Guide to Finding the Best Financing for a Boat | Top Boat Loans & Loan Rates

The most popular loans for big purchases are home loans and auto loans. It makes sense considering people need a place to live and a way to get around, especially when public transportation in their area is not excellent.

Another less common big purchase people seek financing for is boat purchases. Whereas finding information on mortgage and auto loans can be easy, finding info on boat loans can be a little more complicated.

This article on boat loans will serve as a useful guide for individuals seeking boat financing.

It will provide helpful information on financing a boat, advice on how to find the best boat loan rates, and information on whether you can access competitive boat loan rates through your boat dealers.

boat financing

Image Source: Loans for Boats

What Kind of Loan Should I Get for Financing a Boat?

If you decide to purchase a boat, one of the first questions you should ask yourself is what kind of loan you want to apply for. “Well, what else is there aside from boat loans?” you may ask.

Sure, loans for boats from financial institutions are definitely available, but there are alternative options for boat financing you may want to consider.

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Financing a Boat Using a Personal Loan

A personal loan is a form of unsecured credit. You can also get secured personal loans that are tied to a specific asset as collateral, but these are usually just deemed auto loans or mortgages.

In the case of a personal loan, lending is approved based on the creditworthiness of the applicant. The funds from a personal loan can be used for whatever the borrower desires. In this case, you can use a personal loan for boat financing.

Pros of Using a Personal Loan for Boat Financing

There are a few pros and cons to using a personal loan for boat financing. Typically, unsecured personal loans are term loans. Instead of a revolving loan that can be used and repaid regularly (such as a credit card), a term loan assumes you have been given all of the money to spend.

As a result, you are given a certain amount of monthly payments to make with a specified end date when the loan will be completely repaid plus interest (assuming you make all of your payments in full and on time).

This is one advantage to using personal loans as loans for boats. If your personal loan is equal to or more than the amount of money you need for boat financing, then you have a set schedule for paying back the loan.

If it surpasses the amount of money you need for the loan, you can use the remaining amount of money at your own discretion.

You also get approved for a personal loan faster than you typically do for other loans, such as mortgages or auto loans.

This means that if you are looking for loans for boats with the hopes of buying one in the near future, you can get all your ducks in a row relatively quickly and snag any good deals on boats you may have stumbled across.

A personal loan also carries less interest than a credit card. Deciding to put your boat financing on a credit card is a risky option considering interest rates on credit cards are high and interest rates on cash advances on credit cards are even higher. In this way, getting your new boat financing from a personal loan is preferred to getting it from a credit card.

Cons of Using a Personal Loan for Boat Financing

Just because your interest rate will be lower than using a credit card for boat financing does not mean it will be your lowest option, period. Using personal loans as loans for boats means you are using an unsecured form of credit to pay for your boat.

Secured loans, like boat loans or auto loans, typically come with lower interest rates since the lender has a right to the collateral asset to recoup his or her losses if you are unable to pay back the loan.

If you decided to do your new boat financing using a personal loan, you might have to deal with higher interest rates. That being said, a consumer may opt for personal loans instead of new boat loans because of the individual’s relationship with his or her current bank. If you have a good relationship with your existing financial institution, but it does not offer new boat financing, you may still be able to secure a competitive interest rate based on your history for a personal loan with that bank.

A positive relationship with their existing bank and the potential for a competitive rate are reasons why borrowers may opt for personal loans instead of new boat loans.

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Financing a Boat Using a Home Equity Loan or Line of Credit

For a number of people, the biggest asset they have is their home. If you have a lot of equity built up in your home (meaning you have paid off a large amount of your mortgage or own your home outright), you can take out a loan using the equity in your home as collateral and use that loan for boat financing.

This option is attractive for a variety of reasons. For starters, you will receive lower rates because you have your home as collateral, making this loan less risky for the lender.

This means that if you are unable to find attractive boat loan rates, you can use your home equity line of credit or loan for financing a boat instead.

The downside of using home equity lines of credit for new boat loans is that, depending on how much you borrow, you are putting your home in jeopardy by transferring debt to another asset that carries debt (if you still have a mortgage).

Make sure you are comfortable with the terms of the home equity loan or line of credit so that you do not put yourself in a precarious financial situation by financing a boat this way.

Avoid Credit Cards for Boat Financing Unless It Is as a Temporary Measure

Putting a large purchase, like a boat, on a credit card is a very bad idea. If you are cringing at boat loan rates, wait until you get a look at your credit card interest rate applied to a large purchase like a boat. Even if your boat stays afloat, you will wind up sinking in debt.

The only situation in which it is advised to (maybe) use a credit card for boat financing is if it is as a temporary measure.

If you come across a good boat deal that needs to be acted on now, and you know you can easily get a home equity loan or other loan with a more attractive interest rate (than that of credit cards) later on, then you can use your credit card to make the purchase and quickly pay it off with the other loan before interest starts accumulating.

