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Discussion Starter #1
hi everyone,

Have you ever analyzed/evaluated the “Premiere Financing” being offered by Ducati / 3asy Ride offered by BMW?

From what I understood from the website and a call to the local dealer it works like a lease, where you pay a monthly during 36/48 months and have a “ballon payment” in the end of the term IN CASE you want to keep the motorcycle. If after that period you decide to sell the bike, or trade-in for a new one, you’d follow the normal process for a trade-in/sale.

The APR is not great, doesn’t compare to the normal financing (way higher), but it makes the monthly payments quite attractive. You do have the risk of the bike’s value being below your ballon payment, specially if the bike is not in good conditions, but the same can be said for a car lease where you’d be charged for “wear and tear” at the return moment.

What do you think about this program? Anyone has experience, or know someone who had experience with it?
 

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The cons of buying a vehicle are minimal and accepted as a typical cost of our daily life by most people. Leases are cheaper in the short term, but in the long run, purchasing a vehicle is typically less expensive. Weighing the pros and cons will help you come to the decision that is right for you . I save and buy cash as I don,t like monthly payment ,cause its like someone own you.
 

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Discussion Starter #3
The risk as I understand is selling your bike at the end, you might either not receive a decent appraisal from whatever stealer you're trading it in or have to go thru the process of selling it to a private part.
 

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If the payment covers the depreciation and in the end you can walk away and you will ride enough miles to justify the monthly payment then you can look at it the same way as paying for internet, cable TV. Smart Phone service, or other entertainment expense.

If you are the type that gets attached to a bike, or want to modify it to make it your own then this is definitely not a good option.

If you are looking at this because it is the only way you can afford a Duc or BMW then you are better off getting a used Japanese bike that has a low cost to own.
 

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Discussion Starter #5
If the payment covers the depreciation and in the end you can walk away and you will ride enough miles to justify the monthly payment then you can look at it the same way as paying for internet, cable TV. Smart Phone service, or other entertainment expense.

If you are the type that gets attached to a bike, or want to modify it to make it your own then this is definitely not a good option.

If you are looking at this because it is the only way you can afford a Duc or BMW then you are better off getting a used Japanese bike that has a low cost to own.
So this is the key point, there’s not really how to know if it’s covering or not the depreciation, as the KBB’s or NADA guides for bikes are not as precise as the ones for cars.

What would you consider a “normal” 3 year depreciation on a bike like that? Around 50% like in a car? More? Less?
 

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That kind of financing is very common in Europe.
 

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So this is the key point, there’s not really how to know if it’s covering or not the depreciation, as the KBB’s or NADA guides for bikes are not as precise as the ones for cars.

What would you consider a “normal” 3 year depreciation on a bike like that? Around 50% like in a car? More? Less?
look up 3 year old bikes today and compare to their MSRP. That will give you a good idea.

The motorcycle market is soft right now so you are much better off buying used if you can find a bike that has what you want. Manufacturers are pushing more advanced bikes to entice folks to buy new. Kawasaki used to go up to 20 years without changing a model but now they have to change to entice folks to buy new. The Vulcan 1700 lineup was their attempt to get a little of the Big Cruiser market from Harley but without constant advancement they couldn't compete. They went from 5 models in 2011 to just 2 models today and the MSRP is lower than it was in 2010.



Harley has been running a promotion where they will give you what you pay for a bike today when you trade it in 12 months from now. Sounds like a good way to work your way up into a higher level bike. The problem is that none of the pricing is set in stone so the dealer can rip you on the price of the new one you are trading in for.

The dealer/manufacturer/finance company always win in these scenarios but that is what keeps them in business. They don't like people who pay cash, negotiate hard, and pay off credit cards each month.
 

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The only situation I'd choose to lease anything is if I was financially stable and could therefore afford payments forever and I wanted to get something new every few years. If I plan to keep a bike a long time then leasing doesn't make sense. If my financial situation was sketchy I'd rather pay it off and have something to ride that only costs me fuel and insurance. And, as others pointed out, if you're not financially stable then buy used until things turn around. Then you can get something nice without any risk.
 

