Ducati Premier Financing
1 - 20 of 20 Posts
Joined
·
3,027 Posts
Years ago, back in the Netherlands, Honda would offer a similar plan where you would only pay off depreciation, and interest over everything you owe them.
Lets say you buy a $15,000.- bike, with a $5000.- trade in. They guarantee you for instance the bike's value will be 8000.- after three years. This means you only have to do down payments on (15,000 - 5,000) - 8,000 = $2,000.-
$2,000 divided by 36 (monthly payments) is only $55.56/month in down payments only
The interest however, is a different story. You are still paying apr x 3 years over the average debt you ow them, which in this example is 9,000.-
At 6% that is $1620.- (6% x 3 years over an amount of 9,000,-)
$1660 divided by 36 is another 45 bucks every month
And after three years you either have trade it in on a new model, or pay off the 8000.- you still owe them...
Something like this?
Lets say you buy a $15,000.- bike, with a $5000.- trade in. They guarantee you for instance the bike's value will be 8000.- after three years. This means you only have to do down payments on (15,000 - 5,000) - 8,000 = $2,000.-
$2,000 divided by 36 (monthly payments) is only $55.56/month in down payments only
The interest however, is a different story. You are still paying apr x 3 years over the average debt you ow them, which in this example is 9,000.-
At 6% that is $1620.- (6% x 3 years over an amount of 9,000,-)
$1660 divided by 36 is another 45 bucks every month
And after three years you either have trade it in on a new model, or pay off the 8000.- you still owe them...
Something like this?
Joined
·
3,027 Posts
True that. Many car dealers give a better discount when you use their "premium financing services". And they can, because in the end they get more from you through the loan than the discount they just gave you...
What is the APR Ducati offers if your credit score is over let's say 750?
![1-UNCLE+SAM+-+CONSUME+-+THEY+LIVE+-+HAL+HEFNER.jpg]()
(image courtesy of my neighbor and artist Hal Hefner)
What is the APR Ducati offers if your credit score is over let's say 750?
(image courtesy of my neighbor and artist Hal Hefner)
Yeah. Automakers make like triple the amount of money on financing than they do on the actual product they sell.
I'm not sure about all the specifics. I'm just dipping into my finance options right now as the possibility of actually getting one is a few months off at least. It's just something I found interesting and read a review that seemed to put it in a decent light. Of course cash is king and would be best option, but I prefer to drive my Ducati before 2020. So, finance is my option and cheaper payments for a fixed duration could be nice with the expectation of either a lump sum at the end, or a trade up to a new model.
I do it with my phone, I know I end up endlessly succumbing to consumerism by throwing myself in an endless cycle of monthly payments for my phone. But, I also get the newest one and am able to kind of be a little more "careless" with it as I know I'm going to get a new one next year. And by careless I mean wear it without a phone case to truly appreciate the product.
I don't wish to be in perpetual debt, or always financing/leasing a vehicle. Which is much more expensive than the phone. But, if it does open options to not only me, but others who thought they could maybe not afford a large monthly payment on something that is considered as luxurious as a motorcycle.
TLDR; I found it interesting they're offering something a little different and will at least be an option to throw in the maybe pile for a way to ride that sweet sweet Biscotti.
I do it with my phone, I know I end up endlessly succumbing to consumerism by throwing myself in an endless cycle of monthly payments for my phone. But, I also get the newest one and am able to kind of be a little more "careless" with it as I know I'm going to get a new one next year. And by careless I mean wear it without a phone case to truly appreciate the product.
I don't wish to be in perpetual debt, or always financing/leasing a vehicle. Which is much more expensive than the phone. But, if it does open options to not only me, but others who thought they could maybe not afford a large monthly payment on something that is considered as luxurious as a motorcycle.
TLDR; I found it interesting they're offering something a little different and will at least be an option to throw in the maybe pile for a way to ride that sweet sweet Biscotti.
Joined
·
788 Posts
I used Hire/Purchase to buy my last bike - Low (in my case 0%) rate finance loan, the bike is yours at the end.
For the Scrambler I have used Contract/Purchase - Through Ducati Tri-options in the UK.
As you've seen. I pay low monthly installments equaling roughly half the bike's value minus the deposit, with interest added on.
It's by no means the cheapest overall way to get the bike but it does make a bike more affordable each month. I tend to switch bikes every 2-3 years and I like having something new with a warranty (especially if it's Italian)
I'm in a decent stable job so I don't mind seeing it as a recurring monthly cost, just like my phone. I set myself a monthly limit and pay the lowest deposit possible. And for low monthly payments I can enjoy a brand new Ducati...
Where people go wrong with PCP is the deposit. People get sucked into trading in their current bike to get those monthly payments dead low. It makes no sense... Any money you put in is gone. Think of it as basically a rental. If I decide I'm going to keep the bike, I would just go to the bank at the end of the 3 years and take a loan to cover the final payment and continue paying a similar monthly fee.
