Long gone are the days when people would save for years to buy goods such as boats. In today’s financial environment, when you want to purchase high value item, many people immediately look for securing a loan. Living in an island nation, it’s not surprising that Australians love the water and love their boats. Many people want to own a boat and the lending sector obliges by providing boat loans.
There are different loan products available for the purchase of boats for personal recreational use and for businesses purchasing marine vessels for the business operation.
Personal Boat Loans
A Secured Boat Loan is the most popular form of boat loan and can be acquired by a wide range of people to purchase a wide range of boats. New and used boats, power and sail, yachts, fishing boats, luxury cruisers, trailer boats, racing yachts, jet skis and personal watercraft.
The loan structure is quite standard in format with a fixed interest rate, a fixed monthly repayment and a fixed loan term. The bank or lender uses the boat as security against the loan. So if the borrower defaults, the lender has the right to repossess the boat.
Business or Commercial Boat Loans
Businesses purchasing marine vessels have the choice of a number of commercial finance products: Chattel Mortgage, Commercial Hire Purchase and Boat Leasing. These products vary in their treatment of GST, tax deductions, balance sheet entries and suit different accounting methods. It is important that businesses select the loan type that will best deliver benefits for their individual business structure to achieve their financial objectives.
Marine businesses may include salvage and repair services, recovery and emergency operations, boat charter, hire and rental businesses, water taxis, ferry services, tugboat services, cruise businesses and many other operators in the travel and tourism sector.
Sourcing a Boat Loan
Some banks and lenders offer boat loans but not all. Those that don’t offer specific boat loans may offer applicants, especially personal purchasers, a higher-priced generic loan. Knowing which financial institutions will offer the best boat loan is important to the cost of your loan and ultimately your boating enjoyment or the return on your business investment.
Using the services of a finance broker who has specific expertise in marine finance may be the solution for you. An independent broker who is accredited with multiple banks and lenders is well-placed to survey the wider financial market and source you the best personal boat loan or marine finance deal.
We know people who specialise in marine finance and boat loans. Please contact us if you would like their details.