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Discussion Starter #1
what is this im hearing about... buying a new motorcycle with cash for your first bike and go for liability insurance.
 

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Well you are a young person, and if you have no credit then good luck getting a loan.
Now the question about paying cash, then only getting liability. When I got my bike and went searching for a insurence company, every company told me that I needed coverage for the bike if I was financing. So yes, pay cash and you can get only liability, but make sure taht you wont really regret that decion, if something happens.
 

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In my opinion, cash is the way to go for every bike. For a very few people, a motorcycle can be your primary transportation, and if you have a job, but no money, and you need the bike to help you get more money (like being reliably at work on time), then I can understand financing a bike.

But for the other 99% of us, financing is a way for you to give lots of your money to people you don't love. Where does that money go?
1. Interest. 10% interest on a $6,000 loan is $600 per year -- yikes!
2. Capital cost, since an older bike is rarely financed. You could have bought great used $4,000 bike instead of that new $8,000 bike -- double yikes!
3. Insurance. Especially if you're young and riding a big bike you could be paying hundreds or even thousands per year for insurance. Get the defibrillator! If you had liability only, you could save most of that money. Liability insurance for a motorcycle is usually cheap. Full coverage can be very expensive.

Another reason to pay cash, especially for your first bike, is that you have a good chance of doing some damage to it. So a lot of people get a cheap bike first, and learn to ride it well, and scratch it up a couple of times, then get a nice bike later. I think that's a smart way to go. I paid cash for mine.
Curt
 

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yoassizmine said:
what is this im hearing about... buying a new motorcycle with cash for your first bike and go for liability insurance.
Buy your first bike used and if you are not familiar with technical stuff take it to a reputable shop to have it cleared before buying. In the long run it will save you lots of money.
 

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Discussion Starter #6
don't people buy their first bikes that aren't used?..it seems that everyone is buying a used bike for their first bike
 

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Sure you can. Be prepared to pay your full comprehensive insurance and also your lousy interest rate. The reason both are so high is because they expect you to crash and want to get their money too!.

Advantages of a new bike would be that you are the only owner and therefore have the entire history. No scratches, no dents - pristine.

Downside:
You also have to pay for your initial service - couple hundred bucks and wait until your break in period is over to wind it up.
 

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Yep, buying new with cash was the way I went. I had the money at the time and a loan wasn't an option. Liability insurance is very cheap, and works fine for me.
 

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It sounds like you got two good deals, bdropped: interest rate and insurance. I'd like to use you as an example for yoassizmine.

For the example, let's say that you paid $3,500 out the door for your Ninja 250. And let's say that you put 20% down, and financed the rest for 2 years at 4.9%. Let's also say that half of your insurance cost is collision and comprehensive. Now let's compare all of that to buying a $2,000 used Ninja 250. For this comparison, suppose that you also spend $500 on gear.

Total cost over 2 years:
. . . . . . . . . . . . . new . . . . . used
purchase price . . .$3,500.00 . $2,000.00
down % . . . . . . . .20% . . . . .100%
down $ . . . . . . . . $700.00 . . $2,000.00
finance . . . . . . . . $2,800.00
rate . . . . . . . . . . .4.90%
term, years . . . . . 2
pmt . . . . . . . . . . .$122.71
total . . . . . . . . . . .$3,645.15 .$2,000.00
insurance per year $500.00 . . $250.00
insurance total . . . $1,000.00 . $500.00
gear . . . . . . . . . . .$500.00 . . $500.00
total cost . . . . . . . $5,145.15 . $3,000.00

That's a pretty big difference, but you do get something for buying new. You get a bike that no one has abused. You get a bike in showroom condition. You get a warranty, and probably no unexpected repairs. And you get collision and comprehensive insurance. So I'm not trying to say that it's always bad to buy new. I'm just saying that it's going to cost you. You might look at the numbers and say, "Heck, it's only five grand for a brand spanking new ride, and I don't have to worry about anything? Where do I sign?" If you have a good job or lots of savings, then that's fine for you. But if you're just starting out, and you're poor, and you need basic transportation, then you don't need to be spending the extra money to buy new.

Now suppose that at the end of the two years you want to figure out how much the ride has cost you. Maybe you don't like motorcycling after all. Or maybe you want to upgrade to a ZX-6R. Your used Ninja 250 will hold it's value pretty well. Let's suppose that it's now worth $1,500. But that new one dropped in value a bit, down to $2,000 (it's a used bike now).

total cost . . . . . . . . $5,145.15 . $3,000.00
value of bike at end $2,000.00 . $1,500.00
net expenses . . . . . $3,145.15 . $1,500.00
monthly cost . . . . . .$131.05 . . .$62.50

So you can see that the average monthly cost of a new Ninja 250 is more than twice the average monthly cost of a used one. That's why I think that for most people it's smarter to buy used.

That doesn't mean that bdropped made a bad choice. He got a newer bike, after all. It just means that he spent more than if he had bought a used bike. If he has the money to spend, then good for him. Have fun with it.
Curt
 

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Curt that was very good comperison you did. Never really did notice how much of a difference we were talkin.
 

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Discussion Starter #12
thanks for the great comparison curt now im considering to buy a used bike for now...but would the cost be the same if i wanted to trade in for a new zx-6r?
 

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You'll have to run your own numbers to know for your situation. Mine are just a typical example. But I would think that if you're planning to get a ZX-6R later, that is even more reason to get a used 250 now instead of a new 250. You need to save up in order to get that ZX-6R. And during that time, you can be building skills on a 250. It's good to plan for the future.
Curt
 

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I concur!

Knowing that you will upgrade, buy the Ninja 250 used. Plenty out there for good prices.
 
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