While many buyers jumped in to buy boats and caravans in time for the holiday season, there are still many that are sure to have plans to buy in 2023. Most boat and RV purchases require boat loans and caravan finance and buyers should know their consumer finance options especially achieving cheaper rates. The interest rate is critical to the overall cost of the loan and the monthly outgoings. But achieving the cheapest interest rate loan may be made easier with a full understanding of many aspects of consumer finance.
Both boat loans and caravan finance for purchases for private use as opposed to business use, call under the category of consumer finance. Many of the aspects of these loans are similar and often lenders will offer them under Leisure Finance or Recreational Loans. To assist buyers make those well-informed buying decisions, we provide this summary of key points to note.
Boat and Caravan Types
Jade Finance essentially offers finance for all types of new boats and RVs. Our reference to ‘boats’ includes tinnies, yachts, PWCs, cruisers both small and large, power and sail vessels and even house boats.
In regard to the RV market, our reference to caravan finance will be suited to all types including toy haulers, the traditional caravan, camper vans and trailers, motorhomes, toy haulers and even expedition vehicles. This includes off road and on road models.
Finance for used models can vary for the loan offers on brand new models. This would depend on lender acceptance of the goods as suitable security and the interest rate may also be different for second hand goods.
The most popular type of loan for new boats and caravans is a secured loan - Secured Boat Loan and Secured Caravan Finance. The format for both is the same in that the goods become the security for the loan and the borrower repays the loan in equal monthly repayments over a set loan term.
To ensure those repayments remain unchanged, we secure secured loans of this type with a fixed interest rate and with a fixed finance term.
With a secured loan, lenders will require the goods to be fully insured. The cost of insurance should be considered in the overall purchase expense. We may be able to assist with Marine and Caravan Insurance.
Consumer Finance Eligibility and Regulations
The consumer finance market in Australia is regulated by ASIC. Loan applicants should be aware that banks and lenders that do offer loans of this nature must adhere to the regulations and laws. Lenders must also be Licensed Credit Providers. When considering any loan offer, buyers should ensure the lender is fully licensed in this regard.
Under the law, loan applicants must be over 18 years of age. Where an under 18 year old wants to take out say a boat loan for a jet ski, options for guarantors may be considered. Speak with us about how we may be able to assist with options.
Consumer Loans Market
Loans for boats and caravans are available through numerous lender sources. These include banks, some finance companies, marine dealers, caravan manufacturers and of course broker-style lenders such as Jade Finance. Not all lenders list specific boat and caravan loans in their consumer finance portfolio. These goods are often financed through a more general Personal Secured Loan product.
The difference between applying directly to a bank or finance company or using dealer finance and utilising the benefits of our broker style services should be appreciated. Finance broker services are not reserved for the exclusive privilege of businesses or of high-wealth individuals. Our services are available to all buyers that require loans to purchase boats and caravans.
Rather than only being dependent on one lender for offers for our customers, we have what is known as accreditations with multiple lenders. That accreditation is the lender’s approval for our consultants to source loans from them for our customers.
We cover off on many lenders when sourcing boat loan and caravan finance offers for our customers to ensure we secure the cheapest rate and outcome.
The Interest Rates Situation
When looking for boat loans and caravan finance, most will hone in on the interest rate being offered. Note that the best rates offered will be based loans for new boats and new caravans and for loan applicants that have a good credit score.
Rates for consumer finance can be impacted by changes in the cash rate as announced by the Reserve Bank of Australia. But the changes and the rates themselves can vary from bank to bank, finance company to finance company.
Those with plans to buy in 2023 will no doubt want to know what will happen with interest rates in the months ahead. The exact answer is – it is unknown. The RBA Board make their monthly decisions based on the economic data available and has repeatedly said it is not a pre-set path in regard to interest rates.
At its December meeting, the RBA Board did weigh up the options of no increase, a hike of 0.5% and the smaller rise of 0.25%, which was ultimately decided upon. So numerous options are on the table when the Board next meets in early February 2023.
How to Effectively Use a Finance Calculator
The availability of free-to-use finance calculators is a great plus for boat and caravan buyers requiring finance. Buyers can utilise this tool to get rough repayment estimates on different prices to assist with buying and budgeting.
But these calculators do have certain limitations as generic devices and users should use them as intended to achieve the best outcomes. Most importantly, users should realise that the interest rate that they may be offered, could be differ from our best current interest rate. In addition, depending on the buying timeframe and upcoming RBA decisions, interest rates in general could change before the loan application is submitted and any offer made.
Buying at Boat Shows and Caravan Expos
If planning to buy at a caravan expo or boat show, pre-approved loans can be a great help. Speak with us in the weeks before the show to get your loan quoted and approved and ready to use when the perfect model is decided on.
There is clearly a lot more to know about boat loans and caravan finance than we can cover here. But if you have any specific questions, please reach out to the Jade Finance team for answers. Contact Jade Finance 1300 000 008 for caravan finance and boat loans at better interest rates.
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.