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Do You Need Good Credit To Finance A Motorcycle?

hRiding a fancy motorcycle is every guy's dream, but when it comes to purchasing one, the price tag puts an end to it. The cheapest motorcycle even costs you several thousands of dollars. Unfortunately, it is a massive amount that many of us cannot afford. It is not easy to earn money in this modern era, and when you think about spending it all at once, your heart skips a beat. Looking at the circumstance, many people say no to their dream of riding a bike. But luckily, one can wrap their hands around a fancy motorcycle with the help of a motorcycle loan.
"Do you need a good credit score to finance a motorcycle?"
Yes, and no. However, there is no limit specified to it, but more or less, if you would have a good score, it will be easier to get affordable deals. Like it works in a way that if you have a great credit score, it will lower the interest rate. As a result, you don't have to spend a lot on interest.

What Credit Score Do You Need To Finance A Motorcycle?

You must have done your homework when you thought of financing a motorcycle. Financing a motorcycle is not easy as many clauses and conditions are attached to it. However, it is beneficial too, as you don't have to worry about all of your savings. When you think of financing a motorcycle, you first need to apply for a motorcycle finance.
While after submitting it, it is upto the lender to decide which credit model they want to use. It is also possible that the lender might consider several credit score options. Consequently, the effect of your credit score deviates and is based on the model the lender is using.

2.Don’t Carry Over Your Old Negative Equity

Negative equity is basically a method through which you need to pay more than the actual cost of something. It applies several different kinds of properties. However, talking about this negative equity is like a deal with the devil.Suppose a bike costs around eight thousand dollars, but you paid ten thousand dollars for it. So, your negative equity will be two thousand dollars. However, if you still haven’t reimbursed that loan and consider carrying that into a new loan, just don’t! If you do this, you will end up paying extra in the form of interest.


Credit Score Models

Mainly, three basic credit score models are used. They are listed below:

FICO Score 8 and 9

These are the most basic models. Typically, they are not for an auto loan but based on your application and score, the lender can consider them.

FICO Auto Scores

This is the model that is designed especially for auto lenders. A FICO Auto Score would explain the borrower's ability and how easily the payments can be made. It is a kind of estimation of how long it will require for the person to return the money.

Vantage Score 3 and 4

This scoring model is slightly different from the others, but it is also vividly used by many lenders. However, it is somewhat complicated, so it is preferred less than others.

What Else Do Motorcycle Lenders Look at to Determine Financing?

There are other factors that the lender would be observing other than the credit score. So, if you have filled out a form for a motorcycle loan, these things would also be considered by your lender:

  • Credit backlog
  • Debt to income percentage
  • Down expense
  • Total loan
  • Conditions of loan

Other than the listed factors, the lender would also be looking at the motorcycle specifications you are financing. The informational details that the lender would be evaluating are:

  • How much the motorcycle costs
  • What is the value of the motorcycle
  • The model and age of the motorcycle
  • If you are trading it with an old one of yours

How To Improve Your Score Before Applying For A Loan

By now, you must have chosen the motorcycle you want and thought of getting a loan. Looking at your credit score, you might be thinking, is there a way to improve your score before signing up for a motorcycle loan? Look into these steps that will help you along the way.

  • The first and the most important thing is to ensure that all the details on your credit account are up to date and verified. Accuracy at all times can boost your credit score.
  • ake a look at your credit scores; now, you must know where you stand. Then, you can try to improve the score by taking action wherever required to improve them by taking the necessary action.
  • To have a good credit score, you must have a credit utilization ratio of less than thirty percent. So, ensure you don't have a lot of debt on your credit card.
  • Before signing up for the loan, ensure you have a clean payment history. Your bills and payments should be on time for a good credit score.

What Is A Good Credit Score?

A good credit score is based on the model the lender is going for. They all work differently – Fico score 8 and 9, and Vantage Score use the same module. Their scoring starts from 300 to 850. On the contrary, the FICO Auto Score model has the lowest score of 250 and a maximum of 900.Long story short, there is no estimation of the credit score that is required. It would be entirely based on the module that your lender is using.

How To Check Credit Score?

You can check your credit score via the credit card report that gets prepared every month. Therefore, it is not a hassle as you can request a copy of your credit card report and quickly get to know your credit score before applying for a motorcycle loan. However, several agencies can help you provide a free copy of your credit report.


Whatever purpose you are getting, a motorcycle makes life a lot easier. Hence, you can add some life to your garage and easily finance or purchase a bike. But before financing a motorcycle, make sure you skim through these factors as they can help you greatly regarding your credit score.Moreover, the greater the credit score, the fancier the bike you will get!