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MELBOURNE, AUSTRALIA, November 18, 2021 /24-7PressRelease/ -- When purchasing an asset, buyers can seek finance from various sources. According to leading finance broker, National Loans, many borrowers don't understand the various loan products and how they are assessed for eligibility. That's why National Loans have launched an online guide to help borrowers navigate a loan application and determine which type is right for them.
National Loans explains that many loan products are designed for a specific purpose. For example, motorbike finance is used to buy a motorbike, boat finance (also known as a boat loan) is used for boats and other marine craft while caravan finance is strictly used for motor homes.
On the other hand, personal loans can be used to fund almost anything the borrower wants like holidays, weddings, renovations and more. National Loans says that while personal loans are more flexible than asset finance, as the borrower can use the funds any way they want, it doesn't necessarily make them a better choice.
Loans can be secured or unsecured, though most asset loans are secured against the asset being purchased and most personal loans tend to be unsecured. A borrower's credit score increases their chances of the loan being approved and getting better terms.
While the exact terms of the loan will vary depending on the borrower's individual financial situation, National Loans says unsecured personal loans are generally considered riskier than a loan backed by collateral, like a boat or car and as a result, an asset loan will likely come with a lower rate.
As with all financing decisions, National Loans says determining which type of loan is most suitable comes down to an individual's financial situation and needs. It's a good idea to shop around and review all available loan options, paying particular attention to their interest rates, terms and fees.
For help deciding how to finance an asset purchase, speak with an expert finance broker like National Loans, as they can help borrowers search the market for the best deal.
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