Owning a Harley-Davidson your first Harley-Davidson is an experience you’ll never forget. But purchasing a brand new Harley-Davidson may outweigh that feeling. Although riding motorcycles can be an imperative hobby in your life, it can be a financial burden sometimes. So when the funds are lower, but you still want to ride, consider getting a financed Harley.
How hard is it to get Harley-Davidson Financing? The answer is simple. The better your credit and monetary income, the higher your chances of approval will be.
This article will look into the steps to get financing, the pros and cons of getting a loan, and other options for purchasing a Harley-Davidson.
What is Financing?
Before we get into which new Harley-Davidson we can go finance, let’s identify what financing is. Financing is borrowing money or creating capital for a purchase you want to pay off as time goes on. For either building, your credit, or you need the funds at that time for the purchase you are targeting. In simpler terms, financing is a small loan that you promise to pay back over time.
Pros And Cons of Financing
When we think about borrowing money, our minds wander to two places. The first initial thought is that I got approved for my purchase, and you’re excited. Following by, I now have to pay back this loan monthly. If you get a loan correctly, it shouldn’t be too much of a burden. Whereas, if you do it rushed, with the correct income, and out of impulse, it could go right.
Pros of Financing
The pro benefits of financing are the ability to purchase what you’re interested in. Regardless of your need for the loan, you’re given some borrowed money to put towards the item, in this case, a motorcycle, you’re approved for. Paying a loan off on time greatly benefits your credit score. Although you’ve already been approved, improving your credit score can help you.
Once approved for a loan(or financing), other creditors will also see that you can be trusted, and in the future, if you need another loan, creditors will be more willing to approve you.
Cons of Financing
The excitement of being approved for a loan can be overwhelming. You start spending the money in your mind before the check is even physically in your hands. If you’re new to financing or it’s your first time, follow these few tips.
- When financing does not get a loan just because you have been approved. Financing a larger sum of money than you can pay back monthly can be detrimental to you and your credit score.
- If loan payments are late, there is a grace period, but once that period passes, your credit becomes affected. Once your credit score drops, you’ll have to earn your “trust” back with lenders before being approved.
- You own the motorcycle once the loan is paid off. Although you have the motorcycle in your possession, the bank or lender you chose has full rights and ownership until you’re paid.
- You can’t modify a motorcycle on a loan because its voids your warranty. Almost all lenders will require you to stay in good standing with the warranty agreement.
What Credit Score is Needed To Finance a Harley-Davidson?
Now that we’ve discussed the benefits and cons of getting a loan, let’s talk about how hard it is to get financed for a Harley-Davidson. Most Harley dealers will use the basic FICO score averages. A very poor credit score is below 580. Whereas, and fair credit score is 580-669, and a great credit score is 669-800.
The lower your credit score is, the harder it will be to get approved. For a poor credit score, which is anything below 580, you’ll have to show proof of income, bank account balance, tax information, etc. With a bad credit score, you’re telling the lender you are the most timely, diligent, or trustworthy candidate for a loan with them.
A fair credit score, 580-669, is relatively easy to get approved. Most lenders will only require proof of income and will gladly give you a loan. Although be weary, most lenders will try to take advantage and give you a high APR. The annual percentage rate or APR is the amount you’ll be charged for borrowing money from the lender. Be sure to keep it as low as possible. Below 10% is ideal. Anything above is quite expensive.
An excellent credit score of 669-800 is the easiest way to get approved for financing on a Harley-Davidson. You’ve proven your ability to be trustworthy, as well as the ability to continue paying loans back on time.
Final Thoughts
Throughout this article, we’ve identified what financing is, how to get financing, and the best way to increase your probability of getting approved. Harley-Davidsons are on everyone’s wish lists this year but reflect on the pros and cons before signing the dotted line.
Before getting a loan, or applying for one, be sure your credit score is where you want it to be. The lower your score, the lower your chances of being approved. With a low score, it might be better to build your credit before putting yourself into more debt.
Remember to negotiate your APR, and don’t say yes to the first lender. There are going to be a few lenders that approve you. Research each lender, try some negotiating, and do your best to get your APR below 10%. Ideally, you’re looking for anywhere between 1-5%.
