Financing a Bike before the trip?
 

Hi All,

First post here. If you don't own the bike and are financing from a bank does that affect documentation or make it more difficult?

Just so you know I'm planning a trip that may involve more then 6 countries.

Thanks,

Scott

Hi Scott:

I think it depends only on what name appears on the ownership/registration document for the motorcycle.

If it is your name on the document, then whatever financing you may have makes no difference at all.

Michael

Going to Mexico, for instance, requires a notarized letter of permission from the lien holder. Good luck with that one.

Hi,
Financing a bike sounds as if you are short of money (not good for a trip) or the bike is very expensive (not good for a trip because high loss of value per kilometer). I would leave this expensive thing at home and get a cheap bike like a tenere or transalp for 1000 bugs. Then you can enjoy your trip and dont have to worry about the bike might get some scratches or even get stolen.
Travel save, Tobi

I still haven't decided what bike to buy yet! Money isn't quite the issue.

I was considering something newer. It just might make more business sense instead of purchasing outright. Just wanted to see what hurdles there are. As stated an older and/or cheaper bike might make more sense. Anymore advise with this would be appreciated

Whatever the bike, you need one with a clear title, no lien.

If the bike gets stolen - you have to be able to withstand the loss. Preferably without future consequences to your financial standing. Best if you own it outright and have funds that cover costs in getting you back home and some time at home to get a job.

Hi Scott:

I think Warin has offered excellent advice in his post directly above.

It is extremely difficult (and very, very expensive) to obtain insurance for theft or collision/comprehensive of the motorcycle if you are travelling outside of your 'primary backyard' - that means USA/Canada for the North Americans, and the EU 'Green Card' countries for the Europeans. Hence you need to be in a financial situation where you can withstand complete loss of the motorcycle should that happen due to theft (or, a bad accident).

That doesn't necessarily mean that you can't finance the motorcycle, but it does mean that you have to have sufficient assets readily available - such as reasonably liquid investments - to enable you to pay the note off immediately if the motorcycle is wrecked or stolen.

I suspect that most loan agreements require that you keep the asset insured for theft, collision, and comprehensive, and I also suspect that most loan agreements require that the note be paid off immediately if the asset itself is stolen or wrecked.

So - in short - if you can't afford to buy it outright (and take the risk of losing it entirely), it might be best to not consider travelling outside of the countries where you have full insurance coverage.

Michael

I'm not sure, but are there any restrictions in the countries where you plan to travel that might require you to have a clear title? I'm not a world traveler, but it seems to me that each country might have specific requirements. Maybe you would require full ownership to purchase insurance in those countries, get through customs or border crossings etc.

But one of the RTW travelers would know better than I.

The insurance required by the bank certainly changes things! As well as what type of insurance is required to travel, didnt think of that.

I have plenty of liquid assets to cover the cost of the bike if something goes wrong. I guess my question relates to paperwork for the countries I'm traveling too/through so I'll have to check specifically into that.

As i said it's more a personal business decision not to spend on the bike outright as they are newer and more expensive i.e. KTM 1190 adventure, BMW gs adventure. Considering other alternatives might prove to be more cost effective in the long run.

Thanks

Uk here and my friend just shipped bike to the US for a trip and had to pay off finance or they wouldn't put it on the boat!


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Scott:

What I can't figure out is how anyone concerned would know that the bike is financed (in other words, that there is a lien on it) unless that was explicitly stated on the vehicle registration papers.

I know that where I live (Ontario, Canada), if a vehicle is leased, the title is printed out in the name of the lessor, not the lessee. But if the vehicle is financed, the title is printed out in the name of the buyer (the person who financed it), and the only record showing that the vehicle has been financed is at the provincial lien registration office. That makes it pretty unlikely that any border guards, etc. would be aware of it.

There is a tremendous amount of vehicle traffic back and forth between Canada and the USA, and I'm sure that only a minority of the drivers have clear title to their vehicles. That doesn't seem to affect that cross-border traffic.

Michael

Texas titles have the lien recorded on them, not sure about other states.