We’re all likely familiar with finding financing for a car or home. Figuring out how to finance less ordinary purchases can be a bit tricky. Unless you’re in finance, you likely wouldn’t know where to turn to finance something like an airplane, a boat, a helicopter, or some other non-traditional purchase.
Sure, you can go to the bank for most things, but that isn’t always the case with every bank and certainly not for every purchase. That means you need to find customized lenders in that particular industry or financing options that don’t fit into one of the common categories.
Find Purchase Specific Lenders
You can find lenders for cars and homes all over the place. If there isn’t a lender nearby, you can always go to a bank. For more obtuse purchases, you often have to look elsewhere. The trouble is, taking out a personal loan to make a purchase like this is not ideal as the terms may not be as friendly.
In these cases, doing a little research and finding a lender that deals in the specific type of purchase you’re trying to make is much more feasible. For instance, if you’re looking to buy a boat or plane, then finding a lender or financing institution that caters to boats and planes is going to be your best choice.
Use Unconventional Loan Sources to Finance Your Purchase
What we’re talking about here is going outside of all typical lenders. In this case, you’re not looking to borrow from a financial institution, you’re finding an individual or group to finance your purchase for whatever reasons.
The trick with unconventional loan sources is making sure the terms are agreeable. Luckily, sources like peer-to-peer (P2P) financing or crowdsourcing usually have good repayment terms or are negotiable. You may think this type of financing is only for large business endeavors, but both can be used for a variety of purchases, assuming the parties involved agree to it. You may have seen people using crowdfunding apps for things like buying dinner or paying tuition. The availability of funding is there if you know where to look.
Use Assets to Finance Instead of Cash
This is typically called putting up collateral but if worse comes to worst, you can leverage something you own to purchase or finance something else. This can be done in a number of ways. Using the equity in your home to make a purchase is popular if a bit risky. Cashing in your retirement or borrowing against it is another option.
These options are of course closer to a last resort, but it’s something to consider if you’re desperate for a solution to make that purchase you’ve been looking forward to.
We hope these tips have given you some help in figuring out a way to finance your out-of-the-ordinary purchase.