Snowmobile Financing

While some may prefer the comforts of a fireplace and a good book on a cold winter’s day, snowmobile fanatics would beg to differ. With more than 1.2 million registered in the United States and 600,000 in Canada, snowmobiles have become a hit for outdoor enthusiasts who enjoy the cold.

Snowmobiles aren’t just for hobbyists, though. They are a critical means of transportation for the military, government services, farmers and ranchers, postal delivery workers, and ski patrols all across the North.

If you’re reading this, you’re probably looking for a snowmobile loan to finance the purchase of a new vehicle. We’ll explain how these loans work and cover a few of your options, below.

In this review:

• Where to find snowmobile financing
• What are the costs of snowmobiling?

Where to find snowmobile financing

Since the cost of a new snowmobile can be high, snowmobile loans are common. Generally, the most common sources of funding are personal loans or dealership financing. We’ll break down some of your options below.

• Snowmobile loans—easy applications and online financing
• Dealership financing—get your snowmobile and loan from one source
• Credit cards—probably not a good idea

Using a snowmobile loan

Personal loans are one of the most common financing tools because they are unsecured, you can get funding quickly, and you can use them for just about anything, including financing a snowmobile.

One thing to understand about personal loans is that, as with most forms of financing, snowmobile loan rates will depend largely on your credit. If you have a good credit score, you could probably get a snowmobile loan at a great interest rate. But if your credit is poor, you’ll face higher rates.

Here are a few of your options:

LightStream

Offering loans for almost anything, LightStream ranks as the best personal loan for excellent credit with low rates and no fees. If you have good credit, LightStream’s powersport vehicle loan is an excellent choice to fund your snowmobile purchase.

• Credit score category: Excellent, good
• Soft credit pull to check rates: Not available
• Deposit time: As soon as the same day
• Origination fee: 0%
• Late fee: None
• Discounts: 0.50% interest rate reduction for enrolling in autopay
• Repayment terms: 24 – 144 months^**

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Upgrade

If you’re looking for an online snowmobile loan and you have bad or fair credit, Upgrade is a good option. They provide flexible repayment terms and even allow customers to change their payment dates to accommodate their monthly budgets.

• Credit score category: Fair, bad
• Soft credit pull to check rates: Yes
• Deposit time: As soon as the next day
• Origination fee: 2.9% – 8%
• Late fee: $10
• Repayment terms: 36 or 60 months

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Upstart

Upstart is an online lending platform that partners with banks to provide personal loans that can be used for almost anything. Upstart’s lending model considers education, employment, and many other variables when determining eligibility.³ This model leads to 27% more approvals and 16% lower rates than traditional models.⁴

• Credit score category: Fair, bad
• Soft credit pull to check rates: Yes
• Deposit time: As fast as one business day
• Origination fee: 0% – 8%
• Late fee: $15 or 5% of payment
• Repayment terms: 36 or 60 months

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If you want to compare more options, you can check out our guide to the best personal loans.

Dealer financing and specialized lenders

Another common form of snowmobile financing is an 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 lenders, but consumers can also obtain these loans directly from the lender. Every now and then, manufacturers offer special factory financing as well.

If you’re buying your snowmobile from a dealership, ask if they offer any financing options. They may finance your purchase directly or refer you to a partner lender.

However, if you’re interested in using dealership financing, make sure you compare their rates with another option, such as one of the personal loan lenders above, to make sure you’re getting a good deal. Some dealers may pressure you into taking a bad offer by getting you to sign on the spot.

A credit card is probably not a good option

Many snowmobile purchases are made with credit cards, which could be the most expensive form of financing available since the average credit card interest rate is around 17%.

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 balance transfer credit card with a 0% APR introductory period. 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.

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.

Here are a few factors that will affect the cost of your snowmobile.

The type of vehicle you want

According to Snowmobile.org, 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.

Thrill-seekers who want to test their own limits can buy a snowmobile with many of the elements of a lightweight racing motorcycle for around $15,000.

Other gear & equipment

The costs don’t stop at your vehicle, however. Active snowmobilers average more than 1,200 miles per year on and off the trails, spending as much as $4,000 a year for trail fees, transportation costs, insurance, maintenance, and equipment.

For example, if you do extreme snowmobiling and you need high-quality protective clothing, an outfit could cost as much as $800. Of course, these costs will vary a lot based on your needs and preferences.

Regardless, snowmobiling is definitely not a poor man’s recreation. 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 costs can climb to more than $20,000.

That’s why many people turn to snowmobile financing.

Bottom line: Compare snowmobile financing to find the best rates

The preferred financing option may be factory financing that includes a rebate and a low rate. The next best option would be to obtain your financing through a personal loan lender, then negotiating your best cash offer with a dealer.

If you are unable to qualify for good snowmobile loan rates with either form of financing and are looking at a high-interest credit card as your financing source, your best bet would be to wait until you can save more money towards your purchase, or to take steps to improve your credit score before reapplying.

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^*Your loan terms, including APR, may differ based on loan purpose, amount, term length, and your credit profile. Excellent credit is required to qualify for lowest rates. Rate is quoted with AutoPay discount. AutoPay discount is only available prior to loan funding. Rates without AutoPay are 0.50% points higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice.

^**Payment example: Monthly payments for a $10,000 loan at 5.95% APR with a term of three years would result in 36 monthly payments of $303.99.

¹The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 21.97% and 36 monthly payments of $35 per $1,000 borrowed. For example, the total cost of a $10,000 loan would be $12,646 including a $626 origination fee. APR is calculated based on 3-year rates offered in the last 1 month. There is no down payment and no prepayment penalty. Your APR will be determined based on your credit, income, and certain other information provided in your loan application.

²Your loan amount will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will qualify for the full amount. Loans are not available in West Virginia or Iowa. The minimum loan amount in MA is $7,000. The minimum loan amount in Ohio is $6,000. The minimum loan amount in NM is $5100. The minimum loan amount in GA is $3,100.

³Although educational information is collected as part of Upstart’s rate check process, neither Upstart nor its bank partners have a minimum educational attainment requirement in order to be eligible for a loan.

⁴Approval numbers compare the 2020 loan approval rate by the Upstart model and a hypothetical traditional credit decision model. The APR calculation compares the two models based on the average APR offered to borrowers up to the same approval rate. The hypothetical traditional model used in Upstart’s analyses was developed in connection with the CFPB No Action Letter access-to-credit testing program, is trained on Upstart platform data, uses logistic regression and considers traditional application and credit file variables.