7.99% for 72 Months?

[FROG MAN]

For those of you who buy on credit a question? Yamaha factory financing rates are 7.99% for 72 months. Is this a good deal compared to say a bank? Are motorcycle financing rates higher then an automobile? I have used Yamaha before on ATV financing and found the minimum payment due is less then half the normal monthly payment on promotion.I never had to use that option but found it nice in case of temporary hard times. No money down just sign and drive. Don't forget about the catch though. If a payment is missed the default rate goes to say 27% or if the promotion is not paid in full at 72 months you can expect 18.99% for the balance.Banks may be cheaper interest but require money down or shorter terms.No I'm not buying just always looking.

[Squidley]

My new one was 9.99 % I plan on opening up an account at a local Credit union and refinancing it at 7%. The draw you in deal that dealerships offer is for Bill Gates, I have VERY good credit and I couldn't get the LOW rate they offered. So I'll just let someone thats interested in working with me make some money.

[FROG MAN]

Brad I think credit is just getting harder to get. I also think maybe a motorcycle loan carries a higher interest rate then a automobile. Good luck in finding a cheaper rate.

[Squidley]

Brad I think credit is just getting harder to get. I also think maybe a motorcycle loan carries a higher interest rate then a automobile. Good luck in finding a cheaper rate.

 

I agree Gerry, and thats not necessarily a bad thing, we are so close to this country going under it isn't even funny. I love my bike, but hated paying that much money for it

[GeorgeS]

If you have any way to join a Credit union. Check out their rates.

 

My CU, is offering any type of vehical loan, at 4.75 precent.

[FROG MAN]

No credit unions here. Our states biggest employer is Walmart.

[Eddie Fulmer]

My credit union offers 5.45 on all new vehicles as of 9-18-08. I'm about to purchase a new truck and have to use Ford's financing (8.99%)to get the rebates but can pay them off with a credit union loan on the first payment. Go figure.

[autopilot]

My credit union offers 5.45 on all new vehicles as of 9-18-08. I'm about to purchase a new truck and have to use Ford's financing (8.99%)to get the rebates but can pay them off with a credit union loan on the first payment. Go figure.

 

There ya go!! Where there's a will (or an Eddie in this case), there's a way!!! A man after my own heart..

[Condor]

There ya go!! Where there's a will (or an Eddie in this case), there's a way!!! A man after my own heart..

 

Yep, my father in law did that when he bought a new GMC truck off the showroom floor. Pissed the dealer off...

Another way to finance is take out a line of credit on the house. You don't need to use it untill you're ready to pop for a bike, and any interest is a tax write off. Usually the interest rates are much better than what sounds like credit card financing with the 27% penalty rate if your late. Bought a boat like that. Went down, looked at it, took out the check book and wrote the repo bank a check for 50 large. No muss.. to fuss.. no bother. And the interest was next to nothing.

[az1103]

My credit union offers 5.45 on all new vehicles as of 9-18-08. I'm about to purchase a new truck and have to use Ford's financing (8.99%)to get the rebates but can pay them off with a credit union loan on the first payment. Go figure.

 

Better check their prepayment penalty policy......

[FROG MAN]

A friend of mine wanted to pay cash for a new vehicle. They would not give him all the rebates and cash incentives without a loan. He borrowed the money and payed it in full the first payment due.

[Celt]

7.99% is a decent rate up here in Canukland. i financed my 08RSV thru Yamaha at 7.99 for 60 months. bank rates are more as are credit unions, as far as i know. everthing is more expensive up here

[flb_78]

I paid 0% for 0 months.

 

 

I bought my bike used and paid cash for it.

 

Let someone else take the hit on the resale value.

[Blackjack]

Provided the Yamaha loan was actually an installment loan and not a revolving account, here's how the numbers work (assuming $18000 borrowed):

 

Principal borrowed: $18000.00

Annual Payments: 12

Total Payments: 72 (6.00 years)

Annual interest rate: 7.99%

Monthly payment amount: $315.51

Total Repaid: $22716.72

Total Interest Paid: $4716.72

Interest as percentage of Principal: 26.204%

 

Revolving accounts are quite different in that interest is charged daily on the outstanding balance and then added to the total, so that you actually also pay interest on the interest expense you accumulate. If the minimum payment were less than the $315.51 indicated above, and you only made the minimum payment, you would have a balloon payment (likely a significant one!) due at the 72nd month!

