How Long Can You Finance A Boat? Everything You Need To Know About Boat Loans

How Long Can You Finance A Boat?

Are you thinking of purchasing a boat to have some quiet time on the sea? Then you’ve got no worries since this useful article will walk you through the various ways and means you can finance a boat and have a good time with it on the sea.

There is a bit of flexibility in boat financing, especially when compared to car financing. In most cases, you can have a boat loan term stretched out over 120 months, that is 10 years. For short-term finance, it can be stretched to 50 months, that is 5 years.

Here is a comprehensive detail on the interest rates on boats for either 120 or 60 months of boat financing by Miller Marine;

Unless you’re opting for a short loan term – five years or less – you’re going to get pretty much the same interest rate on your loan. When buyers find out an eight-year boat loan term is going to have the same interest rate as a 10- or 12-year loan term, they usually opt for the longer term.

Why? Because it gives buyers a lower monthly payment without adding to the total cost of their loan. This can make boat buying much more realistic for buyers with a tighter budget, and it provides buyers the opportunity to make additional payments toward their principal. 

Financing a Boat – How Long Does it Take? When compared to other assets, boats have a much slower rate of depreciation. In terms of the trade-in and resale value, boat prices stay pretty consistent over time. That’s good news for boat owners who are hoping to get a decent payoff when they sell their current watercraft, and it’s good news for buyers who are looking at older models.

It’s worth mentioning that Bennington Pontoons hold onto their value exceptionally well. Not only are they built with high-quality materials and engineered for longevity, but they have a warranty that’s transferable to future owners.

Types of boat loans

Fixed-rate. Many boat buyers choose to lock in a rate and add predictability to their budget. “Fixed is by far the most popular and most widely used type of loan out there today,” Coburn said.

Adjustable-rate. If you feel confident that you can weather the fluctuations of interest rates over time, you may be able to nail down a competitive loan that offers a low introductory rate followed by one that adjusts according to interest rate indexes. There are also boat loans that include a lump sum “balloon” payment at the end. Just make sure you check the number of years your rate stays fixed before shifting to adjustable or, in the case of a balloon loan, that you can afford the payoff amount at the end of your term.

A few things to know when thinking of financing a boat;

  1. Simply getting approved for a loan and being able to make a down payment does not necessarily mean that you will be able to keep up with the obligation long term. Make sure you consult your budget and be realistic.
  2. When shopping for a loan, be sure to check your credit, pay down other debt and get prequalified so that you know the exact amount for which you’ll get approved.
  3. Don’t get in over your head. It’s tempting to buy a boat, but the better option is to make sure that you can afford the payments before giving into that temptation.

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