The heat is fast, you live in a big city with little parking and you want to buy your own, but not too expensive, means of transport? Motorcycle credit may be the perfect solution. However, there are several financing options on the table for this same vehicle.
Motorcycle credit can be requested at the stand itself, you may have to resort to a proprietary credit (especially when buying a new motorcycle) or you may even purchase it through personal credit. But in the end, what are the pros and cons of each solution?
1) Motorcycle credit through the stand or brand
When you buy a motorcycle you will probably first go to a stand or the brand itself to buy it. The truth is that, in terms of financing, they have very competitive options. And motorcycle credit is no exception. It is even possible to get credit solutions where the APR is literally 0%.
The big snag? This usually happens in time-limited campaigns or on certain models. So if you want to opt for this solution (and yes you can save a lot of money on it) you have to be aware and see which stand / brand offers the best alternative to the bike you want. Also, don’t forget: at the stand the bike is usually new and unused and this financing only applies if the vehicle is new. If you want a used motorcycle it will be difficult to resort to this alternative.
2) What if I opt for credit with reservation of ownership?
If the idea is to buy a new motorcycle, this is usually the mode that banks present. The property reserve credit works as follows: it asks for financing for the motorcycle, but over the duration of the contract it bears the mention of Property Reserve in favor of the respective bank.
That is, the client cannot sell the car without the express permission of the financial institution and, if the agreement fails and defaults, the ownership of the car passes to the creditor.
The big advantage? As there is a tangible guarantee behind credit, the interest rates on this financing alternative tend to be lower.
3) A motorcycle credit can be a personal credit…
Especially if the motorcycle is used, the most widely used alternative to motorcycle credit is personal credit. With regard to this product, the market has several offers. The following table shows which are for the purchase of a used motorcycle worth 6,500 dollars in 48 months. The case type refers to a single person, with a monthly net income of 1,000 dollars and fixed expenses of 400 dollars.
Like other forms of credit, personal credit has advantages and disadvantages. It has the “positive” side of not being subject to reservation of ownership, which means you can change bikes before paying the full credit. It is also tending to be a faster financing loan.
But, on the other hand, as the bank does not have the “guarantee” of the vehicle on its side, interest rates tend to be higher. But the best thing is to try the simulation for your specific case and see how much this two-wheel financing would look like.