How to Arrange Bad Credit Motorcycle Loans

The Need for Bad Credit Motorcycle Financing

For those who have poor credit, motorcycle financing can be can be difficult (but not impossible) to arrange because, while car/motorcycle dealerships with in-house motor-cycle loans do exist, it is tough most times to find the brand, style and color that you are interested in. You have to choose from a small number of bikes and settle for what you can find on the lot. In addition, small local dealers will insist on a huge down payment in order to get into one of their motorcycle loan.

Where to Look For Bad Credit Motorcycle Loans?

So what is the best place for people to begin their search for bad credit motor bike financing? Besides small local dealerships that may have a few motor bikes on the lot, poor credit can limit your options. The problem seems to be that most small local dealerships do not have very many bikes on the lot, and if they do you will be lucky to find one that interests you, and that mainstream full-blown motorcycle dealerships usually do not want to issue in-house bad credit motorcycle loans. Nevertheless, there are a few other options for getting poor credit motorcycle financing. The first step is to try to qualify for conventional motor-cycle finance at a motorcycle dealership. That begins by knowing what your credit score is.

How bad is Your Credit Score Really?

The fact that you have low credit at all may not be the deciding factor when a dealership considers bad credit motorcycle loans. Of course financing a motor cycle will depend on your credit score, but more importantly, it will depend on your recent credit history. If you have had poor credit items added to your credit history recently, in the past few months, then this will more negatively affect your credit score and your ability to secure low credit motorcycle financing. Bad credit items from the past, from a year or more back do not count nearly as much as recent items. If you do have any bad credit items in the past year then you should consider trying to get those items removed before you apply for your bad credit motorcycle finance. In general, if you have the cash in hand when calling your creditors, then you have a very good chance at getting the debt removed completely from your credit history.

How Your Income Factors in to Bad Credit Motorcycle Financing

Another item, which may affect your ability to qualify for poor credit motorcycle financing, is your income. The higher your income is, the less important your credit score will be to the dealership when considering your motorcycle finance, whether it is through a (BHPH) “Buy Here Pay Here” local small car lot, or through a fully fledged motorcycle dealership, because you will present a much lower risk to the dealer if they know that you have the income to make your payment and that you are not struggling with paying your bills. Also, make sure that your debt to income ratio is low enough. Your debt to income ratio is the amount of monthly debt that you have each month as opposed to your monthly gross income. It should be right around 30 percent or lower, or 35 percent maximum. If your debt to income ratio is higher, such as around fifty percent, you may have a hard time getting motorcycle loans, even if you have a decent credit history.