APR Explained

Learn more about APR

As part of any application for Motorbike Finance, a term that will come up each and every time is APR. The team at MotoFinance have put together the below guide to help explain exactly what APR means.

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What is APR?

APR stands for Annual Percentage Rate. When navigating the world of motor finance to purchase your new motorbike, it's crucial that you understand the terms and conditions of your loan, and as important, that we know it back to front so we can assist.

The Annual Percentage Rate (APR) represents the total cost of borrowing on a loan as expressed as a yearly interest rate. It will include not only the interest charged on the original loan amount but any associated fees on the loan.

What does APR mean for Motorbike Finance?

All credit agreements by law must have a clear APR visible on them. When you are deciding which bike to purchase and which bike finance option to choose, the APR allows you to see the total costs you will pay over the course of the bike loan and your monthly payment.

Having this information allows you to compare the potential monthly payment against your budget and allows you to compare offers from different lenders based on the APR figure on offer.

What is the difference between representative APR and exact APR?

You will no doubt see the phrase ‘Representative’ often when searching on the web for your motorbike loan. This is because finance institutions are required to display a Representative APR when advertising so you can see what rate you could expect from a potential loan.

Representative APR is the figure that the lender expects will apply to more than half of their applicants. It’s an estimate, and it's likely that the offer you will receive will differ.

This is because an ‘Exact’ APR is based on your individual circumstances, and not an average based on other customers not associated with you. A representative APR is there to give you an indication, but the only way to know what your true monthly payments would be is to obtain an exact APR.

To gain an exact APR, you will need to go through the application process (Insert hyperlink) so the team at MotoFinance can use the information provided to match you with one of our lenders and get you the best APR rate on offer.

Learn more about APR
The Bike Finance Experts

The MotoFinance team specialise in motor finance, and specifically motorbike finance. We know the industry inside out and are best placed to help you on your journey from a no obligation quote through to getting the keys and the bike on the road.

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Representative Example: Borrowing £4,500 over 48 months with a representative APR of 22.9%, the annual interest rate of 22.9% (Fixed), and a deposit of £0.00, the monthly payment would be £138.94. The total cost of credit would be £2,169.12, and the total amount payable would be £6,669.12.

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Motofinance is a trading style of Scott Hardy Ltd, which is authorised and regulated by the Financial Conduct Authority (FRN: 928906). Registered in England and Wales with Company Registration Number 12678451. The registered address is 4A Mottram Way, Macclesfield, Cheshire, SK10 2DH. Scott Hardy Ltd is also registered with the Information Commissioner's Office (Registration Number ZA773591). All finance is subject to status and income. We act as a credit broker not a lender. We work with a number of carefully selected credit providers who may be able to offer you finance for your purchase. We are not an independent financial advisor and we act as their agent for this introduction. We do not charge you a fee for our services. Whichever lender we introduce you to, we will receive commission from them (either a fixed fee or a fixed percentage of the amount you borrow). For your reassurance, all of the lenders we work with could pay commission at different rates, but the commission we receive does not influence the interest rate you will pay. Our aim is to secure finance for you at the lowest interest rate you are eligible for from our panel of lenders. We will inform you what the commission amount is in good time before the Finance agreement is executed. By continuing to use the site, you consent to the use of cookies. Further information on cookies and how to disable them can be found in our cookie policy.