Currently after 2 years, I've been offered what I still owe on it (1 years payments + final payment) on trade in and I'm looking to swap to something else. All I will have lost is the two years of payments. There aren't any Scramblers for sale with the mileage I've done (11k) but bikes with half that many miles are going for around £7k.
(The Scrambler has held it's value remarkably well, probably thanks to Ducati raising the price by £1000 in 2016)
So say I sell mine private, I might get close to £6k.That's 1k more than my settlement figure. Meaning I've lost £1300 a year. Not ideal but I can deal with that. That's about twice what my phone costs me annually...
I could perhaps plough whatever I get back into the next deal to lower the monthly on a more expensive bike. We'll see.
TLDR - It costs you more overall but means you can have a nice bike right now.
Good stuff Josh,
If I were to do like you said and just go to a bank for the "lump sum" at the end and continue paying until fully paid off. Would that really be much more interest/money lost than if I regularly financed it? Seems like maybe a little more since I would maybe be financing for a little longer, but like you said make the monthly payments more affordable.
I would like to say I'd do premier, pay very low payments, refinance with my bank until it's all paid off, boom got myself a new bike with very low payments that just took a little longer to pay off.
Although, being as addictive as bikes are, I might end up doing premier, pay low payments, trade in every 2-4 years
I also read something about 15% of the bike is due as a down payment? Was that true or can you really push yourself for a low as possible down payment, as you'll either be refinancing or trading in the bike anyway in a few years regardless of what your down payment is.
:dontknow:
I'm just getting into riding so this is going to be my first good bike. Currently riding a 1997 Honda Shadow; completely different.
Only way to get the Ducati would be finance for my situation, some say maybe I shouldn't get a bike because of that reason. But, life's too short so. Consumerism, 'Mercia, Fuck Yeah.
Understandable,As long as you go in to any deal with your eyes wide open and a good does of cynicism do what makes you happy.
Always read the small print
I'm okay knowing I will pay MORE than if I big balled it down to the dealer with a fistful of cash. But, again I couldn't afford to buy a house. Doesn't mean I should continue to rent. Total Apples to Oranges, as a bikes a total luxury. But, financing works for some. On another forum I read about the whole premier thing. And a guy pointed out if you play the stock market etc. Say you make 10% with the money you would've spent cash on then have a 2% rate, that's still a profit of 8% rather than spending all that money in one sum with no chance of recovery. Found it interesting is all, not that I'm playing the market currently. Something else to consider in the debate of finance Vs Cash I guess.
I see and respect both sides of it is all.
Joined
·
4 Posts
My mother always told me:
If you can't afford 2 Ferrari, don't buy 1.
If you can't afford 2 Ferrari, don't buy 1.
Joined
·
788 Posts
If you plan on keeping the bike beyond 37 months, I'm sure a more cost effective finance option would be to shop around for a bank loan for the full amount and just spread that over say, 5 years.
The risk to that is, if the bike depreciates a lot you could be in negative equity for a long time. Where you owe more than the bike is worth. Via Ducati finance, you have the guarantee of them laying a certain amount for it at the end.
Upside of Ducati's though, they hold value fairly well. Depending on the model. Going to be a lot of scramblers around in a year or two. Bare that in mind. They are still currently sparse on used market.
5 years is a long time but will keep monthly payments down. Also, larger bank loans tend to have very good interest rates if you have a decent credit rating.
Ducati finance interest is pretty good though. As low as 4% on some models but best to get a quote from both options and compare...
The deposits seem to work off tiers. I could pay £500 on the Scrambler but minimum for bikes like the Hypers or Suspersport is £1000. I'm guessing elite stuff like XDiavel or Panigale might even be more. So I'm assuming the asking price affects the minimum deposit.
Ultimately, financing costs but unlike the majority of Ducati owners around this place, I don't have a Panigale or Multistrada sitting about or enough money to buy new bikes outright. I definitely don't have the inclination to save up for a couple of years... some tool in a Volvo might have me before then!
Joined
·
149 Posts
Wait until the fall and Ducati will probably offer 0% financing on 2017/2016 left overs. I picked up my 2016 UE last november 0 down 0% financing, $192/month. I would have put more down but with 0% interest there's no point so i keep the cash and pay a little every month.
Joined
·
157 Posts
It feels ill-advised to me unless a person 'purchases' the bike and chooses not to do any sort of mods to it, and uses it almost solely for long mile commuting. We all like to personalize our rides, and when the bike has to be returned (if you do not buy it), all those parts go with the bike unless you bother to take them off. Further, depending on the contract it may require the bike to remain in more or less stock shape. That also may affect utility of this program. In essence this is a perpetual lease, and if a person chooses to not own, it does not look very appealing.
I plan to wait until fall/winter to get the bike and hope to swoop on a good deal. Only going to pull the trigger on something that's a good deal, within my budget, and ultimately make me happy.
I'll talk pretty extensively about the program with the dealer vs regular financing to see if ot fits my needs
I'll talk pretty extensively about the program with the dealer vs regular financing to see if ot fits my needs
Joined
·
3,027 Posts
^^ this!
1 - 20 of 20 Posts
Join the discussion
Join now to ask and comment!