What do you guys think of finance?

LeighBartolo
Edited Date/Time 4/18/2017 5:55am
Hey riders,

I'm looking at getting an enduro bike—KTM 500 EXC. I took a couple photos of what was advertised, since I've never bought brand new I was looking to get some advice from more experienced people.

NOTE: I live in Australia.





**EDIT** I'm blown away by the amount of helpful responses. Thank you to everyone who has taken the time to give all the amazing advice you have!!
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kkawboy14
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kkawboy14 4/14/2017 1:44am
4/14/2017 1:44am
$300 a month for 60 months? Are these guys loan sharks? How much does that bike cost new?
kyle173
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kyle173 4/14/2017 2:00am
4/14/2017 2:00am
kkawboy14 wrote:
$300 a month for 60 months? Are these guys loan sharks? How much does that bike cost new?
In Australia thats about average. 12% comparison hunt around your bank might even beat that. Also 15k for a 500exc is alot of coin a gsxr750 is less then that.
kyle173
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kyle173 4/14/2017 2:01am
4/14/2017 2:01am
kkawboy14 wrote:
$300 a month for 60 months? Are these guys loan sharks? How much does that bike cost new?
Ill give u a hint on prices over hear for 2 kids in day care 5 days a week is $35 000 a year $52 000 before the goverment gives u a rebate.
sgrimmxdad 4/14/2017 2:04am
4/14/2017 2:04am
Its 10% APR... Not a bad rate for this type of financing. Total of payments from that sign would be $18,864, with a buy it now price of $15,395. $3469 in finance charges over 5 years.... Better than most Honda deals I have seen...

The Shop

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LeighBartolo 4/14/2017 2:13am
4/14/2017 2:13am
kkawboy14 wrote:
$300 a month for 60 months? Are these guys loan sharks? How much does that bike cost new?
$15,395 new.
Plugga
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Plugga 4/14/2017 2:16am
4/14/2017 2:16am
Save up, pay cash and haggle.

Flip109
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Flip109 4/14/2017 3:30am
4/14/2017 3:30am
I think I'd go buy me a clean used bike for 1/3 the cost. New bikes are outrageous these days.
MudPup545
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MudPup545 4/14/2017 4:13am
4/14/2017 4:13am
It's your money. And nobody here knows your personal financial situation. If you've crunched the numbers and can afford it, go for it. Enjoy the new bike if you decide to go that route.
chump6784
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chump6784 4/14/2017 4:30am
4/14/2017 4:30am
There is nothing wrong with getting finance if you are smart about it. In my opinion it is actually good to have some history of paying back loans before you go for a mortgage.

One thing to check is if there is any early payout fee's on the loan. Most finance companies will have an early payout figure so that if you pay the amount off early you have to give them the interest they missed out of or at least a percentage of it. If you go to a bank or credit union and get a personal loan most of the time there will be no early payout amounts, at least not the places I have dealt with anyway

Bike shops will usually make you jump through less hoops than a bank but really look into their fee's.

My advice would be to look into a personal loan from bank/ credit union then rock up to the bike shop with cash in hand. That should get you a better deal on the price of the bike and should be as good or better deal on the finance. Once you get the finance pay it off as quickly as you can, it saves you interest and looks good for later on.

305FC250
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305FC250 4/14/2017 4:33am
4/14/2017 4:33am
Nowadays if you want a brand new bike the vast majority of people will need to finance, which I think is totally fine. Bikes are not cheap. The big thing though is I would aim to pay it off as quick as possible and definitely not take the whole 60 months.
smoothies862 4/14/2017 4:51am
4/14/2017 4:51am
from a money master. not me. if you cant pay a car,bike,boat etc. off in 2 yrs. you cant afford it.
home is another animal.
LeighBartolo 4/14/2017 4:57am
4/14/2017 4:57am
chump6784 wrote:
There is nothing wrong with getting finance if you are smart about it. In my opinion it is actually good to have some history of paying...
There is nothing wrong with getting finance if you are smart about it. In my opinion it is actually good to have some history of paying back loans before you go for a mortgage.

