If you were to purchase a motorbike from a dealer, they might offer their own in-house financing options. Often, they will attract you with competitive interest rates, but in-house financing is usually more expensive than a bank.
Basically, they offer convenience. They have no credit checks so it's fast to get approval. At times, they might throw in more incentives or freebies. However, it's a secured loan because your motorcycle is the security. Some Singaporean dealers design loans to be compatible with their borrower's financial situation. This flexibility is usually not available with banks.
An alternative to motorcycle financing is to take a loan directly from motorcycle manufacturers, otherwise known as the principal.
This is a preferred option among many consumers since manufacturers make a profit out of the sales of their motorcycles rather than interest rates from loans they offer.
However, there are only a few manufacturers who offer motorcycle loans. For Singaporeans, it might be a challenge for you to find one since most places that sell vehicles are dealerships.
This is probably the most popular source of motorcycle loans in Singapore are banks and credit unions. Usually, for a traditional loan, the interest rates and financing options they offer are competitive.
Since they are huge organisations, it also makes them a credible financing option.
One challenge with banks is that they may ask you for collateral. Also, traditional lenders would conduct a credit check to ensure their borrowers have a good history.
Banks could also provide you with an option for full coverage insurance to go along with the monies granted because honestly, riding is extremely risky.
Peer-to-peer lending is borrowing from a site that connects individuals who need to borrow money to investors willing to lend.
Websites like these are managed professionally too, so borrowers who are unable to borrow from banks might want to include this in their list of loan options.
In instances where you can’t get a motorbike loan, you could take a personal loan from a licensed moneylender or a bank. A personal loan is an unsecured loan that can be used for almost anything.
For someone with a bad credit rating or someone who does not want to put down any collateral, this would be the best motorcycle loan option.
You can use a portion of the loan amount to make the down payment and the remaining to finance other needs as well like your credit card bill, or use the full amount for your bike.
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So you don’t borrow more than you need and incur unnecessary debt. Use a loan calculator to figure out monthly repayments and road tax payments. Note that this is only an estimate.
It’s stressful enough having instalments to pay off. So make sure you work with a licensed and regulated lender in Singapore.
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