Motorcycle Forum banner
1 - 20 of 28 Posts

·
Registered
Joined
·
18 Posts
Discussion Starter · #1 ·
I know im going to open a huge can of worms here - but hear me out!

If you didn't catch me on the intros - I'm Mike, 35, living out in Seattle. Started riding at 14 or so on a 80cc dirt bike. Over the years I had a ninja 500, hawk gt, cbr 600, and VFR800. Haven't had a bike in a few years - but a recent trip to Thailand gave me the itch again! (cause there's tons of scooters and bikers zooming around everywhere).

Back to the point. I have more than enough money to go buy a bike, gear, insurance, etc. But im always looking for opportunities to kill multiple birds. I looked into some loan options to further improve my credit, and came across an idea to put it on a credit card with a nice long 0% intro term and maybe one of those instant $150 credits when you spent 3k in the first 90 days or something (that's a shiny new helmet, courtesy of the credit card company!! Lol). That way I could continue to improve my already great credit, I would hold the title, and I could pay it off with no interest. I would 100% be creating my own payment plan to get the balance paid before the 0% intro is over.

Coincidentally - my wife and I have been talking about adding a third card to our wallets. We currently use a 2 card combo that combines travel credit - which we've had for a handful of years. We have no other debt and have never paid 1 penny in interest on these cards. We actually make money off these cards with the traveling we do. We've just been wanting to add another card that has some different kinds of rewards - like a decent cash back rate.

So the question is - has anyone done this for a bike before? If so - any specific things to look out for that I may have overlooked? Any card recommendations?

I know how these credit card convos go - so go easy! Lol. Im not trying to find a way to buy something out of my means - so that's not an issue here.

For a little more context - I will probably not buy new. I'm into DIY (although I'm not a pro mechanic) so I like to have something to tinker with. Probably going to go for a smaller street bike, like 250-400. I used to want the power back when I flew copters (can't be a pilot and cruise a little bike haha) - but now I'm just about the cruise. So I won't be spending 5 figures or anything. More like a few grand.

Thanks for reading/helping!!!
 

·
American Legion Rider
Joined
·
25,876 Posts
I've not done it on new purchases and not sure they even allow it. But I have done it on used purchases several times. And here's a key to improving that credit score, pay it off as soon as possible. But also watch the fine print on that card application. They put all kinds of "gottcha's" in them. So read closely.
 

·
Registered
Joined
·
607 Posts
If you've already got perfect credit, how are you going to improve it by adding debt, even temporarily? I have a friend who used exactly the same logic when buying a new car -- get the 0% loan, bank the cash to earn a little bit of interest, pay the loan off ahead of time. Great idea, right? Except -- he suffered an unexpected catastrophic illness right after he got the car, his wife left him shortly thereafter, and he got fired from his job. Care to guess how his credit rating looked a year later?:crying:
 

·
Registered
Joined
·
18 Posts
Discussion Starter · #4 ·
If you've already got perfect credit, how are you going to improve it by adding debt, even temporarily? I have a friend who used exactly the same logic when buying a new car -- get the 0% loan, bank the cash to earn a little bit of interest, pay the loan off ahead of time. Great idea, right? Except -- he suffered an unexpected catastrophic illness right after he got the car, his wife left him shortly thereafter, and he got fired from his job. Care to guess how his credit rating looked a year later?
Absolutely right man! Things happen and that is definitely a fair concern.

Although, I do have the money. And my wife and I want a third card regardless. I just figured I might as well utilize a 0% introductory term. Also - it's not as if we're talking big money for a car. More like a few grand for a small bike and related initial expenses. Sure - there's always the option of just paying cash....and im not totally opposed to it. Just exploring options.

About my credit....definitely not perfect. 720 or so last time I was informed when doing my taxes earlier this year. I guess I should just call it irrelevant in this plan at this point.

Thanks for the words!
 

·
Moderator - Loves All Motorcycles
Joined
·
1,251 Posts
If you have the means to pay off whatever the balance on the card would be (that's an issue many don't consider before signing up for cards), I don't see why not. It seems like a win-win for me!

