Eligibility for Boat Loans – Know the Ins and Outs of Boat Loan Finance

By: AllenStewart

You can get a boat loan for purchasing a boat for personal or commercial purposes. A boat loan, just like an auto loan, can be structured for meeting your financial needs. In Australia, an average boat costs $20,000. By applying for a boat loan to the extent of $2500, you can buy a small aluminum boat worth $3000 and enjoy good fishing and surfing. The minimum boat loan amount is $10,000. You can avail boat loans from some lenders only if you happen to purchase through an acceptable marine merchant, or in places where there is office representation such as in NSW, Queensland and WA.

You must be an Australian citizen, permanent resident or a person having an approved working visa and should be over the age of 18 years to be eligible for a boat loan. You may not be successful in getting the boat loan if you have poor credit history or if you are bankrupt. Also, you may have to furnish some important details in support of your boat loan application to become eligible for boat loans. These vital documents include details of your income, liabilities and assets, driver’s license as well as you employer’s contact details. The information submitted by you will be verified duly by undertaking a cross check with your employer.

Even if you are self employed, you can be eligible for a boat loan. However you may have to provide your accountant's details in this case. Details pertaining to your turnover and other figures may also be checked by the lender before granting final approval to the boat loan. You may have to pay an establishment fee of $500 during submission of loan application which will be refunded to you in case your boat loan is not approved. However, there are no on-going fees on a boat loan. In some states it is mandatory to pay a stamp duty on the boat loan contract.

A boat loan is generally given for a period of 1-5 years. You must take into account your cash flow before deciding on the term of the boat loan. The longer the loan term and greater the residual value, the less your monthly payments will be. You can also be free from the problem of unpredictability of interest rates because a boat loan is usually given on a fixed-rate basis. You will incur break costs if you plan to repay your boat loan before the end of the term. If interest rates have increased, you may have to pay some form of fee for loss of interest income resulting from the break of your loan contract. If interest rates have decreased then the break costs will be equivalent to the difference between the interest the lender will now receive and what you would have paid under your boat loan. You can also plan to buy a used boat which will work out to be cost effective. However, it is advisable to take up complete research before buying the boat of your choice.

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It is easy to find cheap boat loans in Australia. It makes sense when there are so many boats for sale in our country.

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