One thing to check is if there is any early payout fee's on the loan. Most finance companies will have an early payout figure so that if you pay the amount off early you have to give them the interest they missed out of or at least a percentage of it. If you go to a bank or credit union and get a personal loan most of the time there will be no early payout amounts, at least not the places I have dealt with anyway

Bike shops will usually make you jump through less hoops than a bank but really look into their fee's.

My advice would be to look into a personal loan from bank/ credit union then rock up to the bike shop with cash in hand. That should get you a better deal on the price of the bike and should be as good or better deal on the finance. Once you get the finance pay it off as quickly as you can, it saves you interest and looks good for later on.

Thank you so much dude!
GoonSquad250x 4/14/2017 5:34am
4/14/2017 5:34am Edited Date/Time 4/14/2017 5:49am
LeighBartolo wrote:
Hey riders, I'm looking at getting an enduro bike—KTM 500 EXC. I took a couple photos of what was advertised, since I've never bought brand new...
Hey riders,

I'm looking at getting an enduro bike—KTM 500 EXC. I took a couple photos of what was advertised, since I've never bought brand new I was looking to get some advice from more experienced people.

NOTE: I live in Australia.





**EDIT** I'm blown away by the amount of helpful responses. Thank you to everyone who has taken the time to give all the amazing advice you have!!
So last year I wanted to get a dual sport bike really bad. I already had a YZ450F that I paid cash for that was used. I was in no position to shell out another $3-5k for a used dirtbike since we were looking to move into a house this year and we had our baby in November. So after talking to my buddy that was the sales manager at Mountain Motorsports, I decided I was going to finance my first new dirtbike. It never really crossed my mind to go finance a new bike because I always paid cash for them, but at this point I was making good money and able to treat myself for once! I traded in two of our four wheelers for a down payment and didn't spend a penny out of pocket. I got a good deal on a leftover 350exc and have been happy with my choice every sense. Those bikes hold their value really well, so if I were to ever get into a pinch and need to get out from under it, I'm sure I could sell it within a reasonable time. But that's one payment I do not mind making every month because I love having a bike that was brand-new! If you can afford it and you want to new bike, go for it. It's your money and if you want to treat yourself that's your prerogative.
JBecker 72
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JBecker 72 4/14/2017 5:43am
4/14/2017 5:43am
I financed my YZ250 and paid it off in 2.5 years. Probably gonna finance my new KX450 as well. Put some down and finance the rest for 36 months.
1stSSPZ
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1stSSPZ 4/14/2017 5:47am
4/14/2017 5:47am
That right there is why I ride a 13 year old (04 RM250) 2-stroke. I MIGHT go a second or two faster on a new 450, but damn...
TJMX947
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TJMX947 4/14/2017 6:09am
4/14/2017 6:09am Edited Date/Time 4/14/2017 6:11am
Are those figures in US Dollars? I got in deep water financing new bikes when I was in college.

After I graduated in 2008 and couldn't find a job the crows came home to roost. In 2012 I decided that I was never going to make a payment on a dirt bike again. I sold the bike I had and paid off the loan. Saved for 6 months and bought a cherry 2008 YZ250 two stroke for $2300.

If you're going to finance a toy, a KTM is the way to go. I know guys who would give one of their first born's kidneys away for a 2016+ KTM 250/350/450 SXF.
APLMAN99
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APLMAN99 4/14/2017 6:28am
4/14/2017 6:28am
chump6784 wrote:
There is nothing wrong with getting finance if you are smart about it. In my opinion it is actually good to have some history of paying...
There is nothing wrong with getting finance if you are smart about it. In my opinion it is actually good to have some history of paying back loans before you go for a mortgage.

One thing to check is if there is any early payout fee's on the loan. Most finance companies will have an early payout figure so that if you pay the amount off early you have to give them the interest they missed out of or at least a percentage of it. If you go to a bank or credit union and get a personal loan most of the time there will be no early payout amounts, at least not the places I have dealt with anyway

Bike shops will usually make you jump through less hoops than a bank but really look into their fee's.

