Typically, people who wish to buy a motorcycle would spend months or even years to save before they can afford one. But, what if there is an option to get your motorcycle now and pay for it later? Yes, you heard it right, financial institutions in Singapore are offering motorcycle loans.
This type of loan allows you to enjoy your vehicle even though you have not paid it yet. For some, they can use their motorcycle as a source of income. Hence, their income can be used to pay for their loans.
Note that lending companies have their own rules and guidelines on how you should use the loan amount. In certain cases, they would require you to use the loan to buy only a brand new motorcycle.
This article provides you a general view of the industry of motorcycle financing, but remember that the bank or moneylender you chose might have different terms and conditions.
Where to Get a Motorcycle Loan?
1. In-house financing
You can take a loan from motorcycle retailers – businesses that sell the motorcycle you want. While these companies claim that their interest rates are competitive, the interest rates of banks are actually lower.
Borrowers prefer them because, unlike banks, they have a simpler and less restrictive application process. Loan approval is fast and easy because the fund for the loan comes directly from them.
2. Loan company partners of the dealership
Under in-house financing, the loan fund comes from the retail company, here, the loan is from a lending company.
Take note that these dealers often receive commissions and kickbacks from lenders, which means that you might be compelled to pay for a higher interest rate or even a higher motorcycle price.
Also, there is a possibility that you will meet untrustworthy dealers who would sell you unnecessary motorcycle parts and accessories just so they can increase their profit.
3. Motorcycle manufacturer
If you don’t want to go to motorcycle dealers and retailers, you can also take a loan directly from motorcycle manufacturers.
Honestly, this option will benefit consumers the most because manufacturers make a profit out of the sales of their motorcycles instead of the interest of the loans they offer. Also, going directly from a manufacturer will give you a chance to pick the right bike model for you.
One downside of this choice, though, is that there are only a few manufacturers who offer motorcycle loans. If you are in Singapore, it might be a challenge for you to find one. Still, their low-interest rates are attractive to a lot of consumers.
4. Motorcycle refinancing from bank or credit union
Probably the most popular source of motorcycle loans in Singapore are banks and credit unions. The interest rate and financing options they offer are competitive.
Also, they are credible and stable sources of loans. If you are lucky, you can even find banks with various incentives like coverage insurance for clients.
One challenge with them is that they may ask you for collateral (called a secured loan). Also, traditional lending companies would often look at the credit score of the borrower.
Other Financing Option: Unsecured Personal Loan
For someone with a bad credit rating, applying for motorcycle financing from banks, dealers, and manufacturers is extremely difficult. And honestly, most of the options above require collateral.
If you do not have these requirements, the best option for you is to apply for an unsecured personal loan from a licensed moneylender. These private lenders have a fast and easy application process.
If you are looking for shorter loan terms and lower interest rates, you might want to consider taking a personal loan in Bugis Credit Pte Ltd. Borrowers would first file an application online, visit our office to customize the loan tenure, finalize it, and then receive the cash instantly.
We have flexible financing options that would fit the preferences of any borrower in Singapore. Contact us here for more information about our loan payments and motorcycle financing options.
Which the Best Loan Option?
- Both an in-house motorcycle loan and a dealership loan are best for borrowers who want a simple and straightforward loan application process.
- Loan from a manufacturer is an ideal choice for those who have built a good relationship with manufacturers. In most cases, this means that the borrower is able to provide his creditworthiness.
- A bank motorcycle loan is best for borrowers looking for a long-term loan with fairly lower interest rates. You just have to show a good credit rating and be prepared for a longer application time.
- Lastly, a personal loan is best for borrowers who do not have a good credit score and have no chance of taking a loan from banks, credit unions, and manufacturers.
It is for borrowers badly in need of a motorcycle financing plan but is having a problem producing the requirements of other lenders.
Tips for Getting the Best Motorcycle Loan
- Review your credit score. Most lending companies would only give motorcycle financing to individuals who can prove their creditworthiness.
- Know your budget. The loan amount, down payment, fees, and terms of payments you will get are largely based on the type or model of bikes you are choosing from.
- Compare the fees and payment plans of the credit companies. Choose the motorcycle financing plan that fits your finances. Remember that these lending companies are not the same. Also, do not be afraid to search for company promos and deals.
