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Finance

How do I get the Best Boat Loan?

By Eric Tallberg
Updated May 17, 2024
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Like any other loan, finding the best boat loan involves research, and comparison shopping. Just like car loans, recreational vehicle (RV) loans, and even home loans, boat loans are a matter of research, reading the fine print, and having a good credit score.

One of the first steps toward finding the best boat loan is to determine current interest rates for such loans. The Internet is, obviously, an invaluable asset when beginning the search for a loan. It’s fairly simple to examine various lending institutions online, to find out their interest rates for boat loans.

Some institutions require an application to get interest rate information, and some will post it on their website. Generally, the lowest interest rates on a boat loan will be quoted on the assumption that the applicant has nearly perfect credit. Good credit is essential to finding the best rate for the loan.

Fees are another thing to consider when shopping for a boat loan. Generally, these fees will be quoted up front by the lending agent. If not, chances are, this is not the best place to get a loan. Finding lenders offering reasonable fees and a low interest rate will certainly be a step in the right direction.

Next, determine the cost, as well as the value, of the boat. If applying for a pre-approved boat loan without a particular boat in mind, determine a price that you are comfortable with. It’s not worth the effort if the boat under consideration is unaffordable, either with, or without a loan.

The term of the loan, the length of time it will take to pay the loan is the next factor in the decision to apply. As a rule, the shorter the terms, the higher the monthly payments will be. However, the shorter the term of the loan, the quicker that equity, or worth, is built up in the boat when it is time to sell.

Most lending websites will have a finance calculator where the above information can be entered. Complete the information in the finance calculators from several lending sites, and then decide from the results of the calculations which lenders offer the best rates and terms. Apply to a number of them, and determine the best deal.

Be aware when applying for a boat loan –- or any other kind of loan –- that proof of income, or worth, will be required by the lender. This proof of income will usually be satisfied by presentation of pay stubs, income tax documents, and/or a bank statement indicating net worth.

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Discussion Comments

By bagley79 — On Jun 08, 2012

Do you get a better interest rate on a new boat than a used boat loan? When it comes to buying a car, it seems like the best interest rates offered are for the brand new cars. If you want to buy a used car, you have to pay a higher interest rate.

I was wondering if this was the same when it came to getting a loan for a boat. There are advantages to buying a new boat as you will probably have some kind of warranty on it and know you shouldn't have any repair bills for awhile.

The cost of a new boat is just a lot more than what you would find with a used boat. If I were to go out and buy a boat today, I would try to determine if paying a lower interest rate on a new boat would be better than getting a used boat with a higher interest rate.

By Mykol — On Jun 08, 2012

I think lenders are very cautious when it comes to boat loan financing. While something like a mortgage loan and a car loan are necessary, a boat loan is seen more as a luxury than a necessity.

I knew I wanted to buy a boat, but didn't have a specific boat in mind. I had a good idea of how much I wanted to spend, so I met with the bank to determine how much money I would be able to qualify for.

This made shopping for the boat a lot easier as long as I stayed below the amount I knew I would be able to get the loan for. If a seller knows you are a qualified buyer, they are also very willing to negotiate a price with you.

By myharley — On Jun 07, 2012

I think it is easier to apply for a boat loan than it is to sell a boat you can't afford any more. My son bought a boat a few years ago, and didn't realize how much money all of this would cost him.

Not only do you have to make payments on the loan, but also pay for a place to store it when you are not using it. The boat broke down a lot too, and there was money out for boat repairs. I think the boat was in the shop more often than it was on the water.

The first thing he did was refinance the boat loan for a lower rate, but the expenses were still too much for him. Now he has a boat that he has paid very little on, doesn't get used very often and he is having a hard time getting it sold.

By LisaLou — On Jun 07, 2012

When I was shopping around for the best boat loan rates, I found the best rate at my credit union. I ended up going through them to finance my boat and it was a pretty smooth process.

I still had to provide proof of income such as copies of pay stubs and income tax information, but it was not nearly as complicated as getting a loan for a house.

It wasn't nearly as much money as a mortgage loan so the requirements were not quite as strict. I always feel kind of uncomfortable giving out all of that personal information, but if you are applying for a loan, you know they can't loan you the money without that kind of documentation.

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