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The truth about lending


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My dilemma was to stretch my meager salary and purchase a Jet Ski. I live in Australia and summer was approaching, almost a must have item. I contacted several Finance Companies and received quotes of between 18-26%. I was quite young at the time and thought this was the going rate for marine loans. An application generally went like this. How old are you? Have you had a Boat Loan before? Do you own your own home? Do you have an adverse credit history (bad credit).

You can imagine how this was going, Young, First loan application and for marine finance also (marine finance/boat loans/Jet Ski Loans = Luxury Goods = Higher interest rates) and that bloody telephone company when I shifted house and could not post the old bill to me and listed a $300 debt on my credit file (CRAA). The finance broker was now talking 30% interest if he can even achieve an approval for that Jet Ski I so desperately wanted.

Why, you might ask does this always happen to me? Well if the truth be known it is actually not limited to you. The telephone companies, one in particular have been so rampant listing everyone that it has become a common occurrence to find small blemishes on younger clients credit files. Everyone has a first application for finance sooner or later. I don’t know of anyone that has bought their first home for cash. The truth is boat loans, Jets Ski loans and marine finance are categorised as luxury finance, this usually does attract a higher than normal interest rate, but what your current loan organiser/lending institution is not telling you is!

How do they get paid! You see they have what’s called a delivery rate, which is a rate the lender requires the funds to be loaned at so that they can make money. But how does the finance broker survive? Easy, the delivery rate the finance company supplies the funds to the finance broker at can be as low as 7%, what rate is your finance company supplying your boat loan/Jet Ski loan to you for? My guess would be, if you circumstances fit the above criteria, about 15-26% maybe more? Plus add to that a healthy application fee say $350-$500.The Finance broker is actually making money on the interest rate! and guess what? The small telco default that is listed on your file, well that company listed that many of them over the past years finance companies no longer take much notice of them.
I have written this article to inform the applicants on the pitfalls of boat loan/jet ski finance applications, what to expect when applying for finance and to raise the awareness of the public on asset finance lending. Expect a lower rate expect lower fees and you will be pleasantly surprised.
If your current finance broker is not performing, your calls are not being returned or he is unavailable please feel free to call Brokers ink finance, seven days a week, free call 1300 550 171 or

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