Minimum Credit Score For ATV Loan

Whoever told you that off-roading is not fun is either lying or hasn’t done it at all. Of course, to each is his own, but generally, to get out there in nature with machines that could spike up your adrenaline levels in a split second is very addicting. It’s a relief from the hustles and bustles of our everyday life, and once experienced, you could never go back to a life without it anymore. Having said that, have you ever wondered why you see countless of Americans with their All Terrain Vehicles on their trailers hitched to their vehicles every weekend on the road? Well, because it’s fun, and the entire family could take part in it, be it in the sand dunes, beach, or in the woods. You could have an adventure with it from almost anywhere, well except on and in the water of course, but other than the water, it’s good to go. It’s a way to unwind and at the same time spend quality time with the people that you care about while out in nature. Talk about hitting multiple birds with one stone. Well, this hobby epitomizes it, in a way.

What’s the minimum Credit Score for ATV loans?

There’s a consumer consensus that a 600 FICO credit score could get you financed with most dealerships, but the rates are not going to be favorable. In this kind of scenario, you’ll have a limited array of ATV models to choose from, you’ll be asked for a higher down payment, and the finance companies will use the ATV as collateral for the loan. The best-case scenario for this is to have a 640 and up FICO credit score, in that way, you’ll have multiple financing options. With a higher credit score, they’ll not require you to use your ATV as collateral for the loan. You’ll also have a lower interest rate and an unlimited choice of ATVs to choose from.

 Another instant solution for this, if you are credit score challenged, is to get a co-signer for the loan, this would save you a lot of time. A higher credit score cosigner could get you playing with your brand new ATV in no time. 

Will the inquiries affect my chances of getting approved?

Yes! Once you get too many inquiries within a short amount of time, some lenders will automatically deny your credit application right away regardless of your credit score. Don’t let your inquiries go beyond 6 hard pulls while you’re shopping for the right financing for your ATV. Loan officers from the dealerships usually go crazy on the credit pulls because they’re incentivized to get you financed in order to get the sale, that’s their hustle, yours is to make sure you get the best financing deal possible for yourself and having multiple inquiries on your report wouldn’t help you a bit with that goal. You need to be aware of that standard operating procedure in an ATV dealership to protect yourself from excessive credit hard pulls, which is very damaging to your credit report. 

What are my financing choices?

Retailer Financing through the dealership

This would be the most common financing option for consumers with lower credit scores. Usually, manufacturers would have in house financing programs to help dealerships move inventory to support the manufacturer’s corporate strategy. Deals usually happen with brands that have low demand, but sometimes popular brands would have it too. Just be aware of the teaser rates that they use to draw you in, learn how it works, and use it to your advantage. Most of the time, they have a financing plan with low-interest within six months, then after that, the interest shoots up in points that is quiet on the high side, so it’s better to read the fine print first before you make your informed decision. The downside for this in terms of unit choice is that you’re constrained with just a number of manufacturers, you may need a sizeable down payment for financing, and then they’ll use the ATV as collateral for the loan. It’s important that you clarify all of it with the dealership’s financing agent so that you’ll not get blindsided by the different fees that are usually hidden in the fine print. Always remember, in finance the devil is in the details.

Personal Loans

For me, a personal loan is the best value financing option for a big-ticket ATV purchase for consumers with higher credit scores. There are tons of low-interest loans out there that are available to people with FICO scores of  680 and up.  I see a lot of  $35,000 with twelve to sixty- month low-interest-rate unsecured loans offered everywhere online, from private financing companies, banks, peer to peer lending sites all the way to credit unions. With this kind of loan you have an unlimited option on the kind of All-terrain vehicle, you’ll be purchasing as long as your loan amount covers the price. Another great thing about this is, you can shop for a loan even before you set foot in the dealership. Compare and compute rates and amortization schedules to fit your budget in the comfort of your own home or from anywhere without the pressure tactics of different salesmen influencing your decision-making process. For me, I find it easier to go shop for things when I already know the budget beforehand so that I’m able to do an in-depth research of the item before actually seeing it.

Credit Cards

This option could be used in the short term, I highly don’t recommend this for long term financing. Although this is quite expensive compared to the other financing options, some actually do go for it when it’s the only thing that they’ve got. Nevertheless, there are credit card offers out there that have 0% APR introductory rates for 12 to 15 months that you could take advantage of. If structured well, this kind of financing can be harnessed to build your personal credit. I strongly advise using credit cards when there are no introductory rate promotions because it’s just irrational. It’s very financially irresponsible to do that, especially if you’re thinking of holding the debt for more than one month.

Most of the time with Personal loans and Credit card financing you’ll be able to bring down the unit price of the ATV by 5% to 20%. because you’ll be negotiating with them by cash basis drawn from your credit cards and loans. Watch out for different fees on the closing cost because that’s where they usually get you when they get desperate. There shouldn’t be a lot of fees anymore when you pay them cash

Based on my experience they usually get you with tons of fees when you do dealer financing. They will mark up the unit price quite high then add an endless amount of fees that snowballs into a number that usually adds up 10% to 30% more than the original unit price. There’s a tested and proven business model process that all these dealerships implement that it’s quite hard to find a workaround with in order to get a real bargain. They give you a deal on one aspect, yet they’ll get you on the other end. For me, the best way to do it is just to negotiate a cash per-unit price(haggle as much as you can, get multiple quotes from different dealers and make them compete for your business) and then cut them a check that you’ve drawn from your loans and personal lines of credit to make everything simple. 

Bad Credit ATV financing options

If you have bad credit, there are still financing options out there for you, but the terms wouldn’t just be as favorable as the terms for someone with good to great credit. Bad credit lenders will mostly focus on your down payment and debt to income ratio. It is not uncommon for lenders to require you to put down a sizeable down payment for the loan. 

Another option would be to bring a cosigner, but just know that they would usually place the co-signer as the primary borrower of the loan so that you’ll be able to get the best rate for your purchase.

How many years can you finance an ATV

Well, when it comes to the financing length the answer is, it really depends. Mainly, it boils down to preference and how much you could afford every month. Most finance companies out there offer 36 to 60-month terms but nowadays I’ve seen it stretched all the way up to 72 months. Of course the longer the loan the higher is your total loan amount at the end after you add all the interest fees and I highly suggest if you got the means to always go for the shorter term. I know most usually go for the longer term with lower monthly amortization because the shorter term has a bigger monthly amortization and I get it. Sometimes you’ve got to balance work and play too, but just know that the benefits of going the shorter term route are quite sizable in terms of savings. As long as you’re informed, I’m good with that. 

Here’s an ATV  loan calculator to help you with your budgeting before you pull the trigger on that Brand New ATV.