Pros And Cons Of New Boats
- New boats are likely to have the latest technology and design.
- You arent limited to the pre-owned market. You can buy the exact boat you want with the customizations that serve your needs.
- New boats are backed by a manufacturers warranty.
- New boats are less likely to encounter problems within the first few years of service.
- New boats are more expensive than used boats both to buy and insure.
- A new boat depreciates 5% to 10% in the first year.
- It can be more challenging to get a loan for a new boat, depending on your credit score.
- Not all new boats are winners. When you buy used, you can read customer and expert reviews of past models.
Applying For A Boat Loan
There are a few steps youll need to take in order to apply for a boat loan. These include:
- Whether youre interested in a sailboat, motorboat, or houseboat, what boat you want to purchase will influence what type of loan you need from a lender.
- Compare rates: When shopping for a loan, you should compare rates from multiple different lenders. This can help to ensure that you get the best deal possible.
- Review your credit score: Some lenders have minimum credit score requirements, while others reserve the most competitive rates for borrowers with excellent credit. Make sure your score is in a good place before applying.
- Make sure you have enough for a down payment: Typical down payments range from 10% to 30% of the total loan amount.
- Complete a loan application: To apply for a loan, youll need to provide information about yourself and the boat you want to buy, including your name, address, social security number.
Can I Get A Loan For A Used Boat
You can get a loan for a used boat, but there are some limitations. The lender usually requires that the boat be no older than a certain age, and most lenders wont finance a boat that was built before 2000 or 2001. However, some will finance boats of any age and price range, but you may end up paying a higher rate and making a larger down payment.
Different lenders have varying requirements when it comes to financing used boats. Some require an inspection and an appraisal while others will only finance up to 85% LTV and expect a down payment.
Financing a used boat is usually more affordable than financing a new boat, but its important to know the condition of the boat so you dont end up with unexpected repair costs.
Also Check: State Farm Auto Loan Rate
What Is A Good Interest Rate On A Used Boat Loan
While used boat loans can occasionally have rates higher than those offered for new boats, this isnt always the case. In fact, many lenders offer the same competitive rates whether youre buying used, new, or even refinancing. Because of this, applicants can expect to find used boat loans with rates in the 4% to 5% APR range.
For instance, Bank of the West our overall top pickoffers interest rates starting at 3.74% APR for watercraft over $50,000, whether the boat is new or used.
Are Boat Loans Secured Or Unsecured Loans
You can get a secured or unsecured loan to buy a boat. Unsecured personal loans often let you use the money for nearly any reason, including purchasing a boat. Since the loan is unsecured, it presents a slightly higher risk for the lender.
Because secured loans use collateral that can be repossessed by the lender, theyre considered to be less risky and may come with more favorable APRs or terms.
Don’t Miss: When Do You Repay Student Loan
Best For Bad Credit: Southeast Financial
For borrowers with bad credit, Southeast Financial is a good choice for a boat loan. This lender has no minimum credit score requirements, and loans are available even for borrowers with past bankruptcies.
No minimum credit score requirement
Discharged bankruptcies okay
Rates starting at 3.74% APR
Not available in Alaska or Hawaii
$20,000 minimum loan
High debt ratios may be a limiting factor
With a history dating back to 1936, Southeast Financial has been providing loans and other financial products to customers across the country for over 80 years. When it comes to boat loans, though, Southeast Financial excels at connecting borrowers with poor credit to lenders willing to finance their purchase.
Through Southeast Financial, subprime borrowers can access boat loans ranging from $20,000 up to $4 million, with no published credit score minimum. Borrowers with low credit scores or high debt ratios may not qualify for the best possible rates, but loans are available even to those with past bankruptcies.
New and used boat loans are not available in Alaska or Hawaii, and borrowers are only allowed to finance their purchase if the boat is intended for recreational useno full-timers or liveaboards allowed. Repayment terms may vary according to the loan amount but are available for up to 15 years.
Banks Are All Revved Up For Boat Rv Lending
Bank of the West in San Francisco will exit indirect auto lending and instead focus on financing purchases of boats and recreational vehicles.
The decision may seem counterintuitive, as auto-loan originations hit a near-record high of $159 billion in the third quarter, according to the Federal Reserve Bank of New York. Richard Fairbank, chairman and CEO of Capital One Financial, said on Oct. 24 that we continue to see a growth opportunity in indirect auto lending.
But the $91 billion-asset Bank of the West is hardly alone in opting to exit a business line that is seen as intensely competitive. Several regional banks, including TCF Financial in Detroit and Regions Financial in Birmingham, Ala., have decided to scale back or get out of indirect auto, citing shrinking returns and limited opportunities for cross-selling.
