6 Financial Questions To Ask Before Buying A Boat

Wouldn’t it be nice to cruise down the river or hit the sea in your very own boat?

Buying a boat is exciting! But as you draw closer to making the purchase, you’re naturally going to have some questions about the financial side of boat ownership.

We’ve compiled a list of six questions you should always ask yourself before buying any boat. Answering these questions will help you feel more confident about the process and avoid any unwanted surprises later on.

How Much Will The Boat Cost?

The upfront cost of purchasing a boat in Australia will depend on what type of boat you’re looking for, whether you’re buying new or used and the condition of the boat.

Once you have an idea in mind of what type of boat you want, you can look through online boating marketplaces like Boats Online and Trade A Boat to search boats and get a clearer idea of pricing.

What Other Costs Should I Consider?

Aside from the upfront cost of purchase, boat ownership involves numerous other costs. Some costs that you will incur upfront and other ongoing costs as well.

Some of the main expenses to be aware of include:

• Maintenance and repairs
• Storage
• Accessories
• Registration and insurance
• Fuel costs
• Finance repayments

We wrote another article about the cost of boat ownership in Australia, which goes into more detail on these costs. You can read that article here.

Should I Finance The Boat?

Being a relatively expensive purchase, it’s very common for people to take out a loan when buying a boat.

If you have the cash available to pay for your boat, that’s certainly an option and will save you from paying interest on a loan. But there are still advantages to financing even if you do have the cash available.

Financing the boat allows you to spread the upfront cost over a longer period. This means you can keep more cash aside for other purchases, investments and a rainy-day fund. If you don’t have the cash available to buy outright, then a loan allows you to get out on the water faster.

How Can I Get Finance?

Your three main options for getting finance for a boat are – through a dealership, through a bank or going to a finance broker like Credit One.

If you’re buying your boat through a dealership, using their in-house financing options may be a convenient solution. But you should be aware that dealerships usually only have access to a limited number of financing options. So you may not get the best deal available.

When you apply through a broker, you will have access to an extensive panel of lenders and the broker can find the best loan for your personal circumstances.

You may also wish to apply for a pre-approval on your boat loan so you know how much you’re able to borrow before you start your boat search.

Read Our Tips For Getting Your Boat Loan Approved

How Much Can I Afford To Borrow?

Assuming you decide to finance your boat purchase, it’s important to consider what amount you can afford to borrow.

When you take out a boat loan, you will generally make repayments over a period of 1-7 years. You can use an online repayment calculator to calculate roughly what the repayments would be and make sure this is something you can fit in with your other living expenses.

Will I Be Able To Get Finance For A Second-Hand Boat?

If you’re planning to buy a used boat, some banks and lenders may not be willing to offer finance. However, it certainly is possible to get a loan for a second-hand boat.

A broker like Credit One will be able to help you find a lender willing to finance the purchase. Keep in mind that interest rates for a used boat will generally be higher than a brand-new boat.

Ready to get out on the water? Begin a no-obligation finance enquiry today to get started!