21
Jan
2020

The process of applying for a boat loan

In today’s world, with the economic crisis lurking about, it is not easy to purchase a boat head-on. Not many people can afford to purchase the boat with a straight payment. Even those who can afford that, tend to find alternative ways to finance their boat purchasing. Generally, for most people the head-on purchase of a boat will lead to utter bankruptcy, thus they are always looking for some other way to get to a boat. So, we come to a conclusion that financing options (like loans, leases, etc.) are an absolute necessity today.

The process of applying for a boat loan 1

The most common way to obtain a loan, or any other type of financing option, is to go to the bank, or any other kind of financial institution, and ask for a loan. Nowadays, it is also possible to get loans over the phone, and even online. These are made to make it easier to get to loans, without going through the pain of application process, but the problem is that not everyone can have access to online loans or phone loans. Some people must go through the application process, because they are not in a perfect financial situation that is required in order to get online or phone loans.

These people have to collect certain documentation, and present it to the relevant person in the bank who is to evaluate whether the potential borrower has met the predetermined requirements for the loan. This is done because the lender (the financial institution) has to be sure that the borrower will be able to return the money given, since losing money is not in the interest of any institution that is in the financial market.

The process of application

When applying for a loan, there are three ways that you can do it. One is to go to the financial institution in question, second is to take it over the phone and the third, which is getting more popular, is to take a loan online. The amount of information required is tied to the value of the boat you want to purchase. The more it costs, the more information is required in order to be accepted for the loan. The most usual information required for taking a boat loan are the following two things:

Proof (usually copies) of the tax returns that were made up to 2 years before the loan is being taken

The applicant’s finance statement, in which the financial institution can see how much the borrower is earning monthly, and decide what the acceptable amount to be lent is.

These are required in order to make the loan offer as acceptable for the borrower as possible. It is expected that the borrower will be cooperative, as it is in his or hers best interests, should they really want the loan.

More information is required concerning the boat in question. The financial institution has to know what they are giving you the money for, and so, they will ask for the information about the boat that you wish to purchase. They can also give you advice from the financial point of view as to whether or not your financial situation allows you to purchase that boat. They will ask for things like the model of the boat, the brand, whether or not it has accessories and optional parts, etc. The point of this is to calculate the value of the boat. When trying to calculate the value of the boat, one should have in mind the following things:

– The price of the boat

– Number of upgrades and accessories and their cost

– Taxes that are required to be paid for the whole transaction

– Registering, entitling and the price of any other documentation required to complete the purchase process

The next step is for the borrower to sign the loan application. This is required in order for the financial institution to be able to check the credit balance of the borrower, as they are required by law to have the borrower’s permission for this. If the loan application is done over the phone, the whole conversation is recorded, thus the institution has verbal confirmation from the borrower to go through his credit balance.

Depending on the financial situation of the borrower and the price of the boat that is to be bought, the application process may either be long, frustrating and tiresome, or it can be very easy. Before deciding to take the loan, the borrower should check the information that he or she is to supply, thus preparing him or herself for the process and its duration and difficulty.

Author Bio:

Ivan Dimitrijevic writes about business and finance tips. Among other things he had articles published that consider a wide range of topics that include boat loans and financing, for companies like Aussie Loans. Ivan writes on a variety of other topics including social media, finance blogging and online business. He is married, with a 4 years old daughter and he enjoys sport, entertaining, and spending time with family.

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