These Losses Are Affecting All Loans But In General Motorcycle Loans May Be Impacted A Little More

Category: Finance.

Over the past year, the motorcycle loan market saw motorcycle lenders start taking a closer look at motorcycle loans due to the problems they were having with bad credit mortgage loans. The first part of the New Year will see banks facing much more pressure due to bad credit mortgage loan losses.

In the New Year you can expect things to remain a little stricter. These losses are affecting all loans but in general motorcycle loans may be impacted a little more. For one, motorcycle buyers should not expect low motorcycle loan rates as in the past. With the New Year looking stricter for motorcycle loans many motorcycle buyers are asking what should my expectations be for the New Year. Even though mortgage rates are decreasing currently motorcycle lenders are being squeezed due to a higher cost of funds. In 2008, Fair Isaac will roll out a new credit scoring model that will help you if you have been recently current on your loans and credit card payment. No longer can lenders raise funds as cheap to loan so they have to raise interest rates to compensate.

However, you should not expect this new credit card scoring model to be used with motorcycle loans anytime in the near future. In addition banks are having tons of trouble with funding so before they implement any changes in credit scoring models they will address their funding issues. With motorcycle and auto loans banks normally take some time before they adjust their scoring model to the new credit scoring model. The bottom line is that in 2008 it will be more difficult to get motorcycle loans. Online lenders are lean and do not many times have the overhead that banks have. For motorcycle buyers internet motorcycle loans may work out a bit better in the new year than other forms of financing. As a result, they can frequently offer some better rates.

This helps them offer better rates than many of the bigger banks that have substantial mortgage loss exposure. Many of the internet based motorcycle lenders did not do mortgage loans so they do not have huge loss exposure. If you have bad credit and are declined for a motorcycle loan do not get discouraged. But in the New Year declines will be more frequent so you will likely have to submit applications with different banks and lenders. Often new motorcycle buyers find themselves discouraged by a decline. Owning a motorcycle is one of the best experiences so make sure you get to enjoy this lifestyle.

Also there is good communication from online motorcycle lenders so your service will be high quality. With internet based motorcycle loans you will find that it is quick to submit an application and get a response. When you are approved for motorcycle financing online your funds arrive fast and you can get to the dealer quickly to pick up your bike. This is simply a reflection that the banks are way under funded and need to be very wise about their loans. You may find in 2008 that motorcycle lenders also force you to put money down for a motorcycle loan where in the past they were more willing to give you a zero down payment motorcycle loan. With disposable income per household decreasing lenders are keeping a close eye on motorcycle financing.

You should try to get a motorcycle loan quote before you get a loan or purchase a bike. Also losses are likely to increase with the economy slowing so it is important to remember that lenders may require motorcycle insurance. Some motorcycle insurances are running really high these days and this will help you determine if you can afford the bike and insurance. If this sounds familiar to you from past experience it is important you do not let it overwhelm you. Getting a motorcycle loan sometimes can be difficult. Simply remain positive and if you are declined go to the next lender. Remember in the New Year it will be harder to get approved than in the past so persistency will pay off.

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