Sara Routhier, Managing Editor and Outreach Director, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming world o...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He also has an MBA from the University of South Florida. ...

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Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Jan 27, 2012

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Unfortunately, auto loans and motorcycle loans are considered to be two different kinds of financing in lenders’ eyes. While the loans act in the same way, one cannot simply apply for an auto loan and use that money to purchase a motorcycle without their lender’s consent. This is because many car loan lenders don’t issue motorcycle loans due to the belief that motorcycles are riskier bets.


Since motorcycle loans are viewed as higher risks to lenders, they often carry higher interest rates and stricter standards when it comes to qualifying. Like most types of financing, borrowers will be better off if they have a higher credit score. A reliable job, low monthly bills, and few outstanding debts will also help an applicant obtain the money needed to get that perfect bike.


Also, while car loans can typically be financed over a two to five year term, motorcycles loans are often administered for one to three years. Sometimes a borrower can squeeze a longer term out of a lender, but more often than not they should expect to pay the motorcycle off quicker than they would be allowed to pay off a traditional automobile.


But keep in mind: motorcycles require more money than just the purchase of the bike itself. Unlike a car, where one can pick up a car loan and drive off the lot with their new vehicle, motorcycles require extra gear before a law abiding citizen can make use of them. Motorcycle helmets and protective armor have both become necessities in most states throughout the country. The cost of this gear can range anywhere from an average of $100 to $200 each.


In exchange for shelling out an extra $400 or so before even turning the bike on, motorcycles often get between 50 and 70 miles to the gallon, which can equate to a ton of money if replacing a traditional automobile for commutes. Also, given the fact that motorcyclists can bypass traffic far easier than car drivers, the expense of a motorcycle loan plus gear can wind up paying for itself in saved time.


Just remember, sitting in traffic is much more comfortable than sitting in a hospital bed. Only skip traffic by splitting lanes when it’s safe to do so. For more information on motorcycle safety and awareness, visit the National Highway Traffic Safety Administration’s page on motorcycles.