Many individuals and business owners will be planning to apply for finance to purchase goods such as boats, cars, motorbikes, caravans, trucks and business equipment this year. Some plans may be made well ahead of the actual purchase while others could be last-minute buys. Whether the plan is to apply for finance before or after the buying decision, there are dates, details and determining factors to keep in mind for 2023.
Factors and events which may make acquiring the goods a more streamlined process, ensuring stock is secured and most importantly in securing the cheapest finance and loans. We share our insights to assist both individuals and business to achieve better finance solutions for 2023.
Tips and Details to Note
Taking on finance and loans to acquire goods and equipment is a major decision for most people. Covering all the relevant details to make informed decisions which are in their best interests. Here are a few aspects of personal loans and business finance to consider:-
- The actual finance products and loan types do not change in structure, features and formats. Secured Personal Loans for cars, boats, caravans and motorbikes have a universal format which generally remain unchanged.
- The selection of business asset finance products such as Chattel Mortgage, Lease, Rent to Own and Commercial Hire Purchase have set formats. This format and structure does not change as such, but tax benefits can change as a result of Government policy. This is clearly demonstrated with the current availability of temporary full expensing which offers changes to tax deductions when assets are purchased with say Chattel Mortgage, but only for a temporary period.
- Individuals should do their research well ahead so they have a good understanding of what is involved when you apply for finance. Lenders offering consumer finance must adhere to laws as governed by ASIC including the responsible lender guidelines.
- Both individuals and businesses can apply for pre-approved loans before making their final purchase decisions. We offer this across our loan portfolio.
- Interest rates can change. When you apply for finance the loan is quoted based on the interest rates that are current at that time. The rates on all types of finance and loans can be impacted by the decisions on the cash rate made by the Reserve Bank of Australia. If planning a purchase with finance in down the track, allow for possible changes to rates.
- Interest rates vary based on the application. The interest rates that are advertised by banks, finance companies and other lenders including Jade Finance, are usually for new goods and for applications by those with a good credit rating. The rate offered when you apply for finance may be different from the one you see advertised by a lender.
- Credit scores and ratings can change with changes in individual and business financial situations. Paying bills on time is one way to ensure the credit score is not downgraded. Stay on top of this and keep the score in a good range to ensure the cheapest rates are offered.
- Having a good balance sheet – whether or personal or business, may contribute to being offered a lower interest rate and an overall better loan. Look at clearing other debts to improve the overall financial situation before you apply for finance.
- Global issues are still disrupting supply chains for many goods. These issues may result in price increases and/or stock availability problems. Buy early or have alternatives to favourite makes and models. Allow for higher prices on new models when finally released when planning finance.
- Research the market for the goods to be purchased so you know exactly what you want to purchase. When buying online and from private sellers especially, be a stickler for best practice.
- Use a Car Loan Calculator before you apply for finance to get a general idea of what loan repayments might be for the price of the goods you are considering. Be fully aware of the limitations of this device.
Interest Rate Outlook
For anyone looking to apply for finance or loans this year, the big question is likely to be what will happen with interest rates? Interest rates in most lending areas including car loans, caravan finance, marine finance, motorbike loans and the various different business finance sectors, can be affected by cash rate decisions made by the RBA Board.
The RBA has stated that it is not on a pre-set path in regard to these decisions and is guided by the available data. In making the December 2022 cash rate decision, the Board considered the arguments for against a higher rate rise, the moderate 0.25% and holding rates steady and unchanged. The decisions may depend on how inflation has been tracking and continues to track along with other economic factors both globally and in Australia.
Dates for the Diary
- Major Boat Shows: if looking to buy at a boat show, check out the key event dates at bia.org.au
- Many of the caravan show dates are locked in and those interested can review our recent article listing the upcoming events.
- Field Days for 2023 can be found at the AAFD register of events.
- RBA Board meetings affect interest rates. Meetings are held on the first Tuesday of February through December with the decision announced around 2.30pm on that day.
- Federal Government Budget is due to be handed down in May each year. Policies announced in the budget may affect personal tax schedules and as such income available for finance as well as business tax measures amongst other issues.
- State Budgets can be relevant to businesses for new work opportunities especially in infrastructure. These budgets are usually announced in May-June and vary per state. Announcements can also affect payroll tax and many other costs.
- End of the financial year is of course 30 June and a time to get organised to submit tax returns. Could mean a tax return for some which could be useful when time to apply for finance.
- Temporary full expensing expires on 30 June.
Contact Jade Finance 1300 000 008 to apply for finance for both personal and business goods.
DISCLAIMER: NO LIABILITY IS ACCEPTED IF ERRORS OR MISREPRESENTATIONS ARE FOUND IN THIS ARTICLE. THE ARTICLE IS PREPARED AND PRESENTED FOR GENERAL INFORMATIVE PURPOSES AND IS NOT INTENDED TO BE THE SOLE SOURCE OF INFORMATION FOR MAKING FINANCIAL DECISIONS. THOSE REQUIRING GUIDANCE AND ADVICE SHOULD CONSULT A FINANCIAL ADVISOR.