Boat Motor Financing: Inboard & Outboard Motor Loans
New or used boat motor loans to power or repower your boat!
Financing a boat engine in Australia is similar to financing any other type of vehicle or equipment. However, not all lenders will finance boat engines, and some will only finance newer models. Compare the leading finance options for new or pre-owned boat motor.
Is there a difference between new or used boat motor loan?
There is a difference between securing loans for new versus used boat engine. New motors often get favourable financing rates from lenders, thanks in part to the security that comes with new warranties. When it comes to used motors, a key point of difference is the inspection process and accessed value. For private sales, an inspection is generally a prerequisite to obtaining a loan, as it assures the lender of the engine’s condition. In the case of dealer-sold engines, this step may be unnecessary, as dealers typically perform inspections before placing motors on the market, ensuring they meet certain standards.
In some cases with inboard motor financing, security of the hull and/or trailer of the vessel will be needed.
What impact does the motor age have on the loan?
Motor financing operates on the premise of a secured loan, with the motor itself serving as collateral. The amount that can be borrowed is contingent upon the appraised value of the engine, which factors in depreciation. Lenders typically have stringent guidelines regarding the age of the motor they are willing to finance, setting various age thresholds based on their risk assessment policies. While some specialised financiers may offer loans for boat motors over 20 years of age.
For older boat motors options do become limited. In such cases, borrowers may have to resort to accessing an unsecured personal loan.
What is the difference in rate between a used and new boat engine?
Interest rates are determined by the value of the transaction and the customer’s credit profile. This can range from lender to lender. With many specialist marine finance lenders, they typically add around a half percent (0.5%) to the rate that a new boat would receive.
Other traditional lenders that don’t specialise in marine finance, especially for boat motors may add a higher percentage. Their range can be anywhere from 1% to 2% plus. Higher rates are typically allocated to items over 5 years in age.
In general, the better your borrowing capacity and credit profile along with a well kept boat motor, the better the rate you will receive.
Is it easy to buy a boat motor privately with a loan?
If you have found a motor you are happy with, purchasing it shouldn’t be an issue if it’s in good working order and has a positive inspection. Thousands of inboard and outboard boat motors are privately bought each year with no issue.
For such transactions, lenders typically require an independent inspection to ensure the engine’s soundness. This not only protects your interests by preventing the purchase of a substandard motor but also assures the lender of the engine’s value.
If approval for a secure boat motor loan proves challenging, you still have the option of acquiring it through a personal loan, which is a viable alternative.
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Applying For Boat Motor Finance
What is the oldest boat motor a bank will finance?
Most big banks will only finance new or fairly new boat motors that still have a warranty attached to them. There are other specialist marine finance lenders that will finance motors over 20 years of age. Marinewise has a range of partners that may be able to assist with the purchase of older engines, especially those that traditional banks won’t touch.
Who provides the best boat motor loan interest rates?
Traditional banks and many other prefer new or close to new motors for finance. Specialist marine finance lenders provide more flexibility in terms of rate and motor age. In cases where a lender won’t approve a older motor, a personal loan may be the best option.
Marinewise works with experienced experts in the marine finance space and can help provide the best options to ensure the lowest rate and approval for older boat engines.
Other popular boat motor financing companies include: Yamaha Motor Finance, Mercury Finance, Honda Finance, Suzuki Finance
What is the longest term for a boat motor loan?
Boat motor loan terms are typically between 1 – 5 years. In certain instances if you need longer, refinancing the asset could be an option.
How long does it take to get approved for motor finance?
Approvals for a boat motor can be as quick as any other type of loan. If you have all the documents required by the lender ready to go for immediate assessment and approval. In certain circumstances borrowers can receive funding within 24 to 48 hours. However, inside a week is a more common time frame.
Quick funding is dependant on having all documents required by the lender ready to go for immediate assessment and approval.
Is it easy to get outboard motor financing for a used motor?
If you’ve found a outboard motor you like and it’s in good condition with a positive inspection, buying it should be straightforward. People often purchase used outboard’s privately without issues. Lenders usually require an independent inspection to ensure the engine’s quality, protecting your and the lenders interests. If securing a outboard motor loan is challenging, a personal loan is a viable and popular alternative.
What credit score do you need to finance an outboard motor in Australia?
If you want to apply for a boat motor loan in Australia, you’ll need a minimum credit score of 550. This is also subject to specialist lenders as many traditional banks will require a higher score.