Spring and summer are coming, and that’s an ideal time to invest in a boat and take advantage of the warm weather. However, purchasing a boat isn’t a simple process. A boat purchase takes time, money, and financing. So how hard is it to finance a boat? Not hard at all if you use the following information to find the financing that fits your needs.
How Do Boat Loans Work?
Boat loans work like most loans for large purchases: they require a down payment, and then you pay the rest of the purchase price off over time through monthly payments. Boat loans come with interest rates, so it’s best to review typical boat loan terms before you choose a loan. Most lenders offer three types of boat loans, each with different benefits and drawbacks:
Secured Loans
Secured personal loans provide the cash you need for your boat purchase, but are backed by collateral, like a savings account or a vehicle. These loans are easier to qualify for because lenders retain the right to keep your collateral if you fail to make payments.
Unsecured Loans
Unsecured loans don’t require collateral and are supported by the borrower’s credit. Lenders typically charge higher interest rates for unsecured loans because they aren’t tied to a specific asset.
Second Mortgage
Buyers who don’t want to take out personal loans can take out a second mortgage or a home equity loan. These loans tend to have lower interest rates, but are risky because your home serves as collateral.
How Long Can You Finance a Boat?
Some loans have terms as long as 20 years, but there are shorter payment periods out there. However, shorter loan terms come with higher interest rates, which lead to higher monthly payments. Boat financing interest rates range from 4% to 11% and depend on the type of boat you’re buying. You may find that longer-term loans provide more manageable monthly payments.
What To Consider Before Applying for Boat Financing
It’s important to consider all the important aspects of owning a boat before deciding to purchase one. These include:
Your Credit
Some lenders may offer a higher interest rate or require a down payment if you have a subprime credit score. Making sure you have a healthy credit score improves your boat financing terms.
The Total Cost of Ownership
The costs of owning a boat extend beyond the purchase price. Slip fees, towing, storage, fuel, insurance, and regular maintenance all factor into the total cost of owning a boat.
Marine Survey
A marine survey verifies that the boat you’re purchasing is in working condition, which is recommended when buying used. An inspector examines the craft and equipment for any faults and suggests any repairs.
How Hard Is It To Finance a Boat? It’s Easy with Finance Solution!
Balancing all the moving parts of boat financing is difficult for both the dealer and buyer. Finance Solution makes it easy by offering a simplified three-step process:
Step 1: Application
If you’re working with one of our dealership partners, they’ll provide the necessary paperwork. If not, then all you have to do is fill out our online loan calculator and send us the salesperson’s name and purchase agreement number.
Step 2: Approval
We bring your credit application to various banks and arrange the best rate and terms. Our approval process includes asking new dealers for a list of recent denials, so we can demonstrate the benefits of our negotiation skills.
Step 3: Contract
Once one of our options is accepted, we contact the dealer and start developing the contract. Our boat financing process works as quickly as you want it to; we’re able to get financing in as little as a few hours.
Finance Solution: A Leading Multi-Recreational Financing Company
The Finance Solution team has years of experience and knows how to streamline the financing process. This allows dealers to move more units and provide a better customer experience. We get results by negotiating the best rates and terms for your customers. Contact us today and see how our services drive growth.
