In an earlier article at the end of June, we reported that the Big 4 Banks – ANZ, Westpac, NAB and CBA, had swiftly responded to the Sydney lockdown with offers of loan repayment relief. Since then, the situation on both fronts – lockdown and support, has increased. The lockdown in Greater Sydney, Central Coast and Illawarra has been extended into the third week and there is a possibility it may be further extended. Realising the widespread impact that such an extensive NSW lockdown will have on many businesses and individuals both under the health orders and beyond, governments and the banking sector have responded.
In a statement issued on 8 July, the Australian Banking Association (ABA) announced further support for both customers currently in a lockdown situation and for those that are still recovering from earlier lockdown situations.
So what loans and what customers are included in this ‘additional support? If you require repayment relief on your boat loan, are you entitled to the support? We address these questions as far as the information is currently available.
ABA Support Package
The ABA statement states that a national support package has been launched by the banking sector. More information here.
The statement is brief but includes the following detail:-
- Customers will need to apply for support by contacting their bank.
- The information refers specifically to business loans and business customers and home loan customers.
- No specific mention of consumer loans such as secured boat loans has been mentioned. However, in a media interview, Anna Bligh, CEO of the ABA did infer that consumer loan relief was being considered.
- The business banking support package includes deferrals of up to 3 months and the loan term extended by the relevant timeframe.
- Package available for all small businesses which are defined as having a turnover of less than $5 million and lending less than $3 million.
- Business relief is only available for loans ‘in good standing’.
- Merchant terminal fees refunded for up to 3 months.
- Waiver of fees on business cash deposits and some other loans for up to 3 months.
- Support for home loan customers including deferrals.
Ms Bligh said that customers can rest assured that if they need help they will get it and the bank will help customers find a way through. She said that customers should contact their bank.
In a media interview following the release of the media statement, Ms Bligh said that if a customer had previously deferred loans such as during the initial COVID crisis in 2020, then that would not prevent them from receiving assistance this time.
While consumer finance, with the exception of home loans, does not get specific mention in this statement, Ms Bligh did indicate that was being addressed. We will be staying across developments and announcements in this space.
The ABA members include 22 banks, both the four major as well as regional and international banks that hold an Australian banking licence. Jade Boat Loans is accredited with most of these banks and we have sourced your bank loan from an ABA member. If that is the case and you require assistance with your bank loan, you should contact your lender to discuss what assistance is available to you.
Ms Bligh said tailored solutions were being developed for particular customers.
Many of our lenders are non-bank and many of them will be members of the Australian Finance Industry Association. An association that represents a diverse range of organisations including lenders in consumer finance.
The AFIA has also issued a statement offering continued support to customers during COVID. CEO Diane Tate said that the association’s members urge customers not to ‘go it alone’. If customers are experiencing difficulties in regard to their loan due to the impacts of the COVID situation, they should contact their lender.
The AFIA statement states that lenders will be working with customers on relief measures with possible solutions including:-
- Repayment deferrals or reductions in repayments
- Waiver of fees
- Refinancing and restructuring
- Redraw and line of credit solutions
So the message is clear across the lending sector – your lender is available to support you through this situation. Individual solutions will depend on individual lenders and customer requirements.
Getting Assitance With Your Boat Loan
If you are experiencing difficulties in meeting your boat loan commitments due to issues related to the COVID-19 pandemic or for any other reason, don’t delay contacting your lender to discuss a possible solution. By not being proactive and simply choosing to miss repayments, thinking it won’t really matter, borrowers, are overlooking some key conditions regarding consumer finance.
Missing repayments, no matter how few or how small the payment amount, can result in the loan being in default. The end result being possible repossession of your boat and long-term damage to your credit profile. Issues that can impact your potential to access credit of many types in the future.
Consider your options if you are experiencing challenges:-
- Contact your lender to discuss deferrals.
- Contact Jade Boat Loans to discuss the possibility of refinancing an existing boat loan to achieve a lower repayment amount.
- Exiting an existing loan by selling the boat. Finalising a boat loan prior to the scheduled end of the loan term can attract break fees.
No doubt all Australians are hoping the current coronavirus outbreaks are quickly contained and all can move to a more workable lifestyle and enjoy getting out on the water.
To discuss marine finance, contact 1300 000 003
DISCLAIMER: THE INFORMATION AND SPECIFIC DETAILS CONTAINED IN THE CONTENT OF THIS ARTICLE HAVE BEEN PREPARED AND ARE PRESENTED PURELY AS GENERAL INFORMATION AND NOT INTENDED AS THE ONLY SOURCE OF FINANCIAL ADVICE FOR BOAT BUYERS AND LOAN BORROWERS. FOR THOSE THAT CONSIDER THEY REQUIRE SPECIFIC ADVICE, THEY SHOULD CONSULT WITH A FINANCIAL ADVISOR. LIABILITY IS NOT ACCEPTED IN REGARD TO ERRORS AND MISPRESENTED DATA AND DETAILS HEREIN.