Motorcycle Refinance – How To Find Low Interest Rate Motorcycle Refinancing
There are numerous reasons why you may be considering a motorcycle refinance. The most common reason is that interest rates have dropped and you can save on your monthly payment by refinancing. Another reason is perhaps your personal situation changed and you need to extend the term on your current motorcycle loan so that you can lower your monthly payments.
You may also choose motorcycle refinancing to:
- Lower your interest rate which will save you hundreds and maybe thousands in interest charges and provide you with a lower monthly payment.
- Free up money during a personal cash crunch. By extending the term of the loan you can dramatically lower your payment and free up cash.
- Reduce interest cost on the loan by reducing the term of the loan.
One of the issues with a motorcycle refinance is that refinancing a bike is not something most banks offer directly. As a result, you will need to be creative in order to restructure your motorcycle loan.
Your first objective when refinancing a motorcycle will be to contact your existing finance provider and ask what’s the current payoff amount. You will also need to gather all your personal information like social security number, the make model and VIN on your motorcycle, the insurance documentation and a copy of your current loan contract.
Once you know the payoff amount on your current loan you can begin to explore your options.
If you have a high loan balance then you will benefit with a simple interest installment personal loan via an online lender or your local bank/credit union. These financial institutions will provide you a check which you can use to pay off your current loan amount. Normally personal loans have a variety of terms up to 84 months with competitive interest rates so you can restructure your loan to meet your needs.
Another option which works better with lower payoff amounts is to refinance your motorcycle via a 0% Mastercard or Visa credit card. Most 0% credit cards will provide you a cash advance so you can pay off your existing loan. Since the credit card has 0% annual percentage rate for 12 or 24 months this could save you hundreds in interest. However, you need to be very responsible with credit cards and if you can not pay off your loan during the 0% promotion period this is not a good option. Also, if you are not good at managing your money on credit cards this could be a dangerous option.
A home equity loan is another option to refinance a bike if you are a home owner with equity in your house. There are two principal types of home equity loans, a fixed rate loan and a home equity line of credit (HELOC). Either type can be used for a motorcycle refinance; the only difference is the HELOC has variable interest so your payment and interest charges will fluctuate. One of the benefits of using a home equity loan is that the interest on the loan maybe tax deductible. A disadvantage is that if you default on your loan your house is at risk.
Overall motorcycle refinancing is possible and getting a personal loan is probably the easiest and safest option. If you are creative you will find other options in the market.