Fast Scooter Financing In Six Simple Steps
Believe it or not, scooters are becoming very popular in America as fuel prices increase. Manufacturers, like Suzuki, Yamaha, Kymco and Vespa are rolling out new models that have advanced features and price tags as high as $9000. With prices increasing scooter financing is becoming more of a necessity than every before.
So what should you consider when you finance a scooter?
1. Know What You Can Afford
Scooters can range from a couple thousand dollars to as high as nine-thousand dollars. Knowing how much monthly payment you can afford is a key step in choosing a scooter. It makes little sense to purchase a scooter to save on gas if it is going to stretch you financially. Making a good financial decision on how much you can afford to spend will help guide you in finding the best scooter model for your budget.
Once you know your budget researching scooter models is highly important when financing a scooter. The reason being is that some scooters hold their value much better than others once driven out of the showroom. When you finance a scooter you want the scooter that will depreciate the slowest or you could end up having negative equity in your scooter. Negative equity happens when the value of your scooter depreciates faster than the principle on your loan. Scooters that do not hold their used value will burden you with negative equity very fast.
One way to find out how a scooter will hold its value is to compare the new retail value of your scooter with the Kelly Blue Book or NADA value of past model years. Also check different dealers and see if dealers are discounting the scooter or if the manufacturer is offering factory direct incentives. Generally manufacturer incentives cause faster depreciation. Lastly, if the manufacturer has a lot of old inventory in dealer’s stock it will cause faster depreciation.
3. Comparison Shop Annual Percentage Rates
Unlike motorcycles, many buyers find there are big differences in annual percentage rates offered by lenders when getting a scooter loan. Therefore, it is best to shop multiple lenders for the lowest available interest rates. You may try local banks, online lenders, credit unions, and even dealers.
One last option you may consider is a Mastercard or Visa that offers a low introductory interest rate. This option works best with lower loan amounts. Get creative and see what you can come up with.
4. Follow Your Principles
When shopping for a scooter at a dealership make sure you stay within the price range you established for your budget. Dealers love to up-sale and some salespeople are very good at convincing you to go outside your budget.
5. Be Ready For Ancillary Products
Without a doubt when you purchase a scooter the dealership is going to offer you ancillary products. Ancillary products are extended warranties, GAP insurance, pre-paid maintenance, and theft insurance. Before you enter the dealership you need to be prepared and have a thorough understanding of ancillary products. Also before buying these products you should understand how each one will impact your monthly scooter financing payment.
6. Read Your Financing Contract Carefully
As the old saying goes, don’t sign before reading. Your financing contract should be read very carefully before you sign it. If you have any doubt in your mind about what you’re signing then do not sign it.