Marine Finance

vandy

vandy

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Hi,
I know that to purchase boats or yauchts usually over £40k it may be possible to get marine finance. But, like so many businesses who offer finance on smaller purchases (i.e. laptop, TV, sofa etc.....) why there is no business in the UK to offer such thing on something like a brand new outboard engine say worth £10k?

Is it because there is no demand for it?

Don't you think if marine finance was available similiar to car finance even on small purchases, then the marine industry could in the UK could have been so much more active that it is now? :cool:

Any idea WHY there isn't such a thing?! of maybe it exists and I am not aware of!!!! :confused::confused::confused:
 
Couple of comments I can make.
TV/Sofa finance is really high volume stuff.
So the win some loose some aspect is worth it to the Lenders and the Retailers.
As against outboard sales.
Marine finance has never gone down the same road ( no pun intended) as the Motor Trade finance.
There are a number of problems whith regard to Financing boats in the same way that We are all used to with motor vehicles.
Which deserves a thread of it's own.
I too, agree there is a Market for the same ease of Finance ref Marine purchases of a significant value and a few years ago I did look into it.

There is not a 'system' in place you are not aware of to answer your question.
For the purchase of outboards etc.
Credit card, Personal loan and stuff like that is the only way right now I believe.
 
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vandy said:
Hi,
I know that to purchase boats or yauchts usually over £40k it may be possible to get marine finance. But, like so many businesses who offer finance on smaller purchases (i.e. laptop, TV, sofa etc.....) why there is no business in the UK to offer such thing on something like a brand new outboard engine say worth £10k?

Is it because there is no demand for it?

Don't you think if marine finance was available similiar to car finance even on small purchases, then the marine industry could in the UK could have been so much more active that it is now? :cool:

Any idea WHY there isn't such a thing?! of maybe it exists and I am not aware of!!!! :confused::confused::confused:
Click to expand...
I am not sure why you think banks would provide separate arrangements for small ticket marine items. Is it longer terms you are hoping for than a few years?
From the banks' point of view, they need security in some form or other. That might be your credit rating, or a claim on your home etc, but this all costs money to investigate,process etc. For small amounts, it just isnt cost effective. Remember that while an outboard might be of interest to you, its of no interest at all to the bank- its not even a very safe or secure asset, and from a finance point of view, I would imagine a bank would want to write it down over maybe three years.
And as Kawasaki suggests, there just isnt going to be the volume of transactions to make this a meaningful sprecialisation for the banks.
Essentially, you want to borrow some money; the fact it is for an outboard isnt really relevent, I would suggest. Add it to a house mortgage, maybe?
Oh, and the sofa thing.. I am pretty sure the instant credit facility is in the price of the sofa, as it is only through providing easy credit they can sell the sofas at all; no credit, no sales. Lots of people (hundreds of thousands of us) buy sofas. A few hundred might buy outboards.
 
I think it's something to do with.........................................You'd have to be off yer rocker to borrow money for a boat and you'd have to be even more off yer rocker to lend money on a boat. So hopefully theres not going to be many of either about.
 
On new engines Manufacturers (or importers) used to do Interest free credit. I know Yamaha and Suzuki have done this in the past, but only on Engines over £4500. Of course you also had to pay list price to get the deal.

These deals were often timed to a Boatshow and SIBS seemed to be the main one in recent years. I also know that certain importers of lower value boats (under £25k) used to do deals with Marine finance houses to get you an unsecured loan. I bought a Glastron 175SX in 2009 at Earls Court and it came Guaranteed low rate finance from Capital One. I put 20% down, they financed the rest over 5 years.

However getting any finance at the moment seems difficult, so the availability of deals is limited. I know major finance houses have pulled out of the Marine Market recently (Barclays, BoS) and they really only want to lend larger amounts as they now have reduced staff and less money to lend so easier to do it in larger tranches. If you try shopping around for a Marine mortgage the rates are rubbish unless you are borrowing over £100k (Comparable to a pre 2008).

As an aside I know that some manufactures of Inflatable dinghys and engines were still doing a deal on finance if you bought both. I am sure there were such deals on Quicksilver inflatables and mercury engine packages on purchases over £2500 last year. However this could have been just clearing old stock.

Also if looking at Marine finance, the offshore departments seem to have more money to lend than the UK subs. My current finance is with lombard IoM. Mind you I am not a UK resident.

Cheers

Paul
 
according to my knowledge you can only get financing facility only on engine not for the whole boat. may be there will be a company who offers that.
 
The big difference

is that outboards etc are lousy security.

Land / a house is brilliant - you can't easily relocate / damage it!

A car is ok - in this country they have to be registered and have robust identification so you can do HP type deals on them becuase as a lender you can "prove" that you own the car.

A boat is ok - If it's P1 registered you can get security by stopping it being sold and by having your debt written on the boats doc.

With an engine - how do you stop it being moved to anotehr country? how do you prove you own it - there isn;t really a national scheme like ships registration to allow the lender to say - "I'm interested in that"

Finally - as others have said - security om something less than £25k is too much trouble. Loans of that size are usually regulated by the consumer credit act, and the costs of actually repossessing something are high - all of that needs to come out of the equity on the item used as security for a engine purchased for £20k - even with £10 - £15k loan then the costs will probably outweigh the 2nd hand value of the engine.

Lenders "SHOULD" lend because the individual is a good risk - not because they have security so for most lenders the ywould finance the outboard through a straight personal loan.
 
Finance under 10k is pretty easy to come by, credit card, bank loans etc. Most finance on things like sofas is a rip off anyway, even if the apr looks good. No such thing as free lunch and all that.

Lombard do marine mortgages for much smaller amounts than 40k BTW.
 
I agree with you all that its all about risks etc.. But I personally feel the marine industry in the UK especially is known for "Rich" people!! Everything you want to buy is expensive within the marine context, even its a simple engine oil, because of the limited supply and demand.

Consumers WILL buy if they feel they can afford it, come on! who does not like to be on the water? I bet if there was a survey, over 80% of people would loved to own a boat, even a small one.

I am sure that no lender wants to start giving finance so it can bring a big change to the marine industry, at the same time I believe this situation will never change unless there is a source of finance for smaller purchases!

The old story of Chicken and Egg!!!
 
vandy said:
I bet if there was a survey, over 80% of people would loved to own a boat, even a small one.
Click to expand...
No, I dont think so. Most people I know cant understand the interest at all !
Some might wonder if its a modern day illness to afford only via finance; once upon a time you saved before hand.
No view either way, myself.
 
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