The pandemic has drawn many into boat-owning and along with that, the prospect of applying for a boat loan for the first time. For some, primarily the younger set, that could be applying for finance for the first time in their life. It could be a loan for a jet ski or other PWC, a wake boat, trailer fishing boat or a runabout to enjoy time on the water with friends. The exhilarating prospect of becoming a boat owner and purchasing that first boat can be a dream experience. But for some at least, the same can’t be said for the experience ahead when it comes to securing a first boat loan.
Most boat buyers will need a loan to purchase the boat, especially if it is a bit of a last minute, possibly unplanned decision. Can’t get away overseas or interstate to holiday at the moment? I’ll buy a boat instead. The process of applying for and being approved for that essential first boat loan can be made a lot easier by understanding what is involved and which lender to contact. As a specialist marine finance lender, Jade Boat Loans provides lender services to both new and long-term boat buyers. We share a few pointers to ensure you are well-informed and prepared to secure your first boat loan.
Consumer Loans – Laws
ASIC is the government body which governs the laws and regulations around all types of consumer loans including boat loans. Boat loans and other forms of credit to individuals for personal purposes is considered consumer finance. Lenders are licensed as Licensed Credit Providers under ASIC regulations and they must adhere to the rules or risk losing their operating licence. Jade Boat Loans is a Licensed Credit Provider and we strictly abide by the guidelines for responsible lenders.
While you might be able to get a boat driving licence before turning 18 years in some states, in order to be eligible for a boat loan you will have to be 18 years or over under ASIC laws. The rulings cover what is required to be provided as part of the application and what information and details the lender must provide to the applicant. The full details of these can be found here .
For those under 18 wanting to buy their own boat or marine craft with finance, they can consider asking someone to be their loan guarantor. This is something that we can assist our customers with pursuing to secure a boat loan. Both parties to the agreement should be aware of what is involved and details can be found at MoneySmart
Credit History, Profile and Score
If this is the first loan applied for by the individual, they may think they don’t have a credit profile. They’ve never set one up and never taken out a loan. But a credit profile is not required to be established by the individual as it is something that is created by lenders, credit card companies and other businesses that run credit accounts.
Even young people that have never had a consumer loan can have a credit profile. Consider what bills are paid each month? Mobile phones, internet connections, gaming subscriptions, BNPL accounts, credit cards, rental payments – these companies can all provide entries to an individual’s credit profile on their payment performance and history.
Worth noting that when a loan application including for a credit card is made, the credit provider/lender can enter the information on the credit profile via credit agencies. Even if the application is not actually followed through and acted on. Multiple applications for the same loan can reflect poorly on the credit profile and subsequent credit score. It can appear as a desperate attempt to source finance. This is one (of many) reasons why using our broker-style services can be of significant advantage. When our consultants consider the broad marine loan market to source the cheapest quote for our customers, such approaches/enquiries are not recorded on a credit profile. Only the application to the selected lender would be.
An individual’s credit profile which includes a score, forms a key part of the application assessment by lenders. So it is essential that in order to get the best and cheapest boat loan, individuals keep their credit profile in good order with a good payment history. To find out how credit scores are derived and how to get a copy of an individual credit report, head to the MoneySmart website.
Sourcing a ‘First Time’ Boat Loan
The options in regard to lenders and loan types available to first time loan applicants are essentially the same as for those who have applied for many loans previously. The difference will be in how the application is assessed and received by individual lenders. Banks and lenders have their own guidelines in regard to eligibility, interest rates, who they will approve and what special terms and conditions may be applied to any particular loan application.
With a vast and diverse lending market, getting across sufficient lenders for quotes in order to arrive at a well-informed decisions as to which is right for you, can be a drawn-out process. The easier way to go is to engage the services of a specialist marine finance broker such as Jade to handle that for you. We have accreditations with many lenders and our consultants know which are more amenable to first time applications and which will extend the best loan offer based on individual loan application details.
The boat-owing dream does not have to become a boat-loan nightmare for first time buyers and applicants. Speak with one of our consultants to secure your first boat loan with a smooth process.
To discuss first time boat loans, contact Jade Boat Loans on 1300 000 003
DISCLAIMER: THE INFORMATION AND SPECIFIC DETAILS CONTAINED IN THE CONTENT OF THIS ARTICLE HAVE BEEN PREPARED AND ARE PRESENTED PURELY AS GENERAL INFORMATION AND NOT INTENDED AS THE ONLY SOURCE OF FINANCIAL ADVICE FOR BOAT BUYERS AND LOAN BORROWERS. FOR THOSE THAT CONSIDER THEY REQUIRE SPECIFIC ADVICE, THEY SHOULD CONSULT WITH A FINANCIAL ADVISOR. LIABILITY IS NOT ACCEPTED IN REGARD TO ERRORS AND MISPRESENTED DATA AND DETAILS HEREIN.