For individuals who carry bad credit score, motorbike loan can be challenging - if not impossible, to arrange because there are motorcycle dealerships with in-house motorbike loans and it is hard to find the bike that you like. You only have the option from a few bike models and settle for what you can find available. Also, local dealers will insist you to cash in huge down payment to acquire their motorcycle loan.
Where to Find Motorcycle Loans for those with Bad Credit?
Having poor credit can limit your options. Aside from the small local dealerships that have few motorcycle choices, you can try to qualify for conventional motorcycle financing at a motorcycle dealership. The problem with most local dealership is that, they do not have a lot of options for bikes on the lot, and if they do, you'll be lucky to find the one that you really like. Plus, these dealerships usually do not want to issue loans to those with bad credit. Nonetheless, the other option is the smart one to go for. So the next thing that you should do is to know your credit score.
Knowing How Bad Your Credit Score Really Is
Given that you have low credit - this may not be the deciding factor for a loan. Financing a motorbike will now depend upon the credits score that you have. However, what's more important is it will depend on the most recent credit record.
If you had poor credit items on your credit history in the past couple of month, then this will affect your credit score negatively, as well as you ability to secure motorcycle financing. The bad credit items a year or more back, do not count as much as the most recent ones. If you have bad credit items, you should try to get them removed prior to applying for bad credit motorcycle loan. Generally, if you have cash when calling the creditors, then there is a good chance of getting the debt removed.
How Does Your Income Affect Bad Credit Motorbike Loan
Another thing that can affect your ability to qualify for a bad credit motorcycle loan is your income. Of course, if you have higher income, your credit score will be less important to the dealership about the motorcycle loan. This will help you because you'll present a lower risk to the dealer if they know that you have high income to pay them back, and that you are not financially struggling when it comes to paying bills.
You also have to make sure that the ratio of your debt to income is low enough. This is the amount of monthly debt that you have monthly. It should be around 30% or lower - 35% max. If the debt to income ratio is higher, let's say it's around 50%, you'll have a difficult time getting motorbike loans - even if you carry a decent credit score.
So if you want to own a motorcycle and obtain a motorcycle loan, you should follow these tips.
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