My advice would be to look into a personal loan from bank/ credit union then rock up to the bike shop with cash in hand. That should get you a better deal on the price of the bike and should be as good or better deal on the finance. Once you get the finance pay it off as quickly as you can, it saves you interest and looks good for later on.

Bikes might be different, but usually auto dealerships would much rather finance than having a cash buyer. With financing a dealer makes a portion of the finance charge, they can usually upsell a few high margin items (gap insurance, etc), and the buyer is usually more payment focused than actual price focused.

Also with an item of that price I think it's over the threshold where you have to fill out all that extra "anti money laundering" paperwork that no one ever seems to know how to fill out correctly........

r.sal923
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r.sal923 4/14/2017 6:28am
4/14/2017 6:28am
Some would say it is a rip off. Me personally , I would say it is not. I have had 20 or so new bikes over the years and have been paying 150-175$ a month since 2002 on bike payments. The first bike I have ever owned is my current 450. For me there is no way I could ever save 8000-10000 Canadian dollars . With out financing I would never have been able to afford bikes and not been able to ride. 150-175 a month to have a fresh bike to ride every time I ride is money well spent I think, every one knows how much it sucks to have a 1500$ clapped out p.o.s broke down at track or in the woods. sure I have paid lots of money over the years and lost selling bikes that I owe mor on then they are worth. I just chalk it up as money well spent on something I enjoy doing.

Pit Row

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Question 4/14/2017 6:47am
4/14/2017 6:47am

I love our financial system because it has helped occident to become the rich world.

However there are always bad pupils in a classroom that make this whole industry finger pointed often: the "total amount" of 15896 is not right so they deserve a slap from the authorities for false advertising, lack of transparency, confidence abuse etc (whatever charges applicable locally). People must know exactly what the cost is, I thought it was also like that in Australia.
BlueTrailblazer 4/14/2017 6:55am
4/14/2017 6:55am
Never finance anything with an engine. Borrowing money at X interest rate to invest in something that is 100% guaranteed to GREATLY depreciate in value is not a smart move, but making that a habit is a good way to stay poor your entire life. Pay off other debts first (if you have any) other than your house, then save up and buy a bike with cash. You will be amazed how fast you can save money when you have no payments.
500guy
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500guy 4/14/2017 7:04am
4/14/2017 7:04am
Getting a loan for a toy is a horrible decision ,

Don't take bad advice on Finance, do a little research on money and personal finance.
500guy
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500guy 4/14/2017 7:05am
4/14/2017 7:05am
BlueTrailblazer wrote:
Never finance anything with an engine. Borrowing money at X interest rate to invest in something that is 100% guaranteed to GREATLY depreciate in value is...
Never finance anything with an engine. Borrowing money at X interest rate to invest in something that is 100% guaranteed to GREATLY depreciate in value is not a smart move, but making that a habit is a good way to stay poor your entire life. Pay off other debts first (if you have any) other than your house, then save up and buy a bike with cash. You will be amazed how fast you can save money when you have no payments.
Amen to that.

Dave Ramsey would give you an A+
Panic_Rev
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Panic_Rev 4/14/2017 7:08am
4/14/2017 7:08am
500guy wrote:
Getting a loan for a toy is a horrible decision ,

Don't take bad advice on Finance, do a little research on money and personal finance.
This all the way!

Myke
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Myke 4/14/2017 7:10am
4/14/2017 7:10am
1stSSPZ wrote:
That right there is why I ride a 13 year old (04 RM250) 2-stroke. I MIGHT go a second or two faster on a new 450...
That right there is why I ride a 13 year old (04 RM250) 2-stroke. I MIGHT go a second or two faster on a new 450, but damn...
This is why I ride an '08 Honda 450 as well. I also don't think I would be faster on a new bike.
tprice07
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tprice07 4/14/2017 7:10am
4/14/2017 7:10am
Uhm....take what you have in cash, go buy that bike. No way a used bike is going to be ridden to its full potential by 90% of riders. You can probably find a bike that is a few years old with a bunch of after market parts for a lot less.

