How to get a loan for an ATV or snowmobile

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Ask a Lender
September 8, 2017


Key Points

Getting ATV or snowmobile financing

  • A loan for an ATV or snowmobile is secured, meaning it’s backed by the value of your purchase.
  • A secured loan may secure you a lower interest rate, but if you default on the loan, the lender can repossess your vehicle.
  • Your credit score may impact your eligibility and your interest rate.
  • Making a down payment can reduce the risk of your loan going upside-down.
  • Many loans for ATVs and snowmobiles may be classified as RV loans.

If you like extreme hobbies like off-roading or snowmobiling, you must have the proper vehicle for your sport. That’s where an ATV or snowmobile — or snowmachine, as it is called in Alaska — comes into play.

ATVs and snowmobiles can cost several thousands of dollars, and there’s a good chance you’ll need a loan to purchase one. But what should you expect when applying for a loan? Here are some things to think about as you navigate the process of financing your sports vehicle.

Secured loans

In the simplest terms, a loan to purchase an ATV or snowmobile is similar to a car loan. Both are secured loans backed by the value of the vehicle being purchased. This means that if you are ever unable to make payments on the loan, and it goes into default, the lender could repossess your ATV or snowmobile.

So, what’s the benefit of a secured loan? Having collateral backing the loan helps you secure a lower interest rate than if you were taking out an unsecured loan — one not backed by collateral. Other factors, such as your credit score, also can affect what rates lenders will offer you, however.

Credit score

A number of different factors affect what rates lenders will offer you on an ATV or snowmobile loan, but one of the most important is your credit history.

Before you find a vehicle to purchase, look up your credit report. You are entitled to one free copy of your credit report each year from each of the three major credit reporting bureaus. To request copies of your credit reports, go to

Look over your report and look for any inaccuracies. If you see anything that looks wrong, you can report it to the bureaus. Correcting errors can help improve your score. Also look for any negative aspects of the report you may be able to improve. For example, if you have any outstanding debt, pay it off. Doing so should give your score a boost.

Down payment

A down payment may or may not be required to finance the purchase of an ATV or snowmobile, but it’s often a good idea to put some money down, as it can prevent your loan from going “upside-down.” An upside-down, or underwater, loan is one where your collateral — in this case, the ATV or snowmobile — is worth less than what you owe.

For example, if you still owe $8,000 on your ATV, but its depreciated value has dropped to $7,000, the loan is underwater by $1,000. A down payment reduces the risk of a loan going upside-down because you’re building equity in your purchase right off the bat.

Look for RV loans

Many lenders classify loans for ATVs and snowmobiles as loans for powersports vehicles. But you should be aware that some lenders’ loans for recreational vehicles, or RVs, encompass ATVs and snowmobiles. Although you may think of trailers or motorhomes when you think of RVs, many lenders consider any motorized vehicle used for recreation an RV. These loans may or may not have better interest rates or terms than other loans you could use to purchase an ATV or snowmobile. Shop around and compare the rates of different lenders before you make your purchase.

Financing the purchase of an ATV or snowmobile doesn’t have to be a total pain. Do your research and go into the process prepared. You’ll be cruising through the trails or snowdrifts in no time.

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