 

A home equity line is an interesting option for a number of reasons: first, you will own the bike outright and it gets shifted from the liability to the asset column of your personal finances; second, as mentioned in another post, if you itemize your federal taxes, you will be entitled to an interest expense deduction, making it possible for the effective interest rate to be less than the rate offered by Yamaha; third, since (home equity) lines of credit typically have a 15-year repayment period, the monthly payment obligation can be significantly less (only about 60% of the installment loan payment).

 

You can also pay cash, if you have it! Although the markets are particularly shaky right now, one should ask whether the same amount of money invested in some type of financial instrument (even a fixed-rate annuity!) could provide a yield that would reasonably exceed the interest expense involved in borrowing the funds.

 

There is no correct or right or wrong answer to any of this, and I am not advocating one approach over any other. It really depends on your understanding the numbers, how they work, and what works best for you, personally!

 

Terry

[Redneck]

Provided the Yamaha loan was actually an installment loan and not a revolving account, here's how the numbers work (assuming $18000 borrowed):

 

Principal borrowed: $18000.00

Annual Payments: 12

Total Payments: 72 (6.00 years)

Annual interest rate: 7.99%

Monthly payment amount: $315.51

Total Repaid: $22716.72

Total Interest Paid: $4716.72

Interest as percentage of Principal: 26.204%

 

Revolving accounts are quite different in that interest is charged daily on the outstanding balance and then added to the total, so that you actually also pay interest on the interest expense you accumulate. If the minimum payment were less than the $315.51 indicated above, and you only made the minimum payment, you would have a balloon payment (likely a significant one!) due at the 72nd month!

 

A home equity line is an interesting option for a number of reasons: first, you will own the bike outright and it gets shifted from the liability to the asset column of your personal finances; second, as mentioned in another post, if you itemize your federal taxes, you will be entitled to an interest expense deduction, making it possible for the effective interest rate to be less than the rate offered by Yamaha; third, since (home equity) lines of credit typically have a 15-year repayment period, the monthly payment obligation can be significantly less (only about 60% of the installment loan payment).

 

You can also pay cash, if you have it! Although the markets are particularly shaky right now, one should ask whether the same amount of money invested in some type of financial instrument (even a fixed-rate annuity!) could provide a yield that would reasonably exceed the interest expense involved in borrowing the funds.

 

There is no correct or right or wrong answer to any of this, and I am not advocating one approach over any other. It really depends on your understanding the numbers, how they work, and what works best for you, personally!

 

Terry

I would have to disagree with the statement that the bike would go into the asset column if using a home equity loan. Debt is a liability the only difference there would be if you defaulted you would be able to keep the bike but you would loose your house thats not an asset in my book.

[cmiles3]

Credit union here lists 5.25% interest rate on 72 month new car loans, dropping to 4.75% on 36 month loans. If there is a credit union near you, check it out. They generally accept members if you're not already a member somewhere else. Generally you have to set up a savings account, and maybe a share draft account (checking) to get the best rates. I know you can get pre-approved here.

 

Watch out if you finance through a dealer expecting to pay it off early with a credit union loan. I don't know if Yamaha's plan includes it, but there can be penalties (up to the total interest you would have paid for the life of the loan) for early repayment. So you end up paying the same $. And you still paid the dealer's finance fees, the loan company's finance fees, Yamahas finance fees, etc. Some states make the seller list all the fees, but who says they don't make "mistakes?"

[okscott]

Bought my RSTD on Yamaha Finance in May 7.99%. Then turned around refinanced with my CU at 5.99%. Yamaha's Financeing was GE Money Bank. Paid no pre-payment penalty.

[Blackjack]

I would have to disagree with the statement that the bike would go into the asset column if using a home equity loan. Debt is a liability the only difference there would be if you defaulted you would be able to keep the bike but you would loose your house thats not an asset in my book.

 

You are certainly welcome to disagree, Mike, but the comment I made is, technically, correct! Any item of value that is owned without direct debt or obligation is labeled and considered an asset.

 

If one chooses to use a home equity loan for any purchase, then the debt/obligation/risk against the property does clearly increase by the amount of that purchase. I hope I was rather clear to point out that all mathematical and financial options should be considered thoroughly so that one could make an informed choice based on what serves their own best financial interest.

 

Kindest Regards,

 

Terry

[ventureblue]

No credit unions here. Our states biggest employer is Walmart.

 

i think you can apply online or by phone. My sister did her loan over the phone from Navy 1st credit union. (Ithink thats the name) and 7.99 is pretty good if you can get it from them.