Motorcycle financing in Canada

If you’ve decided to buy a motorcycle, finding the right loan is important. Don’t let a loan with high APRs and mountains of fees get in the way of your next two-wheeled adventure. Instead, compare your motorcycle financing options to find the best terms for you.

Can you finance a motorcycle in Canada?

Yes, much like getting a car loan, there are a few different ways you can get the money for motorcycle financing in Canada. The best option for you will depend on your financial situation and credit, which impact the interest you’re given and the amount your lender is willing to give you. Here are the different options you can explore when it comes to motorcycle financing.

• Dealership financing. Many dealerships that sell motorcycles offer financing. It could be a good option if you haven’t been able to qualify for a loan elsewhere, or you just want to keep things in one place.
• Manufacturer financing. Manufacturers also offer financing for their motorcycles online or at a manufacturing store. However, you might not get the best deal on interest rates or loan terms when you choose this route.
• Online lenders. Some online lenders that offer car loans also allow you to use your funds for motorcycles and other related costs like licensing and registration.
• Bank and credit union loans. Some offer recreational vehicle loans, which typically come with more competitive rates, though it can take longer to process the application.
• Personal loans. You can use a personal loan to finance just about any purchase, including a motorcycle.

How much do motorcycles cost?

The first step to comparing your motorcycle financing options is to figure out how much you need to spend. A motorcycle’s cost can vary a lot depending on whether it is new, used, high-performing or beginner-friendly. Used bikes start at a few thousand dollars, while a brand new bike could cost you anywhere between $5,000 to over $40,000. Beginners will likely spend between $7,000-$12,000. Luxury rides can cost hundreds of thousands of dollars, with some coveted bikes even topping $1,000,000.

The models below have been cited as some of the must-rides of the year. Keep in mind that both the MSRP (manufacturer’s suggested retail price) and the destination charges are flexible, so your actual price will vary. (Destination charges cover the cost of shipping the motorcycle to you and can cost anywhere south of $400 to well over $1,000.)

Model	MSRP (CAD)
2022 BMW G 310 GS	$5,945
2022 Honda CRF450RL	$12,299
2022 BMW R 1250 GS	$17,995
2022 Harley-Davidson Fat BoyTM 114	$24,999
2022 Ducati Panigale V4 R	$47,995
2022 Kawasaki Ninja H2R	$62,700

Representative example: Logan finances a motorcycle

Now that he has an M Class license, Logan, a resident of Ontario, can ride a motorcycle. First, though, he needs to buy a bike. After doing some research, Logan heads to a nearby dealership, where he finds a 2020 Honda CB300R priced at $4,950.00. Logan makes a 10% down payment of $495.00 and heads to his local bank to get motorcycle financing to cover the remaining $4,455.00 + $643.50 HST on the purchase price.

Because Logan has a solid credit history, he is approved for a $5,098.50 motorcycle loan with competitive terms. Along with the cost of his loan, he also pays around $180.00 to register his bike with the province of Ontario – this includes the cost of license plates, a sticker and a vehicle permit.

Cost of new car	$4,950.00
Loan type	Auto loan (term loan)
Loan amount	$5,098.50
Interest rate (APR)	4.90%
Loan term	3 years
Additional fees	4.00% origination fee ($203.94)
Payment	$152.58 monthly or $70.35 biweekly
Total loan cost	$5,492.88 with monthly payments or $5,487.30 with biweekly payments

*The information in this example, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.

How do I choose the right motorcycle financing?

While deciding between every option for motorcycle financing in Canada can be difficult, asking yourself these questions can help make your choice easier.

• What loan amount do you need? Check the minimum and maximum loan amounts set by lenders when comparing your motorcycle financing options and only borrow as much as you need.
• What is the loan term? Motorcycle loans typically last two to three years. You might be able to find financing as long as five years, but this may depend on the model you’re buying. You can use our monthly payment calculator to see how the length of your loan term affects your monthly payment.
• Do you qualify for a secured or unsecured loan? Secured loans use your motorcycle as collateral to protect the lender in case of default. Unsecured loan, on the other hand require a healthy credit score and can offer larger loans with flexible payments.
• What interest rate will you get? Your interest rate is determined by your credit history and whether you choose a fixed or variable loan. Variable rates fluctuate with the prime lending rate (which may go up or down at any given time), while fixed rates are set for the life of the loan.
• What fees will you pay? Lenders may charge fees either upfront or throughout the loan term to keep the loan active. Read the fine print and terms of your loan before you sign on the dotted line.
• Can I make extra payments and pay back the loan early? One way to bring down interest on your loan is to make extra payments when you can afford it. If you feel like you’ll be able to pay back the debt early, make sure your lender allows this or doesn’t charge any fees.

