I got a used sportster financed through HD at around 5.5 which I didnt think was half bad with 10% down. I have pretty good credit for someone my age.

 

My opinion is I do not finance hobbies. That said letting anyone know you have cash blows a lot of your negotiation power out the window. They know they can make a lot of money in the finance end and may well offer you a better deal or the only deal they can make with you since they think that is only way you can get the bike. I always negotiate bottom up never showing my hand other then wanting the best deal as long as it's lower then my local credit union. If we come to terms I then decide what saves me the most be it my interest or dividends out weigh the finance. Usually for me the finance is way more and I pay cash. PS. So far for me has only worked for cars. Harley dealers are a hard nut to crack.

 

Peopl ALWAYS BS on what interest they are paying on their loans, I don't care if it's car loans, mortgage, credit card interest rate etc.. There's a reason why it always seems everyone else makes out so much better than you, it's because they always shed a point or two.

If people are getting 3.1% on a motorcycle loan I would be very surprised. Expect to pay between 6-10% depending on your credit and if you can put 20% down on the bike.

I do agree that I don't finance motorcycles, I would rather own a 20 year old rider that needs work all the time than have to pay a bank $400+ for the privilege of riding their bike for the next 5 years.

 

Same here.

 

Motorcycle rates are much higher then a car loans and in my experience I found HD to have the best rates and longest financing around. My credit union or bank couldn't touch it.

You will find that most financial institutions will not finance over 4 years. Harley finances up to 84 months with no prepayment penalties. I think you will find you can get the most bike for a smaller payment through harley (eagle financial)

 

Obviously in a perfect world you would pay for it up front. But... we all dont live in a perfect world on the beautiful planet of planet rich.

With that being said... I actually found a better deal at the HD dealership then with credit unions. The dealership was 4 points lower. Bank of America was actually >= 1 point lower then Credit Unions around San Diego when I was looking for a loan. Credit Unions were all at 8 or 9% as the lowest rate for a "recreational" vehicle. So the dealership was able to give me the best rate.

Usually the banks and credit unions will say their rate on their website. That way you know what the lowest rate you could get from them is. I shopped around and applied for several loans to see what I would qualify for. By doing that it actually dropped by credit score 37 points. They say that shopping around shouldn't hurt your score but for some reason it hurt mine. I'm not sure why.

anyway, good luck with your buy.

 

I'm far from rich, I own a small house, two beater cars (paid for too), my wife is in school and doesn't work. I rode a beat to crap old evo sportster for years until I had the cash to buy a five year old fatboy.

I see a lot of guys fall in love with a bike and end up with a 6-7 year loan, paying hundreds on the bike each month, and after a few months once the shine has worn off they are really regretting it (just search Craigslist or eBay for the endless bikes 1-3 years old with 1000 miles on them and an owner desperately trying to dump it).

Everyone's free to do what they want, but I like to recommend the option of just save up and buy a used bike in your budget rather than take on a long large loan.

 

I got 4.99 with a 780 credit score for 48 months or 5.99 for 60 through Harley. 10% down.

 

I agree with you even though I did end up financing my Harley. I don't like to finance anything if I don't have too. My situation involved stumbling across a great deal and not having all of the cash up front. I will say that if I do finance anything I pay more than the minimum payments monthly, and for the bike I have financed I should have it paid for in about 6-8 months.

 

I financed my Dyna. I paid through the nose on interest because my credit got tore up in the houseing debacle. I streached out the payment terms for a long time...72 months...

...but that was because I knew I had a settlement coming in for my accident. Paid the payments on the bike for six months (which helped my credit score) then paid the rest of it off with the settlement.

To the OP, you have a lot of good advice here. One person mentioned that dealers love when someone comes in and says "I want that bike there and can only pay $150/month. What can you do for me." He's right, they do.

This allows them to tweak things in their favor. Say they can get you that bike for $150/month over 72 months. But what you don't know is you may have qualified for a 32 month loan with a lower interest rate that would have still been $150/month. Thus you're paying "more" for the bike because you're paying more than double what you needed to.

Do your homework. Know what your credit score is. Know what's on your credit. Know what that entitles you to. It use to be if you were over 700 you could get whatever you wanted now that score has pushed up to about 750. Research interest rates over length...they do fluctuate depending on how long you want to borrow for. Also know what a fair price is for the bike you want. With Harley's, it's usually MSRP.

Now here is where you can take advantage of the dealers. Now walk in and say "I want that bike for $150/month. What can you do for me." The difference now will be you know that monthly payment is based on a certain purchase price with a certain interest rate over a certain time. When you negotiate, don't fluxuate from that monthly payment or those terms. Stay strong.

I do this with cars all the time. I came in one time with a figure of $315/month over 36 months. Took three days of negotiating...they started at $820 or something. I walked out at $318/month...threw them a little bone. Play their game and use their tools against them. Example:

"Okay, you win, $326/month."

"It's still not $315/month."

"Oh come now, it's only $11/month difference. That's not eating out once a month. Surely you can do that."

"True, it is only $11/month difference. That's 11 fewer free cups of coffee for you guys a month. Surely you can do that. $315/month or no deal."

I love f$%king with car dealers. LOL I was one for a short period of time so I've seen both sides. Some things you should know.

To a dealer, no one has perfect credit. I saw my sales manager once take a credit report for a customer with a 760 credit score. That really did entitle them to whatever financing they wanted. But they had ONE late payment 4 months ago on ONE credit card. My sales manager highlighted that late payment then took the report out to the customer and acted like that one late payment might pose a problem. It didn't, but the customer now got it in their head because of the sales managers acting that they were going to have to take a higher interest rate. My sales manager NEVER let them see their actual credit score and they had no idea just how good it was.

The first figure is a "Hit" figure. When you start negotiating, the dealer will usually come back with "The banks require a third down and with $5K down you're monthly payments will be 700/month on this $12,000 bike." Absured, right? Well, that's exactly what it is and they know it. They call it a "hit" figure because what they're doing is hitting you over the head with the idea that the figures you came in with are way unrealistic. Since many buyers just pull a figure out of their *** when buying a vehicle this "hit" figure is very effective. If you've done your homework then you should see the hit figure being the stupid smoke and mirrors that it is.

Monthly payment trap. As we've mentioned, they negotiate based on montly payment because it lets them manipulate the figures behind the scenes to arrive at that montly figure in their favor. Since most people, when they finance, do so based on what they can afford to pay per month, this is an effective strategy for most dealers. If you try to talk about price of vehicle, trade in value, or interest rate they'll ignore that and try to steer you back towards monthly payment. This is why I always suggst to have a monthly payment amount set based on your homework so that way you know if you stick to that payment amount you should be getting a fair deal.

It's your money. Remember, they need YOU...not the other way around. One of the best tools a buyer can use is his feet...don't be afraid to walk out. You'd be amazed at how "the best we can do" when your sitting at the table becomes "not the best we can do" when you walk.

Good luck and let us know how things go.