It’s no secret that having a low credit score can be a real pain in the neck. You might not be able to get approved for a loan, or you might have to pay through the nose for interest rates. But did you know that your low credit score could also prevent you from financing something as simple as a bike?
Believe it or not, your credit score can have a big impact on your ability to finance a bike. Many lenders will take a close look at your credit history before approving you for a loan, and if you have bad credit, you might not be able to get the financing you need.
If you’re looking to finance a bike but you’re not sure if your credit score is up to snuff, don’t worry. We’re here to help. In this article, we’ll go over all the facts you need to know about financing a bike with bad credit.
What is a Credit Score?
In short, your credit score is a number that represents your creditworthiness. It’s based on your credit history, and it’s used by lenders to determine whether or not you’re a good candidate for a loan.
There are a few different types of credit scores, but the most common is the FICO score. This score ranges from 300 to 850, and the higher your score, the better.
Generally speaking, a score of 700 or above is considered good, while anything below that is considered bad. However, keep in mind that this is just a general guideline – your actual score may be lower or higher depending on your credit history.
Now that we’ve answered the question, “what is a credit score?” it’s time to talk about what credit score you need to finance a bike.
What Credit Score Do You Need to Finance a Bike?
Unfortunately, there’s no easy answer to this question. Every lender is different, and they all have their own standards for what constitutes a good or bad credit score.
With that being said, you’ll probably need a score of at least 600 to qualify for most bike loans. However, the higher your score, the better your chances of getting approved – and the lower your interest rates will be.
If you have bad credit, you might still be able to get approved for a loan – but you should expect to pay higher interest rates and put down a larger down payment.
How to Check My Credit Score?
Before going out shopping for a new bike, it’s a good idea to check your credit score. This way, you’ll know exactly where you stand and what kind of financing options are available to you.
There are a few different ways to check your credit score. One option is to request a free copy of your credit report from one of the three major credit bureaus – Experian, Equifax, or TransUnion.
Another option is to sign up for a credit monitoring service like Credit Karma or Mint. These services will give you regular updates on your credit score, and they’re usually free to use.
Once you know your credit score, you’ll be able to start looking for financing options that fit your needs.
What Bike Can You Afford with Your Credit Score?
Bikes come in a wide range of classes and prices, so it’s important to narrow down the field to find one that fits your budget.
If you have good credit, you’ll probably be able to afford any bike you want. However, if you have bad credit, you might need to stick to a more modest bike.
Ducati (740+)
Ducati’s are some of the highest-quality bikes on the market, and they’re also some of the most expensive. Their prices range from around $15,000 and can be as high as $65,000 for certain models.
We’ve asked several Ducati dealers online and locally about their credit score requirements and found that you will need a credit score of 740 or higher to finance one of their bikes. Having a credit score of at least 740 will ensure you qualify for the best interest rate without having to put any money down.
However, if you’re interested in a Ducati but your credit score is lower than 740, you might still be able to finance the bike – but you should expect to pay a higher interest rate and put down a larger down payment.
Harley Davidson (600+)
Another popular bike manufacturer is Harley Davidson. Like Ducati, their bikes are also on the expensive side, with prices ranging from around $15,000 to as high as $40,000.
We talked to a few Harley dealers and found you can finance a Harley with a credit score as low as 600 for many of their models.
You may even finance a Harley Davidson with a credit score lower than 600 if you have a co-signer with good credit and a large down payment.
Honda (580+)
If you’re looking for a more affordable bike, Honda is a good option. Prices for their bikes range from around $2,500 to $30,000.
When it comes to financing, Honda is more lenient than other manufacturers. We talked to a few dealers and found that you can finance a Honda bike with a credit score as low as 580.
Like with other manufacturers, the higher your credit score, the better your interest rates will be and the less money you’ll need for a down payment.
How to Improve Your Credit Score to Finance a Bike
If your credit score isn’t where you want it to be, there are a few things you can do to improve it before you start shopping for a bike loan.
Pay down existing debt: One of the biggest factors in your credit score is your debt-to-income ratio. This is the amount of debt you have compared to your income.
If you can, try to pay down some of your existing debt before applying for a bike loan. This will improve your chances of getting approved and may even help you get a lower interest rate.
Build up your credit history: Another important factor in your credit score is your credit history.
If you don’t have much of a credit history, try to build it up by using a credit card responsibly and making all of your payments on time. This will show lenders that you’re a reliable borrower and help improve your chances of getting approved for a loan.
Check for errors on your credit report: Sometimes, errors can appear on your credit report that can drag down your score.
If you think there may be an error on your report, you can contact the credit bureau and ask them to investigate. If they find that there is an error, it will be removed from your report and your score will improve.
FAQs about Financing a Bike with Bad Credit
After reading this, you might still have some questions about financing a bike with bad credit. Here are some of the most frequently asked questions we get about this topic.
Can I get approved for a bike loan with bad credit?
It’s possible to get approved for a bike loan with bad credit, but it will be more difficult than if you had good credit. You may also have to pay a higher interest rate and put down a larger down payment.
What’s the minimum credit score I need to finance a bike?
The minimum credit score you’ll need to finance a bike will depend on the manufacturer and the dealer you’re working with. In general, you’ll need a score of at least 580 to have a good chance of getting approved.
Can I improve my credit score before applying for a bike loan?
Yes, you can improve your credit score by paying down existing debt, building up your credit history, and checking for errors on your credit report. These steps will help you get approved for a loan with a lower interest rate.
Do I need a down payment to finance a bike?
It’s possible to finance a bike without a down payment, but you may have to pay a higher interest rate. If you have a down payment, it will help lower your monthly payments and may even help you get approved for a loan.
How much of a down payment do I need to finance a bike?
The amount of your down payment will depend on the dealer you’re working with and the type of bike you’re financing. In general, you can expect to put down 10-20% of the total cost of the bike.
Final Thoughts
The credit score you’ll need to finance a bike will depend on the type of bike you’re looking to buy, the dealer you’re working with, and the down payment you’re willing to make.
In general, you’ll need a score between 600 and 740. Having a co-signer or putting down more than 20% will improve your chances of getting approved for a loan.
If your credit score doesn’t meet the minimum requirements, there are still things you can do to improve your chances of getting approved. Paying down existing debt, building up your credit history, and checking for errors on your credit report will all help you get a loan with a lower interest rate.
If you’re still having trouble getting approved for a loan, you can always try financing through a private lender or an online lender. These lenders may be more willing to work with you if you have bad credit.
Whatever you do, make sure you compare rates and terms from multiple lenders before signing any loan agreement. This will help you get the best deal possible and avoid paying too much interest.
Do you have any other questions about financing a bike with bad credit? Let us know in the comments below!