Calculate how much motorcycle financing could cost

Your payments should not only fit within your short-term monthly budget, but also within your long-term financial plans as well. Before you apply for motorcycle financing, think about what you can realistically afford. Smaller payments will stretch out the length of the loan, but a shorter loan term will make your payments larger.

• How to use this motorcycle financing monthly payment calculator

  1. Enter the amount you want to borrow to buy a motorcycle under Loan amount. This might not be the same as the cost of your car, since many lenders require a down payment.
  2. Write the amount of time you have to pay off your car loan under Loan terms (in years). If your loan term is in months, divide it by 12 first.
  3. Enter the interest rate you expect to pay on a car loan under Interest rate. If your car loan comes with fees, enter the annual percentage rate (APR) instead.
  4. Click Calculate.

  In addition to your monthly payment, this calculator shows how much you’d pay on your loan’s principle amount and how much you’d pay overall in interest. The principle amount is the amount that you borrowed and should be equal to your loan amount. Total interest is the amount you would pay on top of the principle — the cost of having your loan.

5 tips to help buy the right motorcycle

If you’re going to lock yourself into a motorcycle financing contract, keep the following 5 tips in mind to make sure you’re getting the right ride for your budget and wish list.

1. Know the type of motorcycle you want

There’s a bike out there for everybody: Harley Davidson for cruisers, Ducati if you’re looking for speed, BMW touring bikes for longer travelers and scooters for getting around the city.

2. Check out the strength of the engine

When looking at motorcycles, consider your skill level and the number of CCs the engine has. “CCs” stand for cubic centimetres and describes the volume of air and fuel the cylinders in the engine can suck in at once to pressurize, combust and make the motorcycle move. A higher number of CCs means a bigger engine and a smoother, more powerful ride, although the weight of the bike can offset the power produced by the engine. Motorcycles with higher CCs (generally between 1000cc and 1600cc) are suited for skilled riders — if you’re just starting out, 250 CCs should be fine.

3. Decide if you want a new or used motorcycle

Consider the long-term commitment and if you’ll be riding for the foreseeable future. If you’re buying your first motorcycle, consider buying a used bike and then upgrading when you’re sure it’s a hobby that you’ll stick with.

4. Test drive your motorcycle

Similar to when you buy a car, take the bike for ride before you buy it. Think about how well it handles, the acceleration and whether there are any weird noises.

5. Look up the motorcycle’s title and service history

By reviewing the title history, you can determine if there have been any recalls or major complaints regarding the make and model that you’re looking at. The service history can provide you with a detailed list of maintenance to ensure the motorcycle was properly maintained. Most of this information can be obtained by conducting a VIN (vehicle identification number) search for a fee (usually $10-$50) with reporting companies like CARFAX or Vehicle Check Canada, or for U.S. title and service reports, companies like VINCheckUp or the NMVTIS.

Make sure to verify whether you’re living in a region in which vehicles are required to pass a vehicle emissions test. If so, contact your provincial government to verify the bike’s emissions testing history, and make sure it’s up to code. Otherwise, you might be saddled with the cost of making sure that your bike is compliant.

See our full guide to buying a motorcycle

Am I eligible for motorcycle financing in Canada?

Eligibility criteria will differ between lenders, but in general, you have to meet these four basic points to be considered eligible for motorcycle financing:

• You must be at least the age of majority in the province or territory in which you live (either 18 or 19 years old)
• You must be a Canadian citizen or permanent resident
• You must have a good to excellent credit score, ideally, at least a 650
• You usually have to provide proof of income or at least have a cosigner who can provide proof of their income; proof of income is especially helpful if you have no credit score or a below-average credit score

Although having a good credit score is really helpful, you still have loan options even if your score is low.

How do I apply for motorcycle financing?

As with the eligibility criteria above, the exact motorcycle financing application steps vary by lender. However, most lenders in Canada will require the same basic information no matter what type of loan you’re applying for. (Note: the examples in this list are just suggestions. Check with your lender for an exact list of the information that you need to apply for a loan.)

