Known for competitive interest rates, repayment flexibility, and tax benefits – boat chattel mortgage has a strong reputation for financing marine items predominantly intended for business use.
When considering what financing option to use when looking to upgrade or expand your business’ marine product inventory, it’s important to assess which lender is going to give you the most bang for your buck.
At Jade Finance, each boat chattel mortgage is individually sourced by our expert brokers from across our 80+ lenders, ensuring buyers that their best interests are addressed in covering the market to find them the best secured boat finance.
Chattel mortgage is generally one of the only ways a business can acquire an asset and use it immediately.
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Many finance brokers consider it to be one of the best ways to finance a product predominantly intended for business use. As with regular chattel mortgages, chattel mortgage boat financing has a variety of additional benefits that contribute to its advantageous financing reputation. These benefits include competitive interest rates, flexibility in repayment terms, tax benefits, potential for GST credits, and depreciation claims.
By opting for chattel mortgage boat financing, a business can often save capital because it can potentially access lower interest rates. This is because a boat chattel mortgage is a secured loan type and provides the borrower with the option of a fixed or variable interest rate.
As the names suggest, a variable interest rate means a business’ loan repayments will fluctuate in accordance with interest rates, and a fixed interest rate means the repayments will stay consistent throughout the loan period.
Unlike many loan products in the market, boat chattel mortgage allows business owners and operators to choose whether to pay more or less each month based on their cash flow. This flexibility is beneficial for businesses who experience seasonal changes in their income. An additional degree of flexibility is the option of a balloon payment. With a balloon payment, business owners are able to make a lump sum payment at the end of the loan, which acts to decrease their monthly repayments over the loan term.
After securing a boat with chattel mortgage, a business may be able to deduct the interest paid on the mortgage as a business expense. This means the taxable income would be reduced and therefore the overall tax liability would be lowered.
Goods and Services Tax, or GST, is a tax that is part of purchased goods or services. With a boat chattel mortgage, if the boat is used entirely for business, a GST credit can be reclaimed for each repayment made. This is because the boat is considered to be a ‘capital purchase’ (a business asset). If the boat is not used entirely for business purposes, there is still potential to claim some GST credit.
Depending on how often the boat is used for business purposes, a business may also be able to claim back the depreciation value of the vehicle at the end of the tax year. Depreciation refers to the reduction of an asset’s value over a period of time as a result of wear and tear. However, It’s important to note that depreciation will often have a maximum purchase price as well as a capped amount of GST that can be credited.
Our loan specialists will assess our long list of lenders to find the best interest rates, terms, and eligibility requirements for you. Your dedicated expert broker will then present the best lender options for your circumstance and an application form will be completed on receipt of the following documentation:
Our guides offer quick comparisons and simple explainers to help you rise above the financing process with confidence.
Securing a boat with chattel mortgage is considered a sound financing option for a marine product intended predominantly for business. To obtain this form of secured boat finance, the application process involves a number of steps.
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Following the application, the chosen lender will conduct a credit check and evaluate the value of the boat to determine the lending amount. After approval, proof of insurance for the boat will need to be provided to the lender who will prepare all the necessary legal documents including the boat chattel mortgage agreement. The agreement will outline the loan terms like the repayment schedule, interest rate, and any fees and penalties. After signing the agreement, and the lender registering the chattel mortgage with the PPSR, the borrower will receive the loan funds.
The timeline for the boat chattel mortgage process is dependent on the lender, and a borrower’s eligibility and documentation.
From start to finish, our specialist loan brokers could potentially provide secured boat finance approval, agreement, and ability for disbursement within a few days.
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THE COMPARISON RATE IS CALCULATED ON A SECURED LOAN OF $30,000 FIXED FOR A TERM OF 5 YEARS, NEW GOODS, EFFECTIVE 19/09/2024 AND SUBJECT TO CHANGE. WARNING: THE COMPARISON RATE IS TRUE ONLY FOR THE EXAMPLES GIVEN AND MAY NOT INCLUDE ALL FEES AND CHARGES. DIFFERENT TERMS, FEES OR OTHER LOAN AMOUNTS MAY RESULT IN A DIFFERENT COMPARISON RATE.
The amount an individual or business will be able to borrow will depend on your borrowing history as assessed by the lender.
No. Securing a boat with chattel mortgage is a financing option for a marine product intended predominantly for business.
Chattel mortgage is a form of financing predominantly for business use where the moveable goods are used as collateral for the loan.
Chattel mortgage boat financing has a variety of benefits that contribute to its advantageous financing reputation. These benefits include:
If you are unable to make your repayments on your boat chattel mortgage according to the terms of the agreement, the lender has certain rights and could potentially repossess the asset. The lender will then sell the goods to recover the money they are owed.
Most boat chattel mortgage agreements will allow you to repay the loan amount early. However, depending on your agreement, there may be fees associated with early settlement.
With a secured boat loan, like a boat chattel mortgage, the product you are purchasing will be used as collateral for the loan. Because the boat is tied to the loan, the loan is ‘secured’ and is considered to be less risky for the lender because they can reclaim the asset if the terms of the loan agreement are not met. In short, a secured loan requires you to provide collateral to the lender which, in the case of marine financing, could be the boat itself.
When completing the application form for a boat chattel mortgage, it’s important to provide your lender with the following information:
Both businesses and individuals are able to apply for a boat chattel mortgage as long as the marine product is predominantly intended for business use.