Keep in mind, though, if your transaction for boat financing is done as a cash advance, you will be charged an even higher rate than a regular transaction on your card. Additionally, cash advances do not have the grace period typically given to regular credit card transactions. Interest starts accumulating immediately.

Getting Boat Loans Through Your Boat Dealer (Boat Financing Rates and Boat Loan Rates)

A convenient option for boat financing is going through your dealer. If your boat dealer offers boat loans and attractive boat financing rates, it is as simple as sorting out the boat financing terms with the person you are buying your boat from.

Boat dealers have much incentive to offer boat loans and the best boat loan rates as part of their business. It is inevitable that a significant portion of their clientele will require boat financing. Making their dealership a one-stop shop for both boats and decent boat loan rates expedites the purchasing process.

Additionally, many dealers have existing relationships with lending institutions and banks that offer boat loans.

Naturally, banks make money off of boat financing through the collected interest, so they are interested in selling credit products any way that they can. Establishing partnerships with boat dealers who can advertise their boat loan rates as part of their sales package is a beneficial arrangement.

What makes this arrangement mutually beneficial is that the boat dealer:

a) can close the sale faster by eliminating the time it takes for the potential buyer to go and explore different boat loan interest rates and the best boat loans on the market

b) may get a cut from the lender for any customers who use that company for boat financing

Important Factors to Consider Before Getting Boat Loans Through Boat Dealers

Keep in mind that while some boat dealers may have attractive boat loan interest rates, others may charge higher rates for the convenience of providing financing in store.

Your boat dealer may have a terrific deal on a boat – but a deal that is only available for a limited time. Perhaps the promotion is ending that day. You do not have time to see if you are approved for boat financing in that amount of time, and you are definitely not going to put such a large purchase on your credit card.

Your boat dealer may make a proposition to you. If you use the boat loan interest rates offered by its partner lending institution, he or she will put that promotional price on hold for you, pending approval from that financial institution. As a result, you get the deal on the initial price of the boat, but you may not be getting the best boat loan rates.

If you have a great credit score, though, you may be able to secure better boat financing terms, even through a dealer.

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How Can I Find the Best Boat Loans with the Best Financing Terms?

When it comes to securing any credit product with a low interest rate, your credit score is the biggest factor, and finding the best boat loans is no exception.

The boat loan rates you are eligible for will ultimately depend on your credit score, which is calculated based on your credit history and any outstanding debt.

For individuals with good credit scores who want to compare a bunch of boat loan rates, there are tools online specifically for finding boat financing.


BoatUS is a website that is bursting with information and resources for individuals who already own a boat or are looking to buy a boat. Of course, it has a decent portion of its site dedicated to individuals looking for boat financing and boat loan rates.

Its boat loans webpage offers plenty of information on the types of boats it can help people find boat financing for in addition to a boat loan rates calculator and an FAQ section.  

boat loan rates

Image Source: Boat Financing

BoatUS is able to help aspiring boat owners find boat financing for:

  • Used boats (as old as 1919)
  • Powerboats
  • Sailboats
  • Custom boats
  • High performance boats
  • Houseboats
  • Multi-hull boats
  • Pontoon boats
  • And electric boats

It also offers boat loans options ranging from $10,000 to $4,000,000.

Individuals interested in finding boat financing and comparing boat loan rates can fill out a free application, either paper or online, and gain access to experts who can help them navigate the process of financing a boat and finding the best financing terms.

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Boat Financing USA

Boat Financing USA is a website similar to BoatUS. You can apply to have the website find the boat financing that fits your needs. Individuals gain access to a dedicated specialist, quick approvals, a fast way to view the most competitive boat loan rates, and other helpful resources.

In addition to helping people find boat loans, Boat Financing USA also provides assistance in helping those with bad credit secure boat financing, so long as their credit score is higher than 550.

To qualify for the bad credit boat loans program, applicants must:

  • Be buying a boat that is a 2004 model or newer
  • Be searching for a loan amount for a minimum of $5,000
  • Be searching for a loan amount for a maximum of $60,000
  • Be able to include a minimum down payment of 10%
  • Have a minimum credit score of 550
  • Provide proof of income
  • Be purchasing a boat with a maximum length of 28 feet

Individuals interested in finding boat loans and boat financing through Boat Financing USA simply need to fill out an application on its website.

Consider Using a Boat Loan Rates Calculator to See the Estimated Monthly Payments of Your Boat Financing

Loan calculators are a tremendously useful tool for getting an estimate of how much you are poised to pay a month for any loans, including boat loans.

Consider using a boat loan rates calculator to see how much your monthly payments will be with specific boat financing terms you are considering. You can enter the loan amount, interest rate, and length of the loan to determine how much you will be shelling out and if that number works within your existing budget.

Whether you are buying a boat for business purposes, to fulfill a lifelong dream of boat ownership or because you want to travel in style, securing boat financing can definitely help lessen the financial impact of your purchase.

Compare boat loan rates and find the boat financing rates that can let you set sail in search of new (and affordable!) horizons.

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