as leverage.
Personal installment loans
A personal installment loan gives you a lump sum you repay in fixed monthly payments over a set term. Because the loan isn’t tied to the motorcycle, you can buy from a private seller, something most other options won’t allow. This works well for buyers with varied credit histories.
Here’s a quick breakdown of how dealer financing and personal loans are different:
| Dealer Financing | Personal Loans |
|---|---|
| Uses the bike as collateral | Usually unsecured |
| Often limited to dealership purchases | Can be used for dealership or private seller purchases |
| Promotional APR may be available | Fixed monthly payments |
| Limited lender options | Shop multiple lenders |
Bank and credit union loans
Banks and credit unions offer loan options for motorcycles with competitive rates, especially for borrowers with strong credit. Credit unions often beat bank rates because they operate as nonprofits. The trade-off is a longer approval timeline and stricter criteria. If you already have a relationship with a bank or credit union, ask about member rate discounts—they can shave a quarter to half a point off your APR (Annual Percentage Rate).
Manufacturer financing
Major manufacturers like Harley-Davidson, Yamaha, and Kawasaki run their own financing programs, often with promotional rates like 0% APR. These deals save you significant interest, but they usually require excellent credit and may only apply to specific models.
Leasing
Leasing a motorcycle means you’re paying to use it for a set period rather than owning it. Monthly payments tend to be lower, but you won’t build equity, and you’ll face mileage restrictions. If you don’t know whether to buy or lease but switch rides every few years, leasing might appeal to you, though fewer lenders offer motorcycle leases compared to auto leases.
How to Finance a Motorcycle in 6 Steps
Once you’ve weighed your options, here’s how to move through the process from start to finish:
Step 1: Check your credit score to unlock better rates
Your credit score directly affects the APR you’ll be offered, so pulling your credit report is the logical first move. Even a 50-point difference can shift your rate by a full percentage point. So, what’s the minimum credit score required? There’s no universal minimum. Some lenders work with scores in the low 500s, while banks and credit unions may require 650 or higher.
The average interest rate for a new car loan is about 6.37%, so you can expect a higher interest rate for a motorcycle since rates are typically more elevated.
Step 2: Calculate your budget and total cost of ownership
Figure out what you can afford each month before settling on a specific bike. A loan payment calculator can help you model different price points, rates, and terms. If you don’t already have a financial budget in place, now is the time to build one.
Beyond the monthly payment, factor in the total cost of ownership. These expenses catch first-time buyers off guard:
- Insurance. Costs vary by bike type and riding history. For example, sport bikes cost significantly more to insure than cruisers.
- Maintenance. Oil changes, tires, chain adjustments, and brake pads typically run $500 to $1,000 per year.
- Registration and taxes. Title, registration, and sales tax vary by state, but can add $200 to $500 upfront.
- Safety gear. A helmet, jacket, gloves, and boots usually cost $500 to $1,500.
- **Extended warranties. These are optional and can provide peace of mind, but they may also increase your total purchase price. **
- **Accessories. Phone mounts, security locks, luggage racks, and other accessories can add up quickly. **
Step 3: Get pre-approved
Pre-approval means a lender, like a bank, credit union, or dealership partner, has reviewed your credit and income and given you a conditional offer. This gives you a spending ceiling and a baseline APR to compare against dealership offers. Most pre-approvals involve a soft or hard credit pull and stay valid for 30 to 60 days, so time your applications accordingly.
Step 4: Compare motorcycle loan rates from multiple lenders
Don’t settle for the first rate you see. Pull quotes from at least two or three sources — a bank or credit union, an online lender, and the dealership. Look beyond the interest rate; loan term, origination fees, prepayment penalties, and total interest paid all matter.
Step 5: Choose your motorcycle
With your budget set and pre-approval in hand, you can shop with confidence. New motorcycles give you access to manufacturer promotions, while used bikes come at a lower price point but may carry higher rates. When financing motorcycle purchases from private sellers, a personal loan is usually the way to go since most lenders require a dealership transaction.
