Looking at bikes is a brilliant past time, and if you’re looking to buy a new or used one, it’s even better! After test rides and visiting a couple of dealerships you’ve found the bike you want, but now you’re faced with different ways to buy it. Here we explain your options…

Cash

Straight forward cash purchases need no explanation really, you own the bike from the off, have no monthly payments or final payment and it’s all done and dusted.

Personal Contract Purchase

Best for riders who want lower monthly payments and like upgrading to a new motorcycle every few years.

Your dealer will push for finance through them due to the commission they can earn. Personal Contract Purchase or PCP involves putting down a deposit, paying a monthly payment (usually 12 to 60 months) and then in order to own the bike, you pay a final payment sometimes known as the balloon payment. Alternatively you can give the bike back to the dealer at the end of the monthly payments.

Pros

• Usually low monthly payments
• There are sometimes low APR deals to be had

Cons

• Annual mileage limit with excess mileage charges if it’s exceeded
• Depreciation – you could end up owing more than the bike is worth
• Unless you pay the final payment, you don’t own the bike
• Restrictions on servicing (usually as long as it’s done to the manufacturer’s schedule it’s fine and doesn’t necessarily need to be completed by the dealer)
• Restrictions on modifications
• Be careful of the dealer adding extras into the agreement that you may not want. Service plans, extended warranties and GAP insurance can appear. Ask to see the complete full finance breakdown.

Your bike could be worth more than the final payment by the end, especially if buying a used bike. Sometimes it’s worth saving up for the final payment, or even getting a personal loan to pay it off and either keep the bike, or sell it.

Hire Purchase

Best for riders who want to keep the bike long-term and prefer clear, predictable monthly costs without a large final bill.

You pay a deposit, then the rest of the cost of the bike and interest is divided into monthly payments over 12-60 months. There is a very small option to purchase fee at the end if you want to own the bike, usually about £10.

Pros

• There is no large final payment in order to own the bike
• No mileage limit

Cons

• You don’t own the bike until the agreement is complete
• Depreciation – you could end up owing more than the bike is worth
• Monthly payments tend to be higher than PCP
• Restrictions on servicing (usually as long as it’s done to the manufacturer’s schedule it’s fine and doesn’t necessarily need to be completed by the dealer)
• Restrictions on modifications
• Be careful of the dealer adding extras into the agreement that you may not want. Service plans, extended warranties and GAP insurance can appear. Ask to see the complete full finance breakdown.

Personal Contract Hire/Leasing

Best for riders who always want a brand-new bike with zero worry about resale value.

You rent the bike for a set period of time by paying an initial deposit and then monthly payments. You simply return the bike when the contract ends.

Pros

• You don’t have to worry about resale value
• There’s no final payment to pay at the end

Cons

• You don’t own the bike
• Restrictions on servicing (usually as long as it’s done to the manufacturer’s schedule it’s fine and doesn’t necessarily need to be completed by the dealer)
• Restrictions on modifications

Personal Loan

Best for riders who want maximum negotiation power as a cash buyer and flexibility over the loan length.

You use a bank or online lender for the loan and buy the bike outright from the dealer.

Pros

• You own the bike outright immediately
• No restrictions on modifications (laws allowing of course)
• No restrictions on servicing
• No final payment to pay
• More options available. Dealers tend to work with one finance company, whereas with a personal loan, you can shop around for the best deal.

Cons

• Can be higher monthly payments than dealer finance