Getting great finance for your new bike

Getting great finance for your new bike

We’re coming up to the mid-year and you all know what that means – EOFYS! For those not in the know, we’re talking about End of Financial Year Sales. Dealers will be desperate to offload their old stock for incoming new stuff – and you can grab a great bargain while you’re at it. Some of them might be reducing prices; others might be giving you cash back or other freebies.

2020 was a difficult year for motorbike sales – off-road was up while on-road was down – and your chance of nabbing something for a fantastic price is better than ever. With interest rates as low as they’re ever going to be, it’s also your best chance to be approved for a low interest personal loan.

Here’s how to get some great deals on finance – and knowing what to avoid.

Where will you be riding?

You’ll need to figure out where you’re going to do most of your riding. You’ll need a licence and rego if you’re planning to use it as your daily driver or over tracks on public land. If you’re just going bush bashing or planning to do some racing, you won’t need a licence or rego. A minibike or MXer cannot be registered – and can’t be ridden on normal roads anyway. And yes, “road” has a legal definition – “any highway, back road, trail or single-track that can be accessed by the public.”

Remember your costs include protection

If you have a budget in mind, remember to factor in your licencing and rego (if you’re going that route), jackets, helmets, gloves, leathers, and other protective equipment. Some helmets can go for up to four figures – so be wary.

Steer clear of “zero” percent finance

When you’re browsing through sales this EOFY, you’ll see a whole stack of offers to encourage you to buy. Last year, Kawasaki’s “off road fun” finance deal offer was for 0.99%p.a. comparison rate finance (more on comparison rates later.) There’s no such thing as a free lunch and no such thing as a super low finance rate without a few catches.

Bill Tsouvalas, Managing Director of Savvy and expert on all things personal loans, says reaching for the closest loan isn’t necessarily the best option. “These loans all have small print – ‘terms and conditions apply.’ This might be taking away your ability to haggle for a lower price, extending the loan term so you pay more in interest overall, or loading up on fees and charges. At least look at the fine print – but going to a lender or bank will give you a better result.”

Look at comparison rates

Not all interest rates are the same – as we mentioned before, you will see two kinds of rates. The normal kind and a comparison rate. A comparison rate, Bill says, is “the base interest rate and most fees and charges such as account keeping fees rolled into a percentage per annum. It makes it easier to compare two loans with the same loan term. If it only has a base interest rate, you’ll need to figure out how many fees are loaded on top before you can get a clear picture of how much the loan will cost.” This also makes using a personal loan calculator much easier, as you only need to know the amount you need to borrow, the loan term, and the interest rate. It’ll give you rough estimate how much you’ll owe in repayments each month (or fortnight.)

“If in doubt, see a broker who can show you many different loans from a variety of lenders – it saves so much time looking around yourself.”

By researching loan options before you get your heart set on a bike, you can be ready to pounce on that great deal the moment it comes along.