One thing I'd look into is making sure the card offers some kind of insurance in case you lose your ability to pay. The card issuer for a credit card I had a few years ago had such a thing. It was basically if I lost my job and couldn't get another within 30 days, they would either indefinitely postpone payments or close the account and call the debt paid. And when that exact thing happened to me, it was a lifesaver. IIRC, that insurance only added $7/mo to payments.
 

·
Retired twice: Navy and as a govt contractor
Joined
·
15,487 Posts
720 credit score isn't bad, just depends who is reading it. I bought my last truck out of my money market account (cash to the dealer) and then set up payment from my military retirement back into my money market account. Plan on doing the same when we get my wife's car.
 

·
Registered
Joined
·
18 Posts
Discussion Starter · #7 ·
One thing I'd look into is making sure the card offers some kind of insurance in case you lose your ability to pay. The card issuer for a credit card I had a few years ago had such a thing. It was basically if I lost my job and couldn't get another within 30 days, they would either indefinitely postpone payments or close the account and call the debt paid. And when that exact thing happened to me, it was a lifesaver. IIRC, that insurance only added $7/mo to payments.
Thanks! That's a valuable tip!
 

·
American Legion Rider
Joined
·
25,876 Posts
If you've already got perfect credit, how are you going to improve it by adding debt, even temporarily? I have a friend who used exactly the same logic when buying a new car -- get the 0% loan, bank the cash to earn a little bit of interest, pay the loan off ahead of time. Great idea, right? Except -- he suffered an unexpected catastrophic illness right after he got the car, his wife left him shortly thereafter, and he got fired from his job. Care to guess how his credit rating looked a year later?:crying:
Even with a good credit score and money in the bank, you need to have credit activity to keep that good score. Best way is to use someone else money. They are happy hoping you get in trouble and if you don't, you are happy maintaining a good credit rating.

We can now pay cash for most things. But we use this trick to keep our credit rating good and active. It pays off big time for those things we want that we would rather not pay cash for. Like my Indian. That was just too big a chunk. But we got the best possible loan because our credit rating is up there where you almost have to be able to walk on water to get. We can't but using that trick keeps us up there anyway. Of course the rules may change at any time too. They like doing that too.
 

·
Registered
Joined
·
18 Posts
Discussion Starter · #9 ·
Even with a good credit score and money in the bank, you need to have credit activity to keep that good score. Best way is to use someone else money. They are happy hoping you get in trouble and if you don't, you are happy maintaining a good credit rating.
Its a common tale right? How many people have you come across over the years who say "I have no debt, no credit cards, no loans, car paid in cash - im not a sucker!!" ? Eventually something comes up and someone tells them sorry buddy, you have literally no financial history.
 

·
Registered
Joined
·
781 Posts
And that's the key, my friend. No financial history, no credit. It's a vicious circle. I'm lucky and also cursed with having no debt. Car, home, truck, everything is free and clear. However, I do buy a couple of things a year using a credit card.

When you do this, make sure you have the cash to pay off the loan (and that's what it is) immediately in case something happens.

You did not mention if you are a home owner. If you are a home owner, have a mortgage, and make your pmts on time, you're golden. If not, maybe that might be a better investment?
 

·
Registered
Joined
·
18 Posts
Discussion Starter · #11 ·
When you do this, make sure you have the cash to pay off the loan (and that's what it is) immediately in case something happens.

You did not mention if you are a home owner. If you are a home owner, have a mortgage, and make your pmts on time, you're golden. If not, maybe that might be a better investment?
Thanks for the reply!!

I have the cash for sure. As Macho Man would say - "it's no factor!!!" Lol.

In regards to owning a home - I do not. But we do plan on buying soon after the high season. I don't fully understand what you meant though - are you saying that if i have a mortgage that I don't pay on time, i should worry about that first? Or are you saying that if i don't own a home, I should invest in one rather than a motorcycle?
 

·
Registered
Joined
·
781 Posts
No. Having a mortgage is basically a line a credit. Just having a mortgage will boost your credit. Banks and finance companies want to see some debt in your credit history and how well you handle it. You sound like a responsible young man that is trying to make other peoples money work for YOU. So, that being said, you have to live somewhere, right? Current mortgage rates are around 4%. Housing appreciates at roughly 10% per year. Or at least it used to. You end up borrowing money at 4% and make 6% off that borrowed money per year. Somebody on this forum can explain it better than me, but that's the basics.

