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What is a Balloon Payment Car Loan?

Sep 26, 2023 | Finance Tips

If you’re in the market for a boat or jet ski, chances are that you’re in the market for a loan as well.

If you have bad credit, it may still be possible to access the finance you need to make your nautical dreams come true. Read on to find out what you need to know about applying for boat finance with bad credit.

How can I get my boat financed’ with bad credit history?

You may have a bad credit score if you have had issues repaying debts in the past, even if you’re now in a better financial position. The good news is it doesn’t need to impact your boat finance application.

The best way to increase your chances of approval for boat finance when you have bad credit is to apply to a lender who specialises in boat financing for bad credit — like Finance One.

If you don’t know your credit score, you can check your credit report for free online with credit reporting agencies like Illion, Equifax and Experian.

Will applying for boat finance damage my credit rating further?

Your credit score is impacted every time a lender completes a ‘hard enquiry’ on your credit file. Hard enquiries are generally undertaken when an application for finance is submitted, regardless of whether it’s for an unsecured loan, car loan, boat finance or personal loan. This is why it’s hugely important not to submit multiple applications for credit.

If your application is assessed and then rejected, this will be listed on your credit file and will likely diminish your credit score — this will subsequently make future applications even trickier to get approved. That’s why it’s important to apply with a lender, like Finance One, which specialises in boat finance for people with bad credit.

Top tip

Make sure you avoid applying with multiple lenders in the hope of getting one to approve you. This has the potential to significantly diminish your credit score.

What type of boat financing (bad credit) is available?

Boat finance for bad credit works like any other type of loan. You take out a loan for an agreed term, and then you make regular repayments to pay off the borrowed money during the term. Your repayments cover the amount you borrow plus interest and loan fees.

Setting up direct debits for your boat loan repayments is a good way to help you avoid missing any. If you borrow from Finance One, it’s possible for you to make extra repayments on any personal loan, or increase your regular repayments during your loan term if you want to. This way, you may end up paying less interest and paying off your loan faster.

What are interest rates on secured boat loans with bad credit?

Boat loan rates is determined on a case by case basis and depends on a range of factors, including market interest rates, your credit score and whether or not you take out a secured loan. Secured boat loan interest rates are generally lower than unsecured rates, however, whether a fixed interest rate is available will depend on the lender.

Can I lower my loan repayments on a secured boat loan?

The loan repayment amount depends on the amount of money you borrow, the interest rate and the length of the loan term. To reduce the loan repayments, you’d need to change any one of these factors. Repaying your loan over a longer term means that the monthly repayments are lower, however, the interest expense will typically be higher because the loan accrues interest for a longer time.

What sort of boats can you buy with boat finance?

With boat finance ranging from $5,000 to $75,000* at Finance One, you may be able to buy any sort of marine vessel, including sailing, fishing, water skiing and motor boats, as well as tinnies and jet skis (new or used). This is subject to acceptance from Finance One.

What do you need to apply for a bad credit boat loan with Finance One?

Our online application form is quick and easy**. When applying for finance for a new or used boat, you will need to supply the following documents:

  • Proof of identity (e.g. your driver’s licence).
  • Proof of your income (e.g. your most recent pay slips or tax return if you’re self-employed).
  • Your bank statements for the last three months.

You need to be over the age of 18 and receiving regular income (including any pension or Centrelink income if you receive any).

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Frequently asked questions about boat loans

Can I use an unsecured personal loan to purchase a boat?

Unsecured personal loans can generally be used for any purpose the borrower intends. Because the finance is not secured by an asset, there are no requirements on how the money must be used (depending on the lender). If you’re thinking about pursuing an unsecured loan amount, keep in mind that they generally have higher interest rates than their secured counterparts.

Do I need boat insurance?

Depending on the terms of your secured boat loan, you may be required to have boat insurance. Insurance helps to protect you against financial loss in the event that your boat is damaged or stolen, and is worth considering regardless of whether it’s a requirement of your loan agreement.

What interest rate will I get on my boat loan?

At Finance One, we offer a personalised interest rate based on each individual borrower’s personal circumstances. Rates are offered on a case-by-case basis, so we’re well-placed to provide competitive interest rates for borrowers with varying requirements — including bad credit.

Can I pay off my boat loan sooner?

At Finance One, we do not charge early repayment fees on our consumer loans. So if you decide you’d like to make extra repayments to pay off your loan early, you will not be penalised.

Normal lending criteria apply. Fees and charges are payable. Terms and conditions apply.

Finance One means:
Fin One Pty Ltd – ABN: 80 139 719 903
Australian Credit Licence: 387528

*Loans between $50,000 – $75,000 must be asset backed.
**48 hour approvals subject to satisfactory documentation being provided to assess the application.

Disclaimer: The information above is of a general nature only and does not consider your personal objectives, financial situation or particular needs. You should consider seeking independent advice regarding your legal, financial, taxation or other needs, to check how the information relates to your particular circumstances. We do not accept responsibility for any loss arising from the use of, or reliance on, the information. All loan applications are subject to normal lending criteria. Fees and charges payable. Terms and conditions apply.

What is a Balloon Payment Car Loan?

Sep 26, 2023 | Finance Tips

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Makala Elliott

Makala is the Marketing Manager at Finance One. She has worked in the Finance and Lending industry for over 10 years, gathering a wealth of experience. She is passionate about helping Australians get back on track with their finances by passing on her knowledge.

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