Monetary loan

What is the duration of a motorcycle loan?

NEW YORK – June 1, 2022 – (

iQuanti: There are a lot of things to consider when looking for a motorcycle loan. Apart from the initial thinking about how much you need to borrow, it is also important to look at the interest rates and the repayment term. Plus one motorcycle loan is, the more it may cost you overall.

Where to find your financing

Getting financing to cover the purchase of your new motorcycle directly from the dealer or manufacturer will usually tie you to a secured loan with repayments over a 3-5 year period. Non-traditional lenders often offer a secured loan because it means less risk. With a secured loan, your motorcycle is the asset used as collateral. If you don’t meet the loan payments at any time, the lender can repossess your bike to cover the rest of the money you owe them.

An alternative to taking out a secured loan from the dealership is to take out an unsecured personal loan from a traditional lender or financial institution.

A traditional lender can provide unsecured personal loans that can be taken out for 2 to 5 years. The main advantage of taking out an unsecured loan is that the loan money is paid directly to you. You then have the choice not only to buy a new or used motorcycle, but also to use it to finance the maintenance of the bike, repairs or new riding equipment. In addition, since it is not secure, your motorcycle is never at risk of being repossessed.

Short term or long term, which is better?

There are pros and cons on both sides when choosing to take out a short term motorcycle loan over a long term motorcycle loan.

By taking out a short-term loan, you’ll pay less interest because it doesn’t accrue over the long term. This would make the loan cheaper overall, but it would mean much larger monthly repayments.

If you have taken out a short-term secured loan, the monthly repayment can take up a significant portion of your budget. It’s worth considering whether you could afford these larger refunds if unavoidable money troubles (like reduced work hours or huge medical bills) arose. If you miss a payment on a secured motorcycle loan, the lender will repossess your motorcycle.

Choosing a long-term loan would mean you pay more in total over the life of the loan, but the monthly payments are much more manageable.

Having a lower monthly repayment allows you to breathe more into your day-to-day finances, which may be better for many people. Even if you have a secured loan, as the monthly repayments are lower, it is less likely that a situation will arise where you cannot afford to repay the loan and risk having the bike taken over.

The bottom line

As with all things personal finance, the length of time you should take out a motorcycle loan for is unique to your situation – there is no universally best option; it depends on your current financial situation and how you prefer to manage your money.

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What is the duration of a motorcycle loan?