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Basically it is a lease. Leases are yuuuge money makers for the finance company, which must mean they are money losers for the buyer.

I've done auto leases twice and been unsatisfied both times. I justified it at the time of purchase that my income was temporarily low, and would be going up in a couple of years and I could afford the buyout. However, in the end realize you are simply renting the machine for the duration of the lease. You have zero equity in the machine, and probably the buyout price will be higher than the machine is truly worth.

If you like living on payments and you like getting a different machine every 3 or 4 years, the lease is one way to do it. It is expensive because you take on the depreciation of new machines every few years.

You get cheaper payments today but you end up paying them forever. Would you rather pay $200/month for a couple of years or $150/month for the rest of your riding life?

A much cheaper option is to buy a low miles used bike. There are a lot of them out there. Most people don't ride a lot of miles and they do take care of their bikes. You can save thousands on what is essentially a new bike. The exceptions I would make are crotch rocket bikes which have probably been flogged even if new, or a seller who didn't seem like the kind to treat his stuff well. I'd pass on used bikes in those situations.

Leases are known as "fleeces" for good reason.
 

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...A much cheaper option is to buy a low miles used bike. There are a lot of them out there. Most people don't ride a lot of miles and they do take care of their bikes....
I bought a '01 Nissan Maxima new ($35K) and STILL have it in AZ, w/ about 108K miles on it; and an '03 Mazda Protege5 new ($25K) w/ about 84K miles on it here in BC. The Nissan has co$t me about $1.8K/ year, the Mazda about $1.5K/ year, and that is considering neither as having any value, which obviously they DO.

I don't believe I could have leased at anywhere those numbers.

:)

My '08 V650 co$t $7500, so only around $625/ year.
 

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I bought a '01 Nissan Maxima new ($35K) and STILL have it in AZ, w/ about 108K miles on it; and an '03 Mazda Protege5 new ($25K) w/ about 84K miles on it here in BC. The Nissan has co$t me about $1.8K/ year, the Mazda about $1.5K/ year, and that is considering neither as having any value, which obviously they DO.

I don't believe I could have leased at anywhere those numbers.

:)

My '08 V650 co$t $7500, so only around $625/ year.
One of my leases was an '01 Dodge Durango. It was the perfect vehicle for us at the time. When it came time to turn it in the buyout price was several thousand more than book value, so I just turned it in and bought something else. The dealer tried to get me to buy it at the lower book value but it was too late. A few months later the gas prices spiked to $5 per gallon and I was really happy not to have the Durango!

The other was a '99 Chevy Astro. Also a perfect vehicle for us at the time, and we did buy it after the lease. But my total payments on it were higher than if we'd just made loan payments from the beginning. I think I made payments for 7 or 8 years on that thing.

I don't want to be harsh, but if someone can't afford 3 or 4 years of loan payments on a vehicle then their finances can't afford it. They should be looking for something else or they need to re-arrange their finances. I've been young and poor with a house full of kids, so I am not unsympathetic. Just older and learnt from being burnt.
 

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Discussion Starter #13
Thanks for all the replies guys.

I’ve done a lot of research on this topic and found several questionable points:
- at the end of the term the dealer will appraise the bike and make you an offer. This offer could be higher or lower than your balloon payment due
- also, the dealer is NOT obliged to accept your bike as a trade-in or buy it from you
- you can pre-pay your loan BUT whatever extra payment will go towards your monthly payments and NOT to your balloon if you pay all your monthly pmts before the regular term, your balloon payment becomes immediately due

To me the worse is the first one above. Imagine you crash the bike and it’s not a total write off, that accident will be on the VIN report and for sure any evaluation of your bike will be low balled big time. That means it’s very likely when your ballon payment is due you will never be able to sell it (being it trade-in or private sale) for an amount equal or higher to your due. The only option are to pay the due and keep the bike or sell it and get some more money to finish paying your due....
 
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