RiverTrace Blog

A Guide to Motorcycle Loans in Richmond, VA

Posted on: October 10th, 2017 in Auto Loans

Buying a motorcycle can be a great investment for several different reasons. Not only are they incredibly fun to ride, but motorcycles are often less expensive than other vehicles. Not only that, they also tend to have much better fuel efficiency than cars and trucks.

motorcycle loan guideMotorcycle Loan Guide

Of course, if you decide to buy a motorcycle, you'll most likely need to take out a loan. Few people have the money available to buy a motorcycle outright after all.

Here are a few of the most common questions we get asked about motorcycle loans and answers to go with them:


How can I get a motorcycle loan?

It's worth noting that not all lenders offer loans for motorcycles. Motorcycles are generally considered luxury items and are purchased mostly for recreational use. This means that some lenders simply may not offer loans specifically for motorcycle purchases. Here at RiverTrace, we do as part of our auto financing products and services.


How long can I get a motorcycle loan for?

For motorcycle loans (and all other recreational vehicle loans), we offer loan terms between 36 and 144 months. This provides flexibility when it comes to determining how much you can afford to pay off on their loan each month and how quickly you want to pay it off.

What is the interest rate on a motorcycle loan?

The interest rate is going to vary greatly depending on many different factors. You can expect the interest rate on a recreational vehicle loan to be higher than traditional auto financing. This is due to the increased safety risk of riding a motorcycle.

Most lenders view motorcycles as a recreational vehicle that's also considered a luxury item. They're assuming the borrower is paying for or has bought a primary vehicle and has the extra money available for a recreational vehicle. The assumption is that if they have the extra money for a luxury item, they can afford higher interest rates.

At RiverTrace, we offer RV loan rates that are competitive with the rates offered by other lenders. However, you'll notice that many lenders do not offer motorcycle or VR loans like we do.

Last but not least, there are many individual factors that contribute to the interest rate. These factors are based on your financial history and responsibility. Lenders will check your credit history for any blemishes. A high credit score means that you're less of a risk. A low credit score means that you're a financial risk to lend money to, which means your interest rate will go up.

How can I qualify for a motorcycle loan?

When you apply for an RV Loan, the lender will look at a number of different factors to determine whether you qualify or not. These factors are very similar to other types of loans, including car loans and personal loans. They include the following:

Your credit score

Your credit score helps give lenders an idea of how financially responsible and capable you are. A good credit score means that you are less of a risk and that you're likely not to default on your loan.

Your credit history

You may have rebuilt a damaged credit score into a good credit score, but there could be blemishes on your credit history that are red flags to lenders. For example, any unpaid debts, late payments, defaults or foreclosures are a cause of concern for lenders.

Your debt-to-income ratio

Even with excellent credit, your debt-to-income ratio will come under close scrutiny. If you have too much debt, lenders may not have confidence that you'll have enough money to comfortably meet your loan payments.

Your credit utilization ratio

This refers to how much credit you have versus how much of that credit you've used. If you're using a majority of the credit that was extended to you, you may be viewed as an irresponsible borrower.

Are motorcycle loans the same as car loans?

In many ways, car loans and motorcycle loans (RV loans) are very similar. The lender will use the same factors to approve or reject your application as they would for a car loan.

While these factors might be the same, they are usually a lot stricter for RV loans. This is due to the increased risks involved with motorcycles compared to cars.

The loan limits for RV loans also tend to be lower because motorcycles are generally less expensive. As mentioned, the interest rates on motorcycles are generally a little higher than those on car loans.

How can I determine what I can afford?

Keep in mind that just because you will be borrowing money doesn't mean that you can afford whatever you want. It can be tricky to budget properly for a motorcycle if you don't know what you're doing.

First, figure out your monthly payments by looking at the APR not the interest. Then take into account the other expenses associated with buying a motorcycle (insurance, maintenance and repairs, gas, riding gear, etc.). This will give you a better idea of what it will cost so that you can figure out what you can afford.

These are a few important questions that you might have if you're thinking about taking out a loan in order to buy a motorcycle.

For more information about our RV loans or how to apply for an RV loan so that you can buy a motorcycle, be sure to contact us at RiverTrace today.

If you need to contact us about a news item, event, or just want to give us a shout, please don't hesitate to get in touch with us by calling 804-266-2767 or emailing us.

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