What Is The Best Place To Get A Boat Loan
You have two options on how to search for a boat loan: in person at a boat dealership, or online.;
If you’re looking to buy a loan from another individual also called a private party purchase searching for an online boat loan is likely your best bet. Online lenders will often allow borrowers to purchase boats from either a private individual or through a dealership. It’s a more flexible option that may open the possibilities to include more affordable, used boats.;
Other Lenders We Considered
- US Bank: This lender’s loan interest rates weren’t the most competitive, starting at 5.24% for a new boat. The bank states that rates may be higher for private party boat purchases, loans under $25,000, and used boats. Ultimately, lower rates may be available elsewhere.
- USAA: USAA is only available to people with military affiliations, limiting the number of people who can access these loans. However, even those eligible could get a better rate from one of our top picks interest rates start at 5.25% with USAA, about a percentage point higher than a LightStream loan.
- Navy Federal Credit Union: Like USAA, membership with this credit union is only available to certain people. However, a starting interest rate of 5.95% for new boats and 7.45% for used boat loans mean there are better deals to be found elsewhere.
- Boat US: This online boat loan marketplace didn’t beat interest rates offered by other lenders. A high minimum loan amount of $25,000 also may be more than many borrowers need.
Shouldnt I Just Go With The Lowest Rate For My Boat Loan
A low rate on a boat loan is certainly seductive, but it is not the only factor to consider when securing financing. A Boat loan specialist can help you consider the big picture and factors that might affect your cost over the life of the loan, such as how long you intend to keep the Boat, what the terms are, and if there are any prepayment penalties. An experienced Boat loan Representative will make sure you dont miss the small print!
Also Check: How Do I Get Wifi On My Boat
Best Overall: Bank Of The West
;Bank of the West
Bank of the West is our top overall pick for a boat loan. The lender features low rates, flexible loan amounts, and widespread availability, making it a great choice for borrowers with good credit looking to purchase a boat.
Loans up to $5 million
Repayment terms between four and 20 years
Available in all 50 states
Full-time and liveaboard accepted
Fees can be rolled into loan
Rates as low as 3.59% APR
No cosigners allowed
Bank of the West is arguably one of the most popular watercraft lenders around. Founded in 1874, Bank of the West, also known as Essex Credit, operates and provides loans to creditworthy borrowers in all 50 states. Boat loans through Bank of the West can range from $10,000 all the way up to $5 million, with repayment terms from four to 20 years depending on the loan amount.
While the wide range of loan amounts and repayment terms is great, this lender wins our best overall spot because of the types of boats it accepts. Bank of the West offers to finance for boat model year 2001 or newer. Allowed boats include standard and custom power, sailboats, multi-hull boats, pontoon boats, electrical boats, high-performance boats, houseboats, and wood hull boats. One of Essexs few exceptions is boats that are capable of speeds of 99 mph or higher.
Other Alternatives To Boat Financing
If you really want a boat but choose not to finance your boat purchase, you still have other options, including rental, joining a boat club, or saving up on your own.
Boat Rental:;In many cases, a marina will offer boat rentals by the hour or by the day, allowing you to enjoy all the thrill of boat ownership with none of the long-term responsibility. There are also peer-to-peer rental groups like;Boatsetter, that offer an AirBnB flair to the process.;
Boat Club:;With little more than a membership fee and monthly dues, a boat club is a great way to have access to multiple types of boats anytime you want.
Save Up:;It may feel like you have a long way to go, but saving for the boat you want is a sure-fire way to ensure you dont end up underwater in a boat loan. To start, look at creating a;Sinking Fund, which will allow you to set aside money each month toward this goal while continuing to pay down debt or save toward other projects at the same time.;
Are you looking to buy a boat? Or do you want to start saving for that dream yacht?;Regardless of your goals, our team at Spero is here to help! We can help you in any number of ways. When youre ready, just let one of our member service representatives at any Spero branch know!;
You May Like: Do I Need To Register An Inflatable Boat
Online Boat Sales Team
Do you have additional questions? Maybe you are even;ready to apply? Let us introduce the NITRO Online Boat Sales Team. As part of White River Financial Services, the Online Boat Sales Team can help NITRO customers to easily apply for great finance options, and even shop for a NITRO boat at dealerships nearby. Theyre here to help at any stage of your shopping process!
Boat Financing: 5 Options You Need To Know About
Now that you’ve found the boat of your dreams, here are some ways to pay for it.
Boat financing can be a confusing topic, especially for first-time buyers. The options are much like those offered for a;car or RV, but still can be very confusing; what’s good for one person might not work for a different;financial situation. No matter what your bank account holds, understanding these five basic financing options;will help you make the right choice.
