How To Finance An ATV In Canada

If you’re a thrill or adrenaline seeker, the thought of owning your own ATV may sound appealing. However, an ATV can cost thousands of dollars, which most people don’t have. Thankfully, you can still own an ATV if you finance it.

Key Points You Should Know About ATV Financing

• The cost to finance an ATV varies based on several factors, including the loan amount, loan term, down payment, and interest rate.
• You can get financing through your bank, credit union, alternative lender, or sometimes directly from the manufacturer.
• Insurance and licensing may or may not be required, depending on where you live and how you use your ATV.
• Many additional costs are involved in owning an ATV, so be sure to budget for these ongoing expenses in addition to ATV financing.

Can You Finance An ATV? 

Yes, you can finance the purchase of an ATV, much like you would any other type of powersport vehicle. The details of such financing can vary slightly between new versus used ATVs.

New ATV Financing

• Warranty: New ATVs come with a manufacturer’s warranty, which covers the costs of various defects and repairs.
• Interest Rates: Manufacturers and dealerships often offer promotional financing rates, even as low as 0% interest for a limited period. Even without such promotions, rates on new ATVs tend to be lower compared to used ATVs.
• Upfront Cost: New ATVs are more expensive, which means a higher loan amount and higher monthly payments.
• Down Payment: The total down payment amount may be higher for new ATVs than for used ATVs because of the higher purchase price. However, the percentage of the purchase may be lower because of the lower risk for the lender.
• Loan Terms: You may be able to get a longer loan term when financing a new ATV.

Used ATV Financing

Whether you want to buy a used ATV from a dealership or a private seller, you can find financing through various lenders. However, lenders may have certain eligibility restrictions such as the ATV age and condition. Moreover, depending on who you work with there may be certain differences between financing a used ATV vs a new ATV, such as: 

• No Warranty: Used ATVs may not have a warranty, especially older models. That means you may have to cover repair costs out-of-pocket.
• Interest Rates: Low promotional financing rates are not as common on used ATVs. Plus, interest rates are often higher. 
• Upfront Cost: Used ATVs are usually cheaper, so you may not need such a big loan. 
• Down Payment: The total down payment amount may be lower than for new ATVs because of the lower purchase price. However, the percentage of the purchase may be higher due to greater perceived risk by lenders.
• Loan Terms: Used ATV financing tends to come with shorter term lengths compared to new ATVs.

How Much Can You Borrow To Finance An ATV?

The purchase price of the ATV will largely determine how much of a loan you need to take out. Depending on the lender and the ATV you’re buying, loan amounts can be as high as $50,000.

What Is The Average ATV Financing Rate?

The interest rate you’re charged depends on a few things, including the loan term and your credit score. Generally speaking, you could pay anywhere from 5.99% to 15%% on average, though you could pay much more if you’re applying with bad credit. In this case, you could be charged upwards of 15% or more.

However, do note that lenders cannot charge you more than the criminal interest rate.

How Long Can You Finance An ATV?

Repayment terms on ATV financing are usually no longer than 7 years, though they may be longer depending on the lender.

Types Of ATVs You Can Finance In Canada

There are several kinds of ATVs you can finance in Canada, including but not limited to:

• Sports ATVs – These are some of the most popular and affordable ATVs. Designed for lighter, faster performance, you’ll often see quad or tricycle models that can carry small amounts of cargo and one or two passengers maximum.  

• Side-by-Sides – Commonly referred to as an SxS or UTV (utility terrain vehicle), an SxS is a more versatile ATV with the capacity to hold more cargo or other passengers. Some UTVs also have roofs or roll cages for added protection. 

• Utility ATVs – Similar to SxS vehicles, utility ATVs are built to transport heavier cargo and extra passengers. However, they’re normally more stable and can navigate tougher terrain. Some even have the lighter design of a sports ATV.

Can You Finance An ATV Through A Dealership?

Many recreational vehicle dealerships offer ATV financing options. The loan is funded “in-house” (by the dealer) or by a third-party provider, like a partner bank, credit union or alternative lender. Loan conditions, interest rates and payment terms can vary according to the borrower’s credit, gross income and debt history.

When financing an ATV through a dealership, be sure to choose a legitimate business with a good reputation so you don’t end up buying a total lemon car.

Can You Finance An ATV Through A Manufacturer?

Recreational vehicle manufacturers may also work with third-party lenders to provide their own ATV financing plans. Some companies offer even better rates than a lot of financial institutions and online lenders. Once again, just make sure to do some prior research and select a brand that’s known for producing reliable vehicles.

Manufacturer’s Financing For ATVs 

While you can find ATV financing from most ATV dealerships, only a handful of ATV manufacturers offer direct financing through their financing department:

How To Apply For ATV Financing In Canada

Applying for ATV financing is a straightforward process. Here are the steps to follow:

Step 1. Check Your Finances

Before you apply for ATV financing, make sure you have the funds necessary to cover monthly loan payments. You’ll also need to have a lump sum of money available to cover the down payment, which must be readily accessible to the lender when you finalize the loan.

Down payments can range from 10% to 20% of the purchase price, though they can be higher depending on the lender and if you’re buying a used ATV.

Step 2. Research Lenders

Look for lenders that specialize in ATV financing. You can apply with banks, credit unions, online lenders, or directly with the dealership. You can also see if you can get direct financing from the ATV manufacturer. Do some comparison shopping to find the best interest rates and loan terms. 