Bank of the West, a unit of Frances BNP, will stop making indirect car loans this month, Michael Pereira, the head of personal finance, said in an emailed statement.
He declined to say why it was leaving the business, but a company spokesperson told the trade publication Powersports Finance last week that Bank of the Wests personal finance team will refocus resources on its RV/marine loan business.
The shift is not without risks if the economy weakens, consumers are likely to curtail spending on big-ticket items such as powersports equipment and RVs.
A number of other regional and community banks are also becoming more bullish on marine and RV lending.
Benefits Of Recfis Boat Loan Program:
Financing for boats up to 30 years old
We work with self-employed borrowers who have a tough time proving income
Buy down to a 580-credit score*
Loans up to $200,000
Terms up to 180 Months**
Generous advances and back-end product allowance
Fixed contracts with no pre-payment penalties
Unparalleled customer service from seasoned professionals
*All loans are subject to credit approval and are not guaranteed approval at over a 580 score.
**Tier 3 and above.
Where Do You Go To Find A Boat Loan In Georgia
With over 1,800 miles of coastline, beautiful lakes, and sparkling rivers, Georgia has a lot to offer outdoor enthusiasts. On any given weekend, you can see countless boaters out on the calm waters of Lake Allatoona or enjoying the wondrous landscape of Lake Lanier. With so much to explore, you probably find yourself wanting, nay, needing a boat of your own. Luckily, getting a boat loan in Georgia is a great way to help you get started. But, where do you go to find a boat loan in Georgia?
Boat loans are widely available in Georgia. You just have to choose the best option for your needs!
Firstly, you have to find a boat! The best place to find your perfect boat is at your local dealership. They will have knowledgeable salespeople who can help you find the most that best fits your needs, whether its a fishing boat, center console, or even a pontoon. Another great place to find your perfect boat if you dont have a dealership nearby is on Boat Trader or BoatUS. Either of those will have thousands of listings from all over the country, making it easy for you to find the perfect boat at an affordable price. Specifically, BoatUS has various financing options for you once you find the vessel youre looking for.
Also Check: How To Loan In Bank
Down Payments For Boat Loans
Like with auto loans, you should be prepared to make a down payment .
You may be able to find an online lender offering boat loans with $0 down, but in general, offering a down payment affords you better monthly payments and sometimes even lower interest rates.
With your down payment at the ready, you can browse for the best boat loans and apply for a set loan amount and repayment term when youve found the best lender for you. Interest rates will vary and depend on the strength of your credit history.
Down Payment May Be Required
Boat loan lenders often want to see a down payment, generally between 10% and 20%, depending on factors including the lender and the cost of the boat. Some lenders offer 0%-down loans but keep in mind that making a down payment can hedge against the boats depreciation, or loss of value over time, and help prevent a situation where you owe more on your boat loan than the boat is worth. A down payment may also lower your monthly payment and reduce the total amount of interest you pay on the boat loan.
Also Check: Mission Fed Auto Loan Rates
What To Consider Before Getting A Boat Loan
Although there are a few choices for budget boats, most of them cost well into the thousands, and anyone in the market for a luxury boat can expect the price tag to be far higher than what most families have on hand for recreational expenses.
Once you have your sights set on the boat of your dreams and are ready to look at financing the purchase, take a moment to consider all factors that could affect your final decision.
Remember that the price tag is just one of the expenses attached to owning a boat. Maintenance and insurance can quickly turn into big-ticket items. And if you plan on keeping the boat at a marina, expect to pay monthly rent for a storage area, as well as administrative fees.
Anyone preparing to take out a loan should also take an honest look at their personal finances and future earnings. Once the contract is signed, the money must be paid back. Be sure to look closely at the fine print.
Is It Smart To Finance A Boat
Financing a boat could be the right choice if you have good credit, qualify for reasonable terms, and are confident you will be able to make the payments on time. However, if you have fair to bad credit, it may be smarter to work on your credit before making the purchase or pay cash if you are able to.
You May Like: What Is Fha Loan Program
Competitive Financing And Easy To Understand Terms For Boats And Watercraft
- We support all marine dealer purchases. Consider getting pre-approved before shopping for a boat so you know up front how much you can afford.
- We will use the boat you purchase as collateral. This means we will be on the boats title as the legal owner of the boat until you pay the loan in full.
- Our boat loan features competitive interest rates and loan terms to fit your budget.
Ready to start cruising behind the wheel of your favorite watercraft?