The bigger the boat, the bigger the financing challenges are likely to be. But even with yachts like this, you’ll have several options to choose from.
Read Also: What Battery Do I Need For My Boat
Working With Credit Challenged Customers Since 2002
SeaDream can assist those with less than-perfect-credit or credit challenges with flexible boat financing options. SeaDreams Bad Credit Boat Loans Department specializes in mid-tier credit score and sub-prime marine financing programs.
Our mid-tier programs will enable you to secure competitive financing even though you may not qualify for todays prime rate. SeaDream also offers sub-prime boat financing programs, which allows you to re-establish / rebuild your credit rating while enjoying the fun boating lifestyle.
With financing up to $100,000, SeaDreams mid-tier and sub prime boat financing programs offer you a variety of options to meet your needs.
Understand The Costs Of Owning A Boat
Boat loan down payments typically range from 10% to 30%, so make sure you have enough money saved up to cover the cost of the down payment before you apply for a loan. Once you own a boat, youll also have to cover maintenance and related costs. Some of the expenses youll need to cover as a boat owner include:
- Trailer to transport and store your boat: If you dont plan on storing your boat near the water, youll need a trailer to transport it from your home.
- Boat insurance: Boat insurance can protect you in the case of an accident or if anything happens to your boat.
- If you dock your boat at a marina, youll typically have to pay monthly fees for the privilege.
- Registration: Just like a car, many states require boat owners to register their boat. Costs vary widely from state to state.
- Winter storage: If you live in an area where weather conditions arent suitable for boating year-round, youll need to store your boat in the winter.
- Maintenance: Routine maintenance costs include painting, cleaning, and replacing small parts.
- Gas: If your boat is powered by gas, youll need to fill it up regularly.
Don’t Miss: What Is The Best Bowrider Boat To Buy
How Did We Choose The Best Boat Loans
Personal Finance Insider’s goal is to help smart people make the best decisions with their money. We combed through the fine print of many boat loans and lenders so that you don’t have to. We considered the factors that are the most important to boaters, including:;
- The type of boats financed: We searched for lenders that offered loans for the most shapes and sizes of boats, from houseboats to sport boats.;
- Interest rates:;We compared the starting points of interest rates from many banks, and compared ranges where available.
- Few or no fees: We looked for lenders that offered boat loans with the fewest amount of fees on each loan.;
- Loan amounts:;We chose lenders with the widest variety of loan amounts available to help everyone find a loan for their boat-buying budget.;
- Widespread availability: Lenders we considered have loans available in almost all 50 states, if not all.;
How Long Can You Finance A Boat For
Financing a boat in Canada can be an easy way to start into boating or upgrade to what you really want. Whether you are paying for a boat with cash , or you plan to borrow in one form or another,;boats hold their value very well. Because of that, banks with specific boat loan programs will have longer amortization for boat loans than personal loans, or loans for almost all other motorized equipment.
Here are some basic guidelines for boat loans:
All loans are O.A.C. .
New boats can have amortizations up to 20 Years. You can choose to have it less time, and yet this is typically the maximum if you qualify for it.
Used boats are often able to have amortizations up to 20 years – the age of the boat. For example, in 2019, a 2016 bowrider would likely have a maximum amortization of 17 years .
The rate you qualify for depends on your credit score, the age of the boat, the amount you are borrowing, the amount you are putting down in cash , and the current prime lending rate at the time of application at the bank you are applying to.
Applying for a boat loan means that they will, upon your approval, check your credit score and seek a pre-approval on a boat loan. This process is often referred to as a hard credit check. This can cause a very slight and temporary decrease in your credit score. We advise not having multiple credit approvals run at multiple boat dealerships within a short period of time.
Payments can usually be weekly, bi-weekly, or monthly
You May Like: How Much Does Dry Boat Storage Cost
Interest Rates Tend To Level Out
Unless youâre opting for a short loan term â five years or less â youâre going to get pretty much the same interest rate on your loan. When buyers find out an eight-year boat loan term is going to have the same interest rate as a 10- or 12-year loan term, they usually opt for the longer term.
Why? Because it gives buyers a lower monthly payment without adding to the total cost of their loan. This can make boat buying much more realistic for;buyers with a tighter budget, and it provides buyers the opportunity to make additional payments toward their principle. ;;
How To Finance A Boat Purchase
With warmer weather comes more time outdoors, and for those who have access to waterways, the desire to own a boat increases. But when it comes to buying a boat, what do you need to know? In this post, well explore all the aspects of boat loans and what it takes to sail home on your very own watercraft.
