Boat loans – Making it easy

When you look back on the last few years, the main topic you could have been hearing about in every media is the Global Economy Crisis. Even kids know that economy is in big problems and that the entire world is wrapped in this endless web of digits. Nevertheless, humans are positive beings and we have to believe in the better tomorrow. So, with that kind of attitude we still approach banks and collaborate with them, even in terms of just a strict intermediary object which provides us our salary or much needed help for enriching our wallet and life. Many people see banks, credits, loans and mortgages as necessary evil, but it doesn’t have to be that way. If you are pretty sure in the banking system and you want to ask for help for some unusual purchase like a boat, for instance, you’ll have to consider a few things. 

 What can you expect?

Some will say that buying a boat is crazy with the current state of the economy, but real pleasure and joy do not have a price. With your current credit record you can hardly be able to buy it by yourself, so it’s logical that you’ll ask for a loan. Even though you are approaching banks for certain financial help, it doesn’t mean that you’ll get what you wish for. Yes, every bank will be nice and polite with you, they’ll try to convince you that they are the best choice for you, but in reality it works the other way around. After you make your choice the real face will show off, and, to be honest, you will most likely not like what you see. The first thing that will make your stomach spin is tons of paperwork you’ll have to deal with. For instance, you’ll have to ensure every detail of your finances EVER. This means that the bank will check your entire credit history from your basic bank accounts and savings accounts, all the way to your previous loans and credits with your repayments efficiency. Other thing that will drive you crazy is the bank’s evaluator. Simply, the guy’s job is to find every detail that will help the bank not provide all the money that you asked for. That way they would not spend a lot of their resources, but they’ll still have you as their client and they will benefit from the interest rate. It’s all simple economy, minimal investment – maximal profit. Last, but definitely not the least, are the interest rates and repayment options. With such an unusual loan you have to expect much higher rates because, if you fail to repay all the money, the bank will have a tough time selling your item. 

What should you do?

 The easiest way to avoid all this unpleasant surprises is to be well prepared. How? Simple! Dig up all needed paperwork on time, even better, before even considering a boat loan in bank. Check them, look for possible errors and if you find them correct them as soon as possible. Also, check for eventual missed repayments that you’ve maybe forgotten about and settle them. After that, find your perfect boat and inspect it thoroughly. That way you’ll know in advance what could be the subject of your conflict with the evaluator and you’ll know how to beat him in his own game. When it comes to the interest rates on boat loans, there is not much that you can do. Most of the banks have their standards which they oblige and follow. But on the other hand, don’t feel ashamed to bargain! There is nothing you can lose, you can just get!

Be aware!

The thing that can harm you the most in the process is you repayment program. As you probably know there are two systems that are offered: Variable and Fixed rate. They both have their good sides and their bad sides, which one you’ll pick is up to you to decide. Main factors that will help influence your decision are questions: How much money do I need? How long do I want to be in debt for? Do I want to repay the same sum of money every month or not? Do I expect some bonus or big income that will help me repay my debts faster? Depending on your answers you’ll get the whole picture. If you are planning to pay off your loan for a longer period of time paying the same amount of money every time, your choice must be fixed rate. This way you’ll be able to plan and manage your funds in advance, while making sure that there will be no changes in your installment. If you are ready to take the risk of a different interest rate every month and get an option of having more loans during the repayment period you should most definitely take variable rate. This way you’ll have the chance of beating the banking system if the interest rates go on your hand and actually earn from your loan. In the same time there’s a risk of losing much more money the same way. One more hazard with variable rate is that many banks offer you additional loans during your repayment period so you can be dragged into a vicious circle of repayments.

Considering the price you can get in the end of the process, all the stuff you have to go through seems meaningless and minor. Be smart, be prepared, follow the instructions and enjoy the open sea!