Entering into a loan agreement is a significant undertaking and all aspects should be considered. At Jade Boat Loans we are committed to educating and informing our customers and potential customers around as many topics as possible in regard to boat loans and consumer finance in general. We want you to be fully-informed and confident in your own understanding of all aspects of your loan. Which brings us to the topic of this article – does a secured boat loan mean it is safe for me?
This is an interesting question and while those in the financial industry fully understand the terminology we use, we also acknowledge some of the terms could be construed differently by different people.
Security and Your Boat Loan
In financial terms, the ‘secured’ reference in Secured Boat Loan refers to the boat being the actual security against the loan. In the finance industry we use the term security to refer to a guarantee, collateral or surety.
When taking out a boat loan with a Secured Boat Loan or buying any consumer goods with a secured loan, the borrower is required to put up security or a guarantee. The lender wants to be assured that should you default on your payments they have some way of recouping what money is owed to them. The boat itself is that security so it could be seen as providing safety for the lender.
When a lender enters a secured boat loan agreement, they register that security or interest in the boat on the PPSR. This is the Personal Property Security Register. It is a register of items such as cars and boats which are being purchased by a loan and the lender holds security over the asset.
When a loan is finalised, the lender releases the security and the entry from the PPSR. This register could be seen as providing a form of safety for buyers of second hand goods and when buying from private sellers. The buyer can refer to the PPSR to see if money is owed on the asset and hence avoid purchasing something which is under finance, which can lead to issues.
Safety for the Borrower
Looking at the other side of a loan agreement, the borrower’s side, the term ‘secured’ is not used in terms of personally safe or safety as such. But it could be seen in that way in some contexts.
The safety for the borrower may be interpreted in that if they are unable to meet the payments the boat is available for the lender to recoup unpaid monies in the event the loan defaults. But if the value of the boat does not meet the full amount outstanding, the borrower may still be liable to pay the difference.
Safety for our Jade customers in terms of arranging a Secured Boat Loan is provided through our adherence to the Consumer Credit Laws and Responsible Lender Guidelines as set out by ASIC. In meeting our obligations in that regard we follow all the protocols and practices deemed as essential in informing consumers of their loan obligations and providing all necessary information.
Another interpretation may be a loan being ‘safe and secure’ for the borrower as being sourced from a reputable lender. Be assured that Jade Boat Loans is accredited with multiple banks and lenders including Australia’s major banks. We ensure the lenders we choose to work with are reputable and reliable.
One condition of taking out a secured boat loan is that borrower must take out an insurance policy on the boat. This is not a condition exclusive to Jade lenders, it is standard procedure across the lending sector.
Safety through Fixed Loan Elements
Another important aspect of our Jade Secured Boat Loans is that we arrange our loans with fixed elements which provide our customers with assurance that the loan won’t change over the loan term.
- The cheap interest rate we source for you will remain fixed for the full term of the loan. So even when you hear the RBA has changed the official cash rate, your loan will not be affected. You won’t have to review your loan in response to such actions.
- The repayments we negotiate on your behalf are also fixed for the full loan term. You will know the amount each month you have to repay will be the same every month so you can budget your other expenses.
- The loan term is also fixed.
Safety on and around Boats
While talking about safety we take this opportunity to stress the importance of safety in boating. Life jackets are required to be carried and you should refer to your state maritime authority for the laws about which particular type of jackets are required for the waters you are boating in.
If you own a trailer boat safety in towing the boat and launching and retrieving at the boat ramp are critical. If you’ve never towed a boat before buying, it is advisable to attend a towing driver course.
Knowing how to operate your boat safely goes behind driving and mooring. Being out on the water poses a different scenario to say being on a road in car. If you have mechanical issues with a car you can usually pull off the road and call a road service mechanic. If you have engine or other gear issues when on your boat, the same convenience is not readily accessible. Knowing how the engine and other gear works and having the tools on board to do ‘running repairs’ can be very important.
We hope this explainer has cleared up any doubts around Jade Secured Boat Loans and you feel confident in moving forward with your loan.
For a quote on a Secured Boat Loan, contact Jade Boat Loans on 1300 000 003
DISCLAIMER: THIS INFORMATION HAS BEEN PREPARED FOR THE PURPOSE OF GENERAL INFORMATION AND IS NOT INTENDED AS FINANCIAL ADVICE OR THE ONLY SOURCE FOR THE PURPOSE OF MAKING INDIVIDUAL FINANCIAL DECISIONS. IF A READER CONSIDERS THAT THEY REQUIRE ADVICE ON THEIR FINANCIAL SITUATION, PROFESSIONAL ASSISTANCE AND ADVICE SHOULD BE SOUGHT FROM A FINANCIAL ADVISOR. NO LIABILITY IS ACCEPTED FOR ANY MISINTERPRETATIONS OR ERRORS IN DATA, CONTENT AND INFORMATION AS SOURCED FROM OTHER PARTIES. THE INFORMATION PRESENTED IS FOR GENERAL INFORMATIVE PURPOSES AND READERS ARE ADVISED TO FOLLOW UP INDEPENDENTLY.