To apply, call or visit any of our branches. We will be happy to answer your questions and walk you through the quick and easy application process.
Auto financing available. Call your local branch for more information.
Visit or call your local branch to apply or request more information
Fallen In Love With A Boat Compared With Auto Loans Financing A Boat Can Be A Much Heftier Investment
Boats can be more expensive than a car, which means loan amounts can be higher and terms can be much longer.
Just how much you pay to finance a boat depends on a number of factors, including the type of boat loan you choose, the loan terms, your down payment and your credit.
Lets take a look at the different types of boat loans, your financing options and how to apply for a boat loan.
Read Also: How Do I Know If I Have An Fha Loan
How Boat Loans Affect Your Credit Score
Boat loans can have a positive impact on credit scores. As long as you make your payments on time and in full, you can expect your score to increase. Creditors like to see that borrowers can consistently make on-time payments. If you default on your boat loan, that will have a more negative impact on your score.
However, credit scores can be affected both positively and negatively by a boat loan. Applying for any kind of loan requires the lender to do a hard inquiry into your credit history. This does have a negative impact on your score, but the effect is minimal, and the inquiry falls off your report rather quickly. Just dont apply for multiple boat loans, as this will result in multiple hard inquiries and a greater impact to your score.
Late payments can bring credit scores down. If you are hoping to improve your score with a boat loan, it is important that you make all payments on time. If possible, set up automatic payments from a bank account that you keep well funded, that way you dont even have to worry about making monthly payments on time.
What Is The Average Boat Loan Interest Rate
The best personal loan interest rates range from 3 percent to 36 percent, with the average personal loan rate currently at 10.6 percent.
The average personal loan rate has steadily increased throughout 2022 due to rising federal rates. It is likely that these rates will continue to rise throughout the year. However, the actual rate you qualify for depends on the lender, your credit score and financial history, as well as the size of the loan.
You May Like: Bank Of America Rv Loans
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.
Is Financing A Boat A Bad Idea
As a general rule of thumb, you should ensure that any purchase you finance will be paid down faster than it depreciates. If the purchase’s value decreases at a faster rate than your loan balance, you run the risk of going “upside down” on the loan, or dealing with negative equity.
While this is most often talked about in terms of new cars, it’s also a concern with watercraft, especially since boats are quickly depreciating assets.
Negative equity can be a serious concern with a high-value investment such as a boat. If the boat were to be stolen, totaled, etc., you would be on the hook for the difference between the remaining loan balance and the insurance company’s valuation/payout. Negative equity can also come back to bite you if you ever want to trade in the boat or sell it, as you’ll wind up owing your lender out-of-pocket in order to finalize the transaction.
Lastly, it’s important to recognize that financing a purchase will cost you more than the sticker price, no matter how competitive the interest rate you obtain. Between loan processing fees and finance charges, the added expense can be significant.
While financing a boat is not a bad idea in and of itself, it’s important to strike a balance between your purchase price, down payment amount, and loan repayment terms. This will help maintain a healthy loan-to-value ratio and ensure that you don’t pay significantly more for your purchase over time than if you’d paid in cash.
Recommended Reading: What Is 30 Year Conventional Loan
Pay Cash For Your Boat
With an excellent credit score, stable income and a significant down payment, you may be able to secure a boat loan with favorable terms and super-low interest rates.
However, if you have enough money to purchase the boat outright, it makes sense to pay cash for your boat and avoid interest costs.
Doing so also lets you choose the types and amounts of boat insurance that fit your budget instead of whatever insurance you need to meet the demands of a lender.
How Does A Boat Equity Loan Work
February 29, 2016 by admin
A boat equity loan is a type of short-term secured cash loan that uses the title of your boat as the collateral. The loan amount is determined by the current market value and condition of your boat.
A major benefit of this loan type is that there is no credit check involved nor is a co-signer required. The lack of a credit check means is that there is no protracted approval process, and even if you have non-existent or substandard credit, you can qualify.
Additionally, you can maintain possession of your boat while paying off the loan. You provide your boat title, and you can keep the keys. Its a simple exchange, and as soon as you make your final loan payment, weÃ¢ll return your title to you.
If you decide to proceed with the process, the only requirements we have are that you be at least 18 years old, and you also need proof of employment or another regular income source. Furthermore, you will need to be prepared to show identification and references.
We are a nationwide company and we work with boat title lenders throughout the country. No matter your location, you can secure a boat equity loan with us.
Also Check: Is Banana Boat Sunscreen Gluten Free
Also Check: What Bank Has The Best Car Loan Rates