There is nothing wrong with Credit Cards, and you seem to have that handled really well. However, those cards can become a trap. IE: I want that now, and all I have to do is pay 50 bucks a month for 12 months. And then the next week you or your wife will find another 'I want it now'. And another 12 month payment plan. And another, and another, until your paycheck is used to mostly pay you credit card bills. Credit cards will lull you into a false sense of financial security.

As you stated, you have the money to buy the bike for cash. And by using the card, you will pay it off when the first statement comes in, so you can build up your credit score. It's a good idea and will work. However, buying a house is an investment where you can make some income off your debt. Boosting your credit score, making some money, and having a place to live is just a suggestion.

You're still young enough to have a lot of 'wants'. I want that bike. I want that car. I want that ...... And that's fine. Get what you want now, while you can. But then, sit down and discuss 'Wants and Needs', with your wife. You really WANT that 45,000 dollar 1 ton diesel turbo powered Pickup. But do you NEED it. There is a difference.

Whew. Kind of long winded there, Amigo. Hope it helped.
 

·
Registered
Joined
·
18 Posts
Discussion Starter · #13 ·
I think a lot of the thread went over your head here lol. What you described is not at all how I live my life (personal and financial).

This thread is really just about a credit card. We're buying a house by the end of the year - but it has nothing to do with me buying a motorcycle. They have no relation. The comparison being made is a few thousand on a bike vs. Investing in real estate? That's pretty extreme! Lol.

Thanks for the words. I mean no offense and appreciate the talk.
 

·
Registered
Joined
·
781 Posts
NP, my friend. I sometimes get off on a tangent. One thing leads to another, and I roll with it. Your idea with the use of a credit card and paying it off all at once will work. And like you said, with the extra 'bonus' of 150 bucks, it will pay for a good helmet. If it will raise your credit rating, go for it. I did the same thing when I started out.
 

·
Very Famous Person
Joined
·
10,002 Posts
--

M-214,

Not sure what you are looking for here. I suspect you just want some congrats on how to make the system work so you can get a bonus on opening a credit card account. So you post here to ask us experts on credit cards?

As to the purchase of a "couple thousand" dollar 250-400cc bike, that's not really an investment for someone in the position you seem to be. You sure won't get many thrills, but it will be fine for around town fun solo.

--
 

·
Registered
Joined
·
18 Posts
Discussion Starter · #17 ·
--

M-214,

Not sure what you are looking for here. I suspect you just want some congrats on how to make the system work so you can get a bonus on opening a credit card account. So you post here to ask us experts on credit cards?

As to the purchase of a "couple thousand" dollar 250-400cc bike, that's not really an investment for someone in the position you seem to be. You sure won't get many thrills, but it will be fine for around town fun solo.

--
Lol ok I feel like people are really overlooking the conversation. The main point was to ask if anyone had done it before, if anyone had any good experiences with specific cards, any other tips, etc.

If i elaborated on my thoughts - there was no intention of seeking any "congrats". Im just thorough - especially with a conversation about credit/finance because people almost always assume you're some broke kid trying to work over the system to pay as little as possible up front - then get into trouble later.

But yea - it's definitely not any investment on my part. I will probably spend 3k-3.5k max for the exact reason you said - just some around town fun. Not looking for any big thrills

Thanks for the words!
 

·
Very Famous Person
Joined
·
10,002 Posts
--

Few folks are expert on credit cards and, in fact, the promotions and rates with different cards change all the time. You'd need to research on a 'best credit cards now' type site to know. I personally have had cards since they first came out--many years. Currently I use some that have no annual charge, are widely accepted, and have a high rebate. Since I have never not paid my amount due every month from the beginning, and since I have several times gotten the card that also gave me a bonus for signing up, I use what is offered for my needs.

Having a FICO credit rating score well into the 800's helps get many offers at low rates--as did the high end bike I purchased last year. In that case, it was better to finance the bike at 1.99% since the saved money growth is much higher. One needs to consider the whole picture. :wink2:

--
 

·
Very Famous Person
Joined
·
10,002 Posts
--

I've been a "deadbeat" forever. They hate me. They have pinups in their offices with my photo where they throw darts. :smile_big:

On my side, I always say: "2% return on almost everything I buy is better than 0%."

--
 
1 - 20 of 28 Posts
Top