How Long Can You Finance a Boat?

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How Long Can You Finance a Boat?

Although boat financing is no different from financing a vehicle, a house, or any other major purchase, many people wonder how long a boat can be financed. You will have to consider many factors, including the amount of your down payment and interest rate. This will also affect how much you pay each month.

These other factors should also be taken into consideration when you are deciding how long you should borrow the money.

Conditions for Boat Loans

Boat loans were historically granted for shorter terms than other major purchases. Because boats weren’t made as well 50 years ago as they are today, this is a fact. Many boats needed to be overhauled after a decade. Lenders wanted to ensure that their collateral didn’t lose value faster than what they were being paid. As boats and their engines have improved and become more durable, their resale value has increased. The net result? The net result? Lenders are willing to finance them for longer periods.

You may have heard that boat loan terms are very short. Although it was possible to get a boat loan for 10 years, those days are long gone.

Many lenders will finance boats for up to 20 years. This can reduce your monthly payments significantly. You can use our Boat Loan Calculator and see how monthly payments will differ between a 10-year term or a 20-year boat loan.

Factors that Influence Boat Financing Terms

However, you should be aware that the length of a loan can have an impact on other variables. A lender may want to increase the interest rate or a lower down payment if the loan term is doubled. A lender might also consider other factors when deciding how long a loan term to approve. These include:

  • The amount of the loan
  • Type of boat
  • If it has been used, the age of the boat

Boat loan size

The loan amount has a significant impact on the length of time a lender is willing to extend it. The loan amount will determine how long it can be financed. Lenders will often have minimum loan amounts that are applicable to specific terms.

Type of boat

Modern powerboats can all be grouped together. However, there are some exceptions that financiers will consider differently.

  • Boats with wooden hulls or high-performance boats, for instance, maybe treated differently.
  • There is a difference between powerboats and sailboats, but lenders may also distinguish between pontoon and multi-hull boats.
  • Liveaboards are a big problem that can arise from time to time. Liveaboard loans are not approved by all lenders because they are subject to the same laws as other boat loans.

Boat age

Lenders will accept a term length of up to three years depending on how old the boat is. The loan term for a boat loan will be longer in almost all cases if the boat is older than the boat. Some lenders place a limit on the age of a boat that can be used to obtain a loan. Others only deal with new boats.

You should also expect to have other loan requirements change when buying used. Some lenders may have higher minimum loan amounts or lower finance rates for boats built before a particular model year.

Are you ready to secure boat financing?

What’s the bottom line? The bottom line?

Our Boat Buyer’s guide will help you to understand all of the factors to consider when purchasing a boat of this type. You’ll enjoy many years of enjoyment on the water.


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