Step 3. Get Pre-Approved

Lenders often offer pre-approvals for ATV loans. This involves a soft credit check that won’t impact your credit score. Getting pre-approved can give you a better idea of your budget and what you can afford. 

You should also check your credit score to see if you meet the lender’s minimum credit requirements. Credit score requirements vary by lender, though ideally, your score should be at least 660 (which is categorized as “good” credit) to boost your odds of loan approval. You can quickly check your credit score for free using Loans Canada’s CompareHub tool.

Step 4. Gather Necessary Documents And Fill Out The Application

Fill out the loan application with your chosen lender. This can often be done online or at a dealership

You’ll generally need to provide proof of income and a photo ID to help the lender verify your finances and identification. This can include things like a driver’s license, pay stubs, and bank statements. Having these documents ready when you apply can speed up the application process.

Step 6. Finalize Your Financing

Once you’ve chosen your ATV and lender, it’s time to finalize the loan. In this step, you’ll sign the loan contract and arrange for the money to be disbursed to the party you bought the ATV from.

Can You Finance An ATV With Bad Credit?

Yes, you can finance an ATV even with bad credit. While you may not have much luck if you apply with a bank, some lenders specialize in providing loans to consumers with poor credit scores, such as private and alternative lenders. These lenders may place more weight on other factors, such as your income or collateral. 

That said, they typically charge higher interest rates to offset the increased risk of lending to a bad credit borrower.

Can I Get An ATV If I’ve Declared Bankruptcy?

Yes, you can still get an ATV even if you’ve declared bankruptcy, but it will be more difficult. Your credit score will take a significant hit after filing for bankruptcy, and your credit report will be noted accordingly for 6 or 7 years. 

During this time, you may need to work with a lender that specializes in catering to borrowers who have a history of bankruptcy.

Can I Get An ATV If I’ve Filed A Consumer Proposal?

Yes, you can get ATV financing if you’ve filed a consumer proposal. But like bankruptcy, a consumer proposal will severely impact your credit score, and your credit report will reflect an R7 note for several years. During this time, it will be difficult to get an ATV loan from a traditional lender. 

In this case, you should look for a lender that deals with consumers who have filed for a consumer proposal in the past. They may place more emphasis on other factors besides your credit score, though you’ll pay a higher interest rate in return.

Calculate Your ATV Loan Payments

Before searching for an ATV to buy, crunch the numbers to determine what you can comfortably afford. 

Luckily, ATVs don’t cost as much as other powersport vehicles, like boats and RVs. But some of the higher-end models can run you upwards of $15,000 or more. The overall cost of your ATV will depend on various factors, including the following:

• Age: Older models may be cheaper than new ATVs. Just as is the case when you buy a new versus used car, the age of your ATV will directly impact the price.
• Condition: An ATV in excellent condition will command a higher price than a model that needs extensive work to bring it up to par. 
• Features: There are tons of accessories you can add to your ATV, all of which can increase the price, including:
  • Racks
  • Storage
  • Windshields
  • Handguards
  • Wheels
  • Bumpers
  • Plows
  • Lights
  • Track kits
• Type Of ATV: There are different types of ATVs, each of which varies in price ranges, such as the following:
  • Sport ATVs
  • Recreation ATVs
  • Hunting ATVs
  • Youth ATVs

Leasing vs. Financing An ATV

If you don’t have the funds to buy an ATV upfront in cash, you may consider financing or leasing. Here are the major differences between the two:

Additional Factors To Consider When Purchasing An ATV

There are a few additional factors to consider before you buy an ATV:

Do You Need A Special License To Drive An ATV In Canada?

Whether you require a license to drive an ATV depends on where you drive it and where you live:

Private Property

Off-road ATVs used on private properties typically do not require a license to operate. However, some areas may have additional rules. Check with your municipality about licensing requirements for ATV use on private land in your region. 

Recreational Trails

Licensing requirements to drive ATVs on recreational trails may vary based on location. Some trail systems require drivers to have a regular driver’s license, while others do not. For example, Quebec requires that drivers have a valid permit to operate an ATV on a trail maintained by off-road vehicle clubs in the province.

Public Roads

There are several regulations surrounding driving ATVs and other off-road vehicles (ORVs) on public roads. For example:

• Driving an ATV on public roads is prohibited (except in special circumstances) in Quebec. Moreover, if you must drive on public roads, you’ll need a driver’s license to operate an ATV.
• In Ontario, you can only drive an ATV and other ORVs on certain public roads. 

How To Insure An ATV In Canada

Insurance on an ATV may or may not be required, depending on where and how you use the vehicle.

Your Private Property

Insurance is typically not required in most provinces if you plan to use your ATV on your own property. However, Quebec requires at least third-party liability insurance in case somebody gets hurt while riding your ATV or if the vehicle causes property damage. 

Public Roads And Trails

Driving an ATV on public land and trails typically requires some form of insurance.  

ATV Maintenance Costs

There are plenty of costs associated with owning and operating an ATV in addition to the purchase price. Be sure to budget for ongoing expenses, including the following:

• Fuel
• Oil changes
• Battery replacement
• Winterization
• Storage
• Accessories (ie. helmet, gloves, etc)
• Tires

Additional Reading

Car Sales Tax On New And Used Vehicles In Canada

Is Buying A Car Online The New Norm? Canada Drives vs. Clutch vs. Cardoor

What Are Car Safety Ratings And How Do You Check Them?

ATV Financing FAQs