72 Month Motorcycle Loan, watch out for high interest rates and Rule of 78 that penalizes those entering the motorcycle financing process.
Looking for a 72 month motorcycle loan? The majority of people who enter the motorcycle buying process look for a 72 month motorcycle loan for the purpose of lowering the monthly payment of their motorcycle purchase.
Beware, many motorcycle lenders associate greater risk with a 72 month terms and look to take advantage of motorcycle buyers with higher interest rates and the Rule of 78 interest calculations.
Make no mistake, when you get 72 month financing be sure the motorcycle lender is not using Rule of 78 to calculate the interest. Rule of 78 penalizes you as a motorcycle buyer because it charges mostly interest in the first 36 months. Consequently, you are paying very little towards the principal on your loan during the first 36 months. This can really hurt you if you sell your motorcycle because you will likely find your motorcycle is worth much less than you owe.
Bottom-line, if you want a 72 month term be sure to find a motorcycle lender that uses simple interest.
In addition, be wary of motorcycle lenders that have substantially higher interest rates just because the term is longer. If you are forced to use a motorcycle lender that charges a higher interest rate for longer terms, use your credit history to negotiate a better interest rate.
It is highly recommended that before you apply for motorcycle financing you fully understand your credit history. Get a copy of your
free credit report from each of the three credit agencies (Equifax, Experian, Trans Union). Understanding your credit will help you tremendously in negotiating a better interest rate.
If you are interested in great interest rates check out our motorcycle loan
tips above.
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Understanding your credit will help you tremendously in negotiating a better interest rate. In addition, be wary of motorcycle lenders that have substantially higher interest rates just because the term is longer. Bottom-line, if you want a 72 month term be sure to find a motorcycle lender that uses simple interest.
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Local banks and credit unions many times have strict credit scoring guidelines that look highly at past payment history. Many credit repair agencies are extremely good in finding errors that 72 month motorcycle loan can dramatically increase your credit score. If you have bad credit it may first be best to check your free credit report for discrepancies. Choose from the below providers to help you in your search:. This can make a big difference in you getting approved.
