Buying a dream motorcycle can be an exhilarating experience for automobile enthusiasts. Although the purchasing process may seem easy, the financial aspects – mainly the down payment – can be a major barrier for many people. Many dealers or lenders ask buyers to pay an upfront deposit amount while buying a motorcycle. Fortunately, there are ways Filipinos can buy their motorcycle without paying the downpayment, like seeking zero-down payment loans, taking secured loans, and more.

Taking loans from friends and family

One of the easiest ways to receive finances to cover the down payment of a motorcycle is to request money from one’s family or close friends. Unlike banks and other private or public lenders, a person’s friends and family members will be more flexible with repayment terms and won’t regulate every aspect of where the money is being spent. So, one can use this money to cover the down payment costs of their dream motorcycle. From there onwards, they can start with the installment payments needed to secure the motorcycle purchase. It is important that motorcycle buyers repay the loan, including any interest, to show gratitude for the help they received from their family or friends. 

Securing a loan from one’s friends or family is ideal since it eliminates the need for any collateral attached. Therefore, borrowers will not lose their belongings if they fail to repay their loved ones on time. Besides, one’s family or friends won’t be interested in one’s credit score or creditworthiness. Due to all these reasons, paying the downpayment for one’s dream motorcycle with the help of one’s friends or family is the safest choice.

Seeking out zero-down payment loans

Lenders and financial institutions provide loans for all kinds of vehicles, including motorcycles. Certain motorcycle loans come with the possibility of zero deposit or down payment. This means buyers do not have to pay an upfront deposit; the loan covers that. Instead, the buyer has to pay the full amount (deposit + installments) periodically through staggered payments.

In many cases, motorcycle dealerships partner with banks and other financial institutions to simplify purchases by offering buyers the option of buying motorcycles without a down payment. In most cases, the loans offered by such institutions cover the entire cost of the motorcycle, leaving buyers free of the worry of down payments. However, buyers must inquire about such deals before making a decision.

While zero down payment financing can seem convenient, it is important to consider some crucial factors. Firstly, the repayment interest rates of such financing options are almost always high. Comparatively, loans with down payments come with lower interest rates. Also, the loan terms of these loans are longer to cover the entire cost of the motorcycle and the interest amounts. This compensates for the lack of a down payment for the motorcycle purchases. Nevertheless, this means motorcycle buyers spend several more weeks or months paying installments to the financier until the total cost and interest amounts are covered. Also, the availability of this financing option is limited. Not many lenders offer zero down payment loans for bike purchases, and even those that offer this option may have very high credit score requirements. Lastly, it is important to note that these loans may come with several hidden charges that will be added to the repayment amount without the motorcycle buyer’s knowledge. Examples of such charges include origination fees and processing fees.

Taking personal loans

Personal loans offer some much-needed financial boost to people with a momentary cash crunch. They are especially handy for those who need motorcycle financing with a low credit score or the option of purchasing motorcycles without down payments. These loans are usually multi-purpose, low-interest financing options that come with affordable payment terms and installments for buyers. Buyers can use personal loans to cover the cost of down payments for motorcycle purchases anywhere in the Philippines.

While personal loans offer great flexibility for buyers, it is important to consider certain factors before choosing them to finance one’s motorcycle. 

As is the case with every kind of financing option, even this one has a few downsides for buyers. The creditworthiness requirements of personal loans tend to be on the higher side. Banks and other lenders offering these loans may have strict credit score requirements to ensure their borrowers’ repayment credibility.

Taking unsecured loans

Many credit card companies and banks offer unsecured loans to borrowers. As the name implies, these loans eliminate the need for any collateral. So, people who use these loans to purchase motorcycles on credit without down payments will not risk losing their valuable assets if they cannot repay the installments on time. These loans are based on one’s credit history and ability to repay, so an individual must have a high credit score to get these.

Taking secured loans

Secured loans are often backed by collateral. Therefore, if one doesn’t repay the loan installments on time, they risk losing their valuable asset. However, it is important to note that such loans are easily accessible, and the credit score requirements levied by lenders giving out these loans are more flexible when compared to alternatives.