Buying a used motorcycle from a dealer

[Jadex1]

Hello everyone!

I had a some questions about buying a used bike. I am thinking about buying a used bike from a dealership. I wanted to know along with taxes what other things would the dealership add on to the price of the bike. Some of my friends have suggested i buy from a private seller. I don't object to this, but the only problem is it gets harder to find the model of cruiser i am looking for. I'm interested in getting a Honda Shadow Aero. If it also helps i live in California, i don't know if that could affect what things they might add on after taxes. I'm trying to figure out how much to ask for on a loan, but i don't wan to ask to little and not have enough for the motorcycle.

Thanks for any information you can share with me.

Jadex1

[Motorcycle Forum]

[slozomby]

in cali there shouldnt be anything added after taxes on a used bike. assuming the registration is current. which it should be coming from a dealership.

find out from them if they did any servicing to the bike when it came in. if they did they more than likely just added that to the cost of the bike. rather than a separate line item.

from a private seller if they dont have current registration ( even w title in hand) check w/ the dmv before buying. as being a couple of years out of date will significantly increase the cost of getting it current if the bike was not listed as nonop.

[DrBob]

What you ask for is irrelevant- the bank, credit union, or finance company is going to loan you the "loan value" of the bike, which is a percentage of the book resale value of that particular make/ model/ year. Your credit history and score, the amount of your down payment, and other factors will determine how much they are willing to loan you. If this is your first vehicle loan, your est bet is to go to the bank or credit union and see how much they will loan you, then bike shop accordingly or start saving up the difference. A dealership will often use their finance department to get you approved, which is a benefit of buying from a dealership, but the interest rate is higher, and they may not approve you for the bike you want, approving you instead for a less expensive model based on your creditworthiness. Ironically, it is usually easier to get approved for a brand new bike with little or no down payment that with a used one, as the dealership gets special financing money from the manufacturer. If you want to borrow 100% of a bike's value, you'll have to put in for a personal loan, and the bank will loan you whatever your creditworthiness rates, then you can spend it as you see fit. But the rate will be higher, and if you have no previous loans or credit history then they will not loan you anything without collateral.

A used bike from a private party is worth less than the exact same bike from a dealer, because it is assumed that the dealership wants to protect their reputation, so they have cleaned/ inspected the bike, fixed anything dangerous, and will be there to stand behind the bike or at very least be there for you to sue if the bike is crap. None of that holds true of a private sale, where it is strictly 'cash and carry' and you are on your own. Private sellers do not have the high overhead either, and often are highly motivated to sell before their next payment is due, or to get money fast for whatever they need money for. So a bike from a private party usually commands a price about 10-20% less than one from a dealership, making a private sale a good way to save money. But you loose the finance department, the ability to bring the bike back for any minor problems that need fixing, any discounts the dealership may offer on accessories if you buy a bike there, and the relationship with a dealer that may help you when you need service.

If you buy a bike from a private seller and he/ she has a loan on it, you'll most likely need to meet them at their bank with a check from your bank to pay off their loan before you can take the bike home. A bit of a bother, but not a problem if you, your bank, the seller, and their bank are all in the loop ahead of time.

[Easy Rider]

I'm trying to figure out how much to ask for on a loan, but i don't wan to ask to little and not have enough for the motorcycle.

First, go back and read DrBob's post again. All of it.

To kind of sum it up, if you are going for a loan somewhere other than a dealer.....which is almost always a better deal on a used purchase......you need to make TWO visits. The first will be to see if you can even GET a loan......and if you pass that hurdle, then a second one with make, year and model in hand to see how much they will loan. Might be able to do the second step by phone.
It is a good bet to figure that you will need about 20% in cash.

Having said all that, however, I personally do NOT think it is a good idea to finance your "toys".
Save up until you can pay cash.

[DrBob]

15- 20% down plus tax tag (varies by state) and title fee (usually about $25) is a good rule of thumb. A lot of first time guyers think they can pick out a $4000 motorcycle, then borrow $5000 so they can buy the bike, pay insurance, tax, tag, title, and buy a helmet. But it does not work that way, even if you have a strong credit history and a good credit score. No history or less than perfect and the amount goes down, and the interest rate goes up, if they will approve you at all.

[Easy Rider]

pay insurance,

Forgot to mention that.
Shop around a little and find a bike you think you might like.
Call an insurance company or two.......and you might decide you don't like that model so much after all.
If you are financing the purchase, you will be required to carry full coverage until it's paid off.
Depending on your age, driving record, where you live and what bike it is .......insurance can be MORE than your montly bike payment.

[DrBob]

Yup, insurance can be a killer. But to be honest, if someone needs to borrow more than the bike costs just to get insurance, pay the taxes, etc, then they probably have no business buying a toy. Take the expected payment (say $129 a month), plus insurance (maybe $60 a month), plus a few bucks for gas and meals if you were riding on weekends (maybe $20 a week), and put it in a savings account. In 8 months you'll have $2,150, enough to pay cash for an older used bike or put a 50%-60% down payment on a 2002 Shadow Aero. You'll save a bunch on interest, improve your chances of getting a loan, and have a bike just in time for spring. If you can't put that much in savings every month, then you can't afford the bike, because that is at least what it is going to cost you to own it.

[slozomby]

the other side of that is. the bike payment, insurance, and gas combined on my ninja 650 were all less than i was paying in gas a month in my F150 (15 mpg hurts).

$250 a month is a fairly reasonable number for bike loan and operating costs for most folks on an inexpensive bike.