Plus that interest rate sucks.
Sheriff245 4/14/2017 7:28am
4/14/2017 7:28am
I have personally have always been against financing toys (cars and houses only), but I must admit I financed my current bike. I had the cash to pay it outright though, and went with financing because the interest rate vas very low (under 3%) and I could get more than that through investments.

I wouldn't guess it at nearly 10% interest though. I understand why prices are higher in Australia, but those rates are just crazy. I would pay the bike cash or get a good used one, or shop for a better rate through a bank or credit union.
JBecker 72
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JBecker 72 4/14/2017 7:45am
4/14/2017 7:45am
The whole "never finance a toy" thing is kind of silly to me. You can finance something at a good interest rate and be perfectly fine. If you're paying a low interest rate it's not a bad deal. If you're financing something at 15% interest for 7 years, well that's a bad deal. But a short term loan on a few thousand with a down payment at 4-6% for 3 years isn't a poor financial decision in my opinion.
agn5009
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agn5009 4/14/2017 7:59am
4/14/2017 7:59am Edited Date/Time 4/14/2017 8:02am
r.sal923 wrote:
Some would say it is a rip off. Me personally , I would say it is not. I have had 20 or so new bikes over...
Some would say it is a rip off. Me personally , I would say it is not. I have had 20 or so new bikes over the years and have been paying 150-175$ a month since 2002 on bike payments. The first bike I have ever owned is my current 450. For me there is no way I could ever save 8000-10000 Canadian dollars . With out financing I would never have been able to afford bikes and not been able to ride. 150-175 a month to have a fresh bike to ride every time I ride is money well spent I think, every one knows how much it sucks to have a 1500$ clapped out p.o.s broke down at track or in the woods. sure I have paid lots of money over the years and lost selling bikes that I owe mor on then they are worth. I just chalk it up as money well spent on something I enjoy doing.
This is horrible advice. OP, please do NOT listen to this guy. Everything he has said is utterly stupid.

The reason you can't afford to save up the cash to purchase a bike is because you have had $200 per month payments on dirt bikes since 2002.

Don't finance a bike. I don't finance anything other than my house and my wife's car and the only reason we finance her car is because we got it at 0% APR. My theory is, if it's a toy I pay cash. It blows my mind that guys who can't run down to their checking or savings account and pull out 3 grand for a nice used bike because they don't have to funds to do so have no problem running down to the bank and taking out a $12,000 loan for a toy. That is crazy. You never know when your next life emergency may happen and if you have no money in the bank you're screwed. Back to the bank for another loan to buy a hot water tank, now you've got a loan for a water tank and a bike. Washer goes out. Oh shit, another loan on top of that. Stove stops working..... I think you see what I'm getting at here.
agn5009
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agn5009 4/14/2017 8:07am
4/14/2017 8:07am
JBecker 72 wrote:
The whole "never finance a toy" thing is kind of silly to me. You can finance something at a good interest rate and be perfectly fine...
The whole "never finance a toy" thing is kind of silly to me. You can finance something at a good interest rate and be perfectly fine. If you're paying a low interest rate it's not a bad deal. If you're financing something at 15% interest for 7 years, well that's a bad deal. But a short term loan on a few thousand with a down payment at 4-6% for 3 years isn't a poor financial decision in my opinion.
If you finance a large purchase such as a car under 2% it's not a poor financial decision.

If you have to take out a loan for a couple thousand dollars at 4-6% then you've probably already made a bunch of poor financial decisions which is resulting in you needing to borrow a few thousand dollars to buy something to begin with.

I'm not trying to be a dick, but please take a financial course such as one put on by Dave Ramsey. If there aren't any in your area, purchase a few of his books off of Amazon and read them. They can really improve almost anyone's finances.
doghouse
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doghouse 4/14/2017 8:31am
4/14/2017 8:31am
The financial gurus in here are hilarious.

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