Quote:
If you finance, low payment relative to total loan value means long term debt, in this case 6 years. Within three years or less, one would owe more on the bike than it would be worth. If you can't afford to pay the bike off in the shorter term, you'll just wind up saddled with debt when you want the next bike...
If OP want to keep the bike that long, great, but he then has to consider financing cost in the total cost of the bike. Low monthly costs may seem attractive but they can be a trap towards debt servitude.
Sorry to go on about this but banks are real happy to get people up to the hilt in debt - the OP should think about whether it's really worth it for his second bike!
You're preaching to the choir here, I pay cash, and while I suggest that, sometimes it's not possible.
Been there done that.
And with interest rates this low, there has been no better time to totally screw your life up with debt.
As you mentioned, if you take the loan, you need to be prepared for a couple of things.
One, it's a semi-long term commitment.
Two, you generally have to provide full coverage insurance, which can be extremely high when compared to liability only.
Three, be prepared to bank back money for maintenance, either tools and stuff to do it yourself or for the shop costs.
Four, Depreciation sucks, and the first few years, it hurts the most. But, it's a fact of life. Some motorcycles depreciate more than others - I'd not want to own a Harley right now.
Five, If you want to sell it before the end of the loan, the paperwork can be a nightmare unless you do the deal with the a dealer. Even then, you better be sure they are reputable. Some have been known to not pay the bikes off, or worse.....
Six, don't worry too much about it, just be sure you have enough motorcycle to last you for 5 or 6 years. If not, it's only money.
Oh - and take the shortest loan you can afford.
$185.00 a month and in 3 years, it's paid for.