Boat Loans
The major difference between boat loans and car loans is that you can pay back your boat for a much longer time. You can choose to pay back your boat for seven, ten, or even fifteen years, unlike your average car payments. Because boat loans often have fairly low interest payments, it makes expensive boats much more affordable.
When you are buying a boat, be sure to budget for the other costs. You will need to pay marina fees, fuel prices, and insurance costs on your boat, as well as the monthly payments. This doesn’t make owning a boat prohibitive: it just makes it easier for you to plan carefully for your purchase.
You can finance your boat purchase in a number of ways. You can get a boat loan. You can choose to get a home equity loan. If you are employed, you can see if you can borrow against your 401k: in this case, your monthly payments get deducted directly from your paycheck. You can also get a personal line of credit to fund your boat purchase.
If your boat has a head and a galley (a bathroom and a kitchen), you might be eligible to get a tax discount. Be sure to research this possibility when you choose your boat.
Some banks have minimum prices that they will lend you for your boat. This will also depend on the year of your boat. This might mean that you have to splurge on a newer model or a larger boat, but it might also mean that you have to ask around (be sure to keep credit unions in mind) to find an institution that can meet your needs. Keep in mind that some banks will not finance all boat purchases: metal or fiberglass boats are the easiest to finance.
When you are buying your boat, particularly if you are buying a used boat, remember that you need to buy a quality boat. Although a boat might just look like it needs a new coat of paint, a fixer-upper will always end up costing you more in the long-term than you were expecting. A poorly maintained exterior often reflects a poorly maintained interior, and that can cause much mechanical and structural damage. Always have your boat looked over by an expert, regardless of if you are buying it new or used. This could save you hassle and money.
