Boat Financing Guide 2023

bunch of ten dollar notes on top of each other. Explore YATCO's boat financing guide, get answers on financing a boat rates, terms, payments & more when buying a boat with a lender.

Boat financing is what you might require if purchasing a boat with the help of a lender. It is similar to other large ticket items you need a loan for, and as such, can be filled with plenty of questions – from boat financing rates and terms, to how payments work – we’re going to help answer these questions for you.

How to finance a boat

When it comes to financing a boat, you’ll have a few options to choose from. Depending on the dealer you are buying the boat from, you may be able to secure a loan through them. This has some advantages, similar to purchasing a car with a loan from the dealership. They usually have their own financial manager onsite, will have loans designed and built for boats and sometimes offer more competitive rates and terms than getting your loan from a bank. 

This may not always be the case, so it’s always a good idea to shop around to see what options are available to you before taking the plunge. A few items your lender may request in order to approve you are: 

  • Loan application 
  • Income proof – possibly through tax returns 
  • Financial statement 
  • Details on the boat you are purchasing 

How long can you finance a boat for?  

Most boat finance terms will be for a term of 10, 15 or 20 years. As boating has become more popular and their seaworthiness has become greater, lenders are open to more flexible terms. Once upon a time, it was harder to get a longer term boat loan since lenders weren’t convinced that they’d get their loan paid off before the boat had lost its value so they wouldn’t have any collateral should the owner default on the loan. 

How long can you finance a new boat?  

The terms for financing a new boat are similar to all boats – usually up to a maximum of 20 years. 

How long can you finance a used boat?  

Used financing rates and terms are similar to new boats, in that they are usually offered for a term of 10 – 20 years

Can you finance a boat for 30 years?  

It’s very uncommon to see boat financing terms of up to 30 years – most will have a maximum loan term of 20 years.

two business men shake hands, a third business man is using a calculator, business financing guide 2023

Is it hard to finance a boat?  

It’s never been easier to finance a boat. Most lenders have learned that boat owners are usually diligent on their loan repayments and with interest in boat ownership growing every day, it’s a great business model for them. Depending on your loan application and the year of the boat, it can sometimes be easier to secure a loan for boats less than five years old, but that doesn’t mean they do not offer loans to older models – you may just be able to secure better financing terms on newer boats. 

Who will finance a boat with bad credit?  

While it will be harder to finance a boat with bad credit, it’s not impossible. Many private lenders will offer loans to those with bad credit that were denied a loan from elsewhere. Depending on your credit score and the amount requested, private lenders may require collateral, or only be able to offer a higher interest rate than others

What credit score do you need to finance a boat? 

While every lender will have a different threshold, it’s generally accepted that most boat lenders will happily offer you a loan with a credit score of around 650.

Is it harder to finance a boat than a car? 

It can be a little harder to finance a boat than a car, and here’s why. Partially due to the sheer number of cars on the road and the need for automotive loans, and also due to the length of ownership. People tend to upgrade and grow out of their cars at a much quicker rate than boats, so car loans are usually for smaller terms, with lower interest rates and smaller amounts to borrow. As such, there are a number of competitive lenders available for your next car. Boat loans don’t have the same guarantee of resale value as a car – while they both depreciate, cars will always have a demand, while boats are more of a niche market.

sign of a bank on a stone wall

Boat Payments 

How to finance a liveaboard boat?  

It can sometimes be harder to finance a liveaboard boat since you don’t have the collateral that you would if you were securing a mortgage. Boats don’t maintain their resale value like a home so if you default on the boat loan payments, the bank will usually lose money. So, while it may be harder to secure financing for your liveaboard boat, it isn’t impossible. Like those with bad credit looking to finance a boat, you will usually be able to find the right lender to help bring your liveaboard dreams to life. 

For more information on what it’s like to live aboard full-time, please refer to this article.  

How to finance a yacht?  

Financing a yacht will be no different from financing a boat. Your loan request may be larger, but you will usually have similar terms and requirements. You may go through a regular bank, lenders who specialize in marine loans, or even go directly through your boat dealer and their finance department. 

Before you start the process, find out how much boat you can afford. 

Do boat dealers or yacht brokers offer financing?  

Boat dealers commonly offer financing for boat, while yacht brokers do not. Yacht brokers can, however, help refer you to some reputable lenders should you be on the lookout for quotes. Click here to find a trusted yacht broker near you for more information. 

Read this informative article to discover the key to selecting your ideal yacht broker.

What is the monthly payment of a $300,000 boat?  

The exact monthly payment on a $300,000 boat will depend on various factors: 

  1. How much down payment you made 
  2. Your credit score 
  3. The interest rate secured 
  4. Your loan repayment terms 

To give some perspective, let’s say you put 10% down on the boat, so you still owe $270,000. If we go for an average interest rate of 6.5% and a 20-year term, you will be looking at a monthly payment of around $2,000. 

What is the average boat finance term?

Most boat financing terms will be for around 10 – 20 years.  

Are boats worth the investment?

Boats are not typically assets that appreciate in value. More often than not (as in almost 100 percent of the time), you will lose money when you go to sell your boat – you will sell it for less than you paid. However, that doesn’t mean that boats are a “bad” investment. Boats give you freedom to explore the world around you, on your own terms. Boats create memories to last a lifetime for you and your guests. Boats can be the stress reliever you need to escape your day job or life stressors. Boats can actually give you the gift of time — time onboard with family and friends; time discovering untouched lands; time spent catching the biggest fish of your life; or time spent floating under the hot summer sun. 

So, while boats might not carry the best financial return on their investment, they do exceed expectations on memories made and experiences available.

luxury boats on a boat pier, business financing guide 2023

Boat Dock Financing & Boat Slip Financing 

Can you finance a boat dock?  

Yes, you can finance a boat dock. If the dock is at your house, you can usually wrap this up into your mortgage. 

How to finance a boat dock?  

Financing a boat dock will be similar to other items you need to borrow money for. Usually, you will apply for this loan under your mortgage, or as a home improvement loan. It will not usually be part of your boat loan. 

Can you finance a boat slip?  

You can finance a boat slip; however, this is certainly a less common request for lenders. Boat slips are usually much larger than a personal boat dock and are often used as an investment for buyers to then rent out space on the slip.  

How to finance a boat slip? 

Boat slip financing will be similar to other loans you are hoping to secure. You can shop around from various lenders to see the rates and terms they have available based on your credit history.

luxury boats anchored on a sandy part of the ocean

Boat Title 

What is a boat title loan?  

A boat title loan is where you put your boat up for collateral when you need cash for a short-term loan.

All this means if you default on your loan repayments, the bank or lender can take your boat as a means of payment. 

Can you get a title loan on a boat?

Yes, you can get a title loan on a boat provided the lender you are working with has this option available. 

Getting a boat loan doesn’t have to be a stressful experience. As the interest in boating and yachting grows, these boat loans become more commonplace across a number of lenders. We have a wide variety of other in-depth guides for boat lovers: learn about right of way rules on the water, or what it’s like boating in the superyacht capital of the world in Florida.

YATCO Boating and Fishing Guides 

Explore a full list of our detailed yacht and boat FAQ articles here. 

Search YATCO’s new boats for sale, used boats for sale, new yachts for sale, and used yachts for sale.  

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