Buying a boat is a big responsibility and can be a significant expense, so finding the right financing option is crucial. There’s a lot to understand when it comes to finding the best boat loan options in Australia. You’ll need to look at the interest rate offered, the term of the loan and any extra fees or expenses attached. Comparing all these factors will help you find the best boat loan for your financial situation. Before you know it, you’ll be out on the waves!
Understanding Boat Loans
Boat loans are a type of personal loan created specifically for those who want to buy a boat. That boat can be any type of water vessel – speedboat, yacht, fishing boat, houseboat or jet ski. You can also use your boat loan to cover boat-related expenses, such as maintenance, fuel, mooring costs or updating safety equipment. However, the main purpose of the loan should always be to buy a boat.
At Handy Finance, our boat loans can cover purchasing brand-new and secondhand boats. Used boats are a viable option if you’ve landed on a smaller budget for your boat purchase.
Loan terms and amounts for your final boat loan will differ based on the lender you choose – at Handy Finance, you can apply for a boat loan between $2,001 and $75,000, with terms of one to seven years.
Unsecured vs Secured Boat Loans
At Handy Finance, we only offer secured boat loans. A secured boat loan is where the boat you purchase is security for the loan. If you cannot repay your loan and default, the lender can repossess your boat to recoup losses.
There is less risk involved in this type of loan, which is why we offer secured boat loans at Handy Finance. With this security, we can approve higher loan amounts with more competitive interest rates.
An unsecured boat loan doesn’t require you to use your boat as collateral. This type of loan involves slightly more risk for lenders, so borrowers may be restricted to smaller loan amounts and higher interest rates from lenders.
What to consider when you compare boat loans
In your excitement to purchase your dream boat, settling for the first deal can be tempting. Like with any big purchase, it is important to consider how different boat loan rates and terms stack up against each other before securing your loan. Here are some of the essential factors to review before deciding on your boat loan provider:
- Interest rates: everyone wants a competitive interest rate on their loan, no matter what the money will be used for. Your loan’s interest rate will greatly impact the loan’s overall cost and will be directly built into your repayment plan. At Handy Finance, our credit experts determine the interest rate based on your financial circumstances. The interest rate is tailored to you and fixed, meaning whatever payments you make will be the same across the lifetime of your loan.
- Loan terms: these are another essential factor to review before deciding on your final loan options. The loan terms will vary widely depending on the provider you are looking at. Handy Finance offers boat loans with terms of between one and seven years, which can be paid off in weekly, fortnightly, or monthly instalments.
- Fees and charges: do your research very carefully, as this is where many applicants can be caught out. The cost of upfront fees or charges can sometimes outweigh the benefit of a lower interest rate, for example. At Handy Finance, we understand that extra fees can add financial stress, so we are very transparent about the charges involved with our boat loans. When you take out a boat loan from Handy Finance, you only need to pay an establishment fee. There are no ongoing or early repayment fees on any Handy Finance loan.
- Reputation: who you borrow with is incredibly important. There are many brick-and-mortar banks, online banks and peer-to-peer lenders that offer boat loans. Ensure you are borrowing from a reputable source before applying for a loan. You can read more about the risks of peer-to-peer lending here.
Boat loans: features and benefits
There are several benefits to taking out a boat loan with Handy Finance to fund the purchase of your dream new or secondhand boat:
- Flexibility: at Handy Finance, our boat loans are tailored to your financial situation. Our credit experts review your application and provide loan terms and interest rates tailored to you and your budget, providing you with a way to purchase a new or used boat without the stress of being unable to make repayments.
- Fixed repayments: all Handy Finance loans come with a competitive fixed interest rate, meaning any repayments are a fixed sum for the loan’s lifetime that takes into account all factors. Whether you’re repaying on a weekly, fortnightly or monthly schedule, you will be able to accurately budget accordingly.
- Tailored loan terms: one of the reasons that Handy Finance can offer such competitive boat loan rates is that all boat loans are tailored to your circumstances. The loan term, final loan sum and interest rate are all approved based on what our credit experts have learnt from your application.
Some lenders also provide loans with the following features:
- Balloon payments: some lenders will allow you to use a balloon payment with your boat loan. This involves paying off most of the loan in a lump sum at the end of your loan term. Your regular repayments will just be the interest earned during that time. Handy Finance does not offer loans with balloon payments – but we can help you refinance a balloon payment from another lender. Using one of our debt consolidation loans, you can apply for financing to pay off your balloon payment in full and then pay back the lump sum in manageable repayments spread over your preferred repayment schedule.
The Handy Finance Boat Loan Calculator
Many of the best boat loan providers will have a loan calculator available, which you can use to estimate your borrowing power. You can plug in your ideal loan amount, loan term, repayment frequency, and credit rating. The calculator will provide you with an indicative interest rate and repayment sum. It’s a useful tool for working out your boat budget and seeing in real numbers what taking out a loan will mean for you. You can use Handy Finance’s boat loan calculator online today.
Applying for a boat loan: the requirements
Applying for a boat loan is easy. At Handy Finance, you can submit your application online. You’ll fill out the application form and submit ID and three months’ worth of bank statements through the Illion Bank Statement service. These documents need to prove you meet the eligibility criteria. To be eligible for a boat loan:
- You must be 18 years or older
- You must be currently employed (including self-employment)
- You must be an Australian citizen or permanent resident
- You must not have a history of bankruptcy or have any outstanding defaults with other financial institutions
- You must not be a party to a court judgment.
Securing the best boat loan for you
So, how do you secure the best rate on your boat loan? Here are a few suggestions:
- Understand your credit score: your credit score has a direct impact on the final interest rate you’ll be offered by Handy Finance. Before applying for a loan, you might want to consider requesting a credit report. This can give you an indication of what your credit score will be. Having this information allows you to plan – if your credit score is lower than you thought, you can start to make changes to improve it. You can find out more about credit scores on our Handy Finance blog.
- Do your research: Have a clear understanding of the type of boat you want to purchase and the budget you’ll need to buy it. This will make it easier to use tools like the Handy Finance Boat Loan Calculator to get an idea of your buying power and ongoing financial commitment. Our loan calculator can help you accurately weigh your options before submitting your final application.
Choose Handy Finance for fast, flexible and fair boat financing
You can trust the team at Handy Finance to provide affordable, fair options for boat financing. We offer boat loans of $2,001 to $75,000 with loan terms between one and seven years. Our seamless online application process makes it easy to submit your paperwork, and receive an indicative decision within minutes.
Remember to research before applying for a boat loan – use the Handy Finance Boat Loan Calculator to gain an idea of your buying power, and consider checking your credit score to ensure your application has the best chance of succeeding.
Contact our credit experts at Handy Finance today to learn more about some of the best boat loans in Australia.