Recommended Reading: Where To Buy Boat Paint
Best Commercial Loan: Coastal Financial
Why We Chose It: Coastal Financial is our top choice for the best commercial boat loan because the company specializes in charter boat financing and will also take care of setting up charter management and boat insurance for you.
Offers boat insurance and charter management
No upfront rates
No published loan fees
You have to contact the company for borrower requirements
Coastal Financial offers a quick application process and fast funding. It finances new and used boats, charter boats, refinances, and RV purchases. It offers boat loans from $5,000 $5 million and approvals take less than 24 hours. You can apply online or over the phone.;
In addition to boat loans, Coastal Financial also offers U.S. Coast Guard documentation, boat insurance, and a boat charter management program. Coastal Financial offers commercial loans for yachts, fishing boats, catamarans, and sailboats. Youll need to contact the company for loan fees and specific loan requirements and terms as they are not available on the website.;
Once the borrower and vessel are approved for a charter loan, you put the boat in your companys LLC and you can enter it into a charter program. You can choose how often you want the boat chartered, and when you want to use it, and the company will handle the rest.;
Coastal Financial has mostly positive customer reviews with customers appreciating the marine industry knowledge, easy application process, and fast funding times.
The Boat Loan Payment Calculator’s Practical Example: Can I Afford A Boat Loan
As we are in the middle of an economic discussion about loans, let us answer the above question in the most economical way: “It depends”. It depends on many variables, your other debt liabilities, and overall consumption tendency.
The simple answer is the best. If you have enough disposable money per month to cover monthly payments, the answer is yes.
Let us show it on the example using the boat loan calculator.
Your monthly wage is $4,000. Your monthly outgoings include: $1,500 rent; $500 bills; $400 car loan; $300 food; $300 other fixed payments. So, your disposable money per month is:
$4,000 – = $1,000
Having $1,000 disposable money per month technically allows you to take a loan with monthly payment up to that sum. However, taking into account any potential risks of losing part of your income within the boat financing period, we would rather take a maximum of 30% of disposable money , leaving a safe liquidity buffer for unexpected expenses. If you input that value into our boat mortgage calculator’s monthly payment box, together with loan term and annual interest rate, the calculator will compute the loan amount you can take. In our example, for a 5% interest rate and 5 years boat loan term, it is $15,897.21. That should be enough to buy quite a decent boat!
Recommended Reading: Where Do I Get My Boat Licence
Whether Youll Need A Marine Survey
When you apply for a secured boat loan, the boats value will be a factor in how much you can borrow.
If youre not getting a new boat, you should get a marine survey. During a marine survey, an inspector will examine the vessel, engine and trailer, detail the boats condition, note any repairs needed and determine whether its safe to take on the water.
Boat Financing: How To Use The Boat Loan Calculator
Using this boat finance calculator is easier than you think, and you can do it at least in two different ways. Let’s assume you have already found your dream boat, and you wonder what would be the monthly cost of the boat loan. Here is what you need to do:
- You need to know the amount of loan, which you should enter into the first boat calculator’s field. Usually, it’s 100% of boat value, but sometimes you may decide to have a loan with your own contribution. Let’s assume you want to borrow $4000.
- Determine how many years you would like to repay your debt over and input it into the second box. How long are boat loans? Typically, it’s 1-5 years. Obviously, the longer period, the lower monthly payments are. On the other side, the total cost of the loan grows up in correlation with a longer period. In our example, we want a boat loan term of 5 years.
- The last thing to know is the interest rate you will be paying. In the boat finance calculator, you have a default value of 5%, based on the average cost for this type of financing. You can always change it by checking the interest rate proposed by your bank.
- That’s it! Our boat loan payment calculator will show you the result immediately. In our example, we get the monthly payment equal to $75.48. To see how much of the additional interest you need to pay, press the advanced mode button, placed directly under the boat calculator.
In the next section, we explain the second way of using this boat payment calculator. Keep reading!
Don’t Miss: How To Clean Mildew Off Boat Seats
Boat Loan Terms: How Long Can You Finance A Boat
Editorial Note: The content of this article is based on the authors opinions and recommendations alone. It may not have been previewed, commissioned or otherwise endorsed by any of our network partners.
Buying a boat? Before you gather your gear and take to the high seas, youll likely need to figure out how to afford your purchase. One of your key questions may be: How long can you finance a boat? Boat loan terms, unlike car loan terms, can stretch up to 20 years, nearly as long as a home mortgage. Whether you should borrow for that amount of time depends on several factors, including the cost of the boat, which can range from a new jon boat under $5,000 to million-dollar yachts. In general, the lowest interest rates are for the shortest loans, but your monthly payments would be higher.