• Social Insurance Number (SIN card) and valid, government-issued photo ID
  Example: Driver’s License, Passport, or Permanent Resident Card
• Personal information
  Example: phone number, home address, proof of residency (utility bill, phone bill, bank statement etc.)
• Employment details and income information
  Example: Your most recent pay stub, or employment tax forms along with your Notice of Assessments from the last 2 years. For self-employed people: financial statements prepared by a CPA (Certified Professional Accountant), tax documents such as your Notices of Assessments and T1 or T2 forms for the past few years, bank statements, ledger information etc.
• Assets, debts and liabilities and any other financial details
  Example: investments, real estate ownership, other loans including student loans, credit card debt
• Registration details of the bike you intend to buy (can be obtained from your dealership unless it’s a private sale)
  Example: make, model, VIN, dealership information and your driver’s license, among other pieces of information.

What other costs will I need to consider when buying a motorcycle?

The cost of a motorcycle, like any vehicle, isn’t limited to the purchase price. You’ll have to consider how much it costs to use your bike while also calculating the upfront costs.

• Insurance

Every Canadian province requires motorcyclists to purchase insurance covering third-party liability, accident benefits and uninsured automobile coverage. You have the option to purchase additional coverage for things like theft, fire and other natural disasters. Motorcycle insurance is not the same as car insurance and must be purchased separately. Compare insurance options from multiple companies and remember to factor this cost into the purchase of your bike. The cost of your policy can vary greatly based on which province you live in, with some policies differing by as much as $1,000 or more!

Ontario is the most expensive province in which to buy motorcycle insurance because of the high rate of accidents that occur among drivers living there. Insurance policies can cost under $1,000 to several thousand dollars per year. You’ll be charged a higher rate if you’re young and/or driving a more powerful bike.

Besides your location, other factors affecting the cost of your insurance policy include:

• Licensing and registration

Getting a motorcycle license costs vary by province, ranging from under $100 to several hundred dollars in total (Saskatchewan charges $1500 for a full motorcycle license, but the fee is waived if motorcyclists show proof that they completed a government-approved training course.) You’ll need to register your motorcycle with your Provincial Ministry of Transportation. In most provinces, registration usually costs around $50. There may be other fees for renewing your license, getting a new plate and other incidentals.

Provinces have different laws on how much time you have to register ownership of your vehicle after purchasing it, so make sure you know how much time your province allows and be sure to register before then.

• Riding gear

You can’t go out on a motorcycle in just flip flops and shorts. To remain safe while out on the road, you’ll need to pay for gear. Helmets, leather jackets and sturdy boots are all part of the cost involved in getting a motorcycle.

The total cost of these items may surprise you, but it’s not unusual for bikers to spend between $500-$1,000 on a helmet, jacket, pants, boots and gloves, even when they’re just getting started.

Bottom line

Motorcycles are a great way to get out on the open road, but many models cost more than a lot of riders can reasonably afford out-of-pocket. If this is the case for you, then getting motorcycle financing in Canada could be your answer. Browse your loan options to see what kind of terms are available.

Frequently asked questions about motorcycle financing

• How long can motorcycles be financed?

  Motorcycles can typically be financed for anywhere from 2 years up to 5 years. The financing term length you’re offered will depend both on the type of motorcycle you’re buying and your personal financial situation.

• Should I lease or buy my next motorcycle?

  It depends. It comes down to your financial situation and your ability to manage the loan. Leasing is essentially a long-term rental agreement in which you only pay for the amount of value the vehicle is expected to lose by the time the lease is up – warranties usually cover a lot of the maintenance and you can swap the motorcycle for another good vehicle when the lease is up.

  If you buy a motorcycle, you are responsible for the full purchase price of the bike plus all maintenance costs, so your monthly payments are higher. The trade-off is that you will eventually pay off the bike and not have to make any more payments (unless you get a new bike worth more than the value of your old one).

  Are you willing to make never-ending payments on a motorcycle to be spared the costs and trouble of being a bike owner? Or do you think the promise of a future without loan payments is worth paying higher monthly payments for a few years as well as risking higher maintenance costs?

• I was offered 0% motorcycle financing. Is this legit?

  While 0% interest sounds temping, always read the fine print and compare your options. There could be a catch like a limited term in which you’re charged o% interest before your payments drastically increase. Click here to learn more about 0% financing.

• I have bad credit. Can I still get motorcycle financing?

  It depends. There are lenders that lend to those with bad credit, but with high APRs (annual percentage rates). There are options for cash loans even if your credit score is low. You may even qualify for a loan of up to $5,0000.

  How to improve your credit score

• Can I get a loan to buy a scooter?

  Yes. Lenders offer financing to purchase scooters. These loans are typically unsecured, meaning the scooter won’t be used as collateral.