There’s something about the combination of speed and snow that is appealing enough for thrill seekers to want to shell out up to $15,000 for a motor on skis. With more than 1.2 million registered in the United States, snowmobiles have become a hot pastime for outdoor enthusiasts who enjoy the cold.
Reaching speeds of more than 90 MPH (200 MPH for drag skiers), they are more than just a fun toy. They are a critical means of transportation for the military, government services, farmers and ranchers, postal delivery, and ski patrols. But for hundreds of thousands of recreational enthusiasts, they are simply a whole lot of fun.
With thousands of accessible trails on public and private lands, snowmobilers have plenty of room to roam. That’s where snowmobilers can enjoy hours of on-trail riding and, where available, off-trail cross-country riding in powder and gentle open areas. The more adventurous thrill-seekers manage to find more challenging areas to test their mettle, including charging up and down steep mountains.
What Are the Costs of Snowmobiling?
Generally, the amount of money you pay for a snowmobile depends primarily on the type of riding you do. Snowmobilers who stick with trails and gentle open areas don’t need as much power or sturdiness as those who enjoy more extreme riding.
A novice snowmobiler could pay as little as $3,000 for a new, 120cc, four-stroke snowmobile. More experienced snowmobilers who can handle speeds up to 60 MPH, might pay an average of $9,000 for a more powerful two-seater vehicle with more stability. For thrill-seekers who want to test their own limits, they can buy a snowmobile with many of the elements of a lightweight racing motorcycle for around $15,000.
But, the costs don’t stop there. Active snowmobilers average more than 1,200 miles per year on and off the trails, spending as much as $4,000 a year for user fees, transporting their snowmobiles, insurance, maintenance, and equipment. A typical outfit consisting of shoes, protective gear, and clothing can cost as much as $800.
Snowmobiling is definitely not a poor man’s recreation. The average household income for snowmobilers is around $70,000 which means it could consume a big portion of the average snowmobiling family’s discretionary income. At an average cost of about $12,000 (including tow trailer), it is no small investment; and because many families own at least two snowmobiles, the average costs can climb to more than $20,000. That’s why many snowmobile purchases are financed in more ways than out-of-pocket cash. In fact, there is an entire segment of the lending industry devoted to snowmobile financing.
Dealer and Consumer Direct Snowmobile Financing Options
The most common form of financing used for snowmobile purchases is an unsecured installment loan through a power equipment loan specialist. These lenders specialize in financing power equipment such as motorcycles, snowmobiles, watercraft, all-terrain vehicles, and the tow trailers needed to transport them.
Financing is often obtained through power equipment dealers who partner with specialized lenders; but consumers can also obtain these loans directly from the lender. Every now and then, manufacturers offer special factory financing as well.
Because snowmobile loans are unsecured, dealer and consumer direct financing can be fairly expensive with the best rates for the most creditworthy borrowers currently ranging from 4.00 percent to 10.99 percent. Loans are available for up to $50,000 with loan terms between 12 and 60 months.
What About a Personal Loan?
Financing a snowmobile with a personal loan is certainly an option, but if you are unable to qualify for the lowest rates from a snowmobile loan specialist, you are not likely to qualify for a decent rate on a personal loan either. However, if you have excellent credit, you might be able to qualify for a loan rate that is lower than a snowmobile loan. If you decide that you would be able to handle the monthly payments on a personal loan at a given interest rate, then going with a personal loan lender may be a good option. Keep in mind that you need to put down on the application that these funds would be for a snowmobile.
A Credit Card is Probably Not Your Best Option
Many snowmobile purchases are made with credit cards which could be the most expensive form of financing. Some of the best credit card rates available are around 7 to 8 percent; but if your rate is anywhere near the national average, your APR could be around 16 percent. If you’re hoping to offset the higher rate using a rewards credit card, it will be a temporary offset at best. The ongoing interest charges will negate the benefits unless the balance is paid off quickly. The best option for credit card users is to use a zero interest balance transfer credit card. However, unless you are able to pay the full balance before the expiration of the promotional period, you will begin to incur the accrued interest charges on the purchase.
The preferred financing option may be a factory financing offer that includes a rebate and a low rate. The next best option would be to obtain your financing through a loan specialist and then negotiate your best cash deal with a dealer. If you are unable to qualify for either form of financing and are looking at a high interest personal loan or credit card as your financing source, your best bet would be to wait until you can save more money towards your purchase.
Author: Jeff Gitlen
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