Step 6: Finalize the loan
Once you’ve selected the bike and lender, review the loan agreement carefully. Confirm the APR, monthly payment, loan term, and any fees before signing. Make sure nothing changed from your pre-approval terms, and ask about any line items you don’t recognize.
Example Motorcycle Loan Breakdown
Here’s a sample scenario to show how financing a motorcycle plays out in practice:
| Detail | Amount |
|---|---|
| Bike price | $12,000 |
| Down payment (10%) | $1,200 |
| Loan amount | $10,800 |
| APR | 7.5% |
| Loan term | 48 months |
| Estimated monthly payment | ~$261 |
| Total interest paid | ~$1,728 |
| Total cost | ~$13,728 |
Note: This example is for illustrative purposes only. Actual loan amounts, APRs, monthly payments, and repayment terms vary based on the lender, your credit profile, and the motorcycle being financed.
A larger down payment or shorter term would reduce total interest paid. For instance, bumping the down payment to 20% ($2,400) on this same loan would drop the monthly payment to about $244 and save you roughly $340 in total interest over the life of the loan.
Tips for Qualifying for Better Motorcycle Loan Terms
Small moves before you apply can lead to noticeably better rates. Here are a few worth prioritizing:
- Put down at least 10% to 20%. A larger down payment reduces the loan amount and signals less risk to the lender.
- Pay down existing debt first. A lower debt-to-income ratio improves your profile across nearly every lender type.
- Keep loan terms under 60 months. Longer terms mean lower payments but significantly more total interest.
- Avoid new credit applications before applying. Each hard inquiry can temporarily lower your score. Shop around for rates within a 14-day window to minimize the impact.
- Consider a co-signer. If your credit is thin, a co-signer with strong credit can help you qualify for a personal loan at a better rate.
Motorcycle Financing: FAQs
Is it easy to get financed for a motorcycle?
It depends on your credit and income. Borrowers with good credit often get approved quickly through banks, credit unions, or dealerships. If your credit is lower, personal installment loans and subprime lenders offer more accessible paths at higher rates.
What are the average motorcycle interest rates?
Average motorcycle loan rates fall between 4% and 12% for borrowers with good to excellent credit. Fair or poor credit may push rates to 15% to 24%. Rates vary by loan term, lender type, and whether the bike is new or used.
What is the difference between dealer financing and personal loans for motorcycles?
Dealer financing is arranged through the dealership’s lending partners and uses the bike as collateral. Personal loans are unsecured and aren’t attached to the motorcycle, so you can buy from private sellers. Dealer financing may offer promotional rates, while personal loans provide more flexibility.
How much can I borrow from Sun Loan for a motorcycle?
How much money you can borrow from Sun Loan for a motorcycle depends on several factors, including your credit score, credit history, debt-to-income (DTI) ratio, income, employment stability, and where you live. Here are the current maximums for the states we cover:
- Alabama – up to $5,000
- Illinois – up to $10,000
- Missouri – up to $4,502
- Nevada – up to $4,000
- New Mexico – up to $10,000
- Oklahoma – up to $3,540
- Tennessee – up to $2,000
- Texas – up to $1,800
Can you finance a motorcycle with bad credit?
Yes, you can still finance a motorcycle with bad credit. In addition to your credit score, lenders look at your debt, income, and employment to determine whether you’re a trustworthy borrower. Just remember that a lower credit score typically means paying extra fees and interest. Before you buy, compare motorcycle financing across personal loan providers, credit unions, and dealership programs to find the best rate.
Making a larger down payment or adding a co-signer can also increase your likelihood of approval if you have a bad credit score.
Take the Next Step Toward Financing Your Motorcycle
Check your credit, compare rates from multiple lenders, and know your total cost of ownership before committing. If you’re looking for motorcycle financing options that work with a range of credit profiles, Sun Loan offers personal installment loans with a straightforward application. Apply online or visit a branch near you to get started.
