Bluewater Loans

After making a decision to purchase a boat, the next step is to choose the best financial option available for you. There are various financial options available for you and it is important to choose one that best meets your needs. You can secure a loan to buy a boat through a home equity credit, personal loan, a conventional loan or credit card. This article will evaluate what you should consider when choosing a boat finance option, types of the options available, and merits and demerits of each one of them. The article will also look at the various loan terms available.

Types Of Boat Financing Options:

There are various kinds of financing options available for you. These are as follows:

  • Personal loans-You can buy your boat through a personal loan. When you use this path, it means that your boat will not be used as collateral against the loan. One of the downsides of personal loans is that they are very expensive because they are paid with a high amount of interest. Furthermore, Personal unsecured loans are offered with a fixed term rate.
  • Home equity loans- This is one of the best options of securing a loan to purchase your boat. The amount to be borrowed will depend on you loan-to-value (LTV) and the market value of your home. There are various advantages and disadvantage of this type of credit. In terms of demerits, the rates that are paid for this kind of credit are fixed which means that you can have a prior financial plan on how to pay your loan. When you compare it with the other kinds of credit options like credit cards, home equity loan are cheaper. Additionally the interest paid on this loan may be tax-deductible. In terms of negatives, there are initial fees and closing costs involved. Yet, if you default on the loan repayment, your house may be sold to recover the loan.
  • Boat loans-These are loans that are designed to buy boats. When applying for this loan, the lender will consider various factors as per the information that you provide them. They will look at your credit score, credit history, debt-to-income ratio and the value of your vessel. There are various advantages and disadvantages of boat loans. These are as follows:


  • Predictable monthly payment amount. This enables you to sufficiently plan ahead.
  • The loan duration is known
  • The boat can be used as collateral to secure a loan.


  • You may tie up your cash reserves
  • Interest rate may vary depending on the lender
  • Your boat may be repossessed and sold in case you fail to pay the loan.
  • Credit cards-This kind of credit to purchase your boat is expensive and should be used as a last resort.

Factors to consider when choosing a boat loan option

Many factors need to be taken into consideration when selecting the boat loan option. These are as follows:

  • Interest rate-It is important to consider how much you will use to buy your credit from a specific lender. To assist you get the best rate, it is important to conduct a background research. The research will assist you compare the rates of various lenders and choose the best one.
  • Loan terms-When buying a boat loan, it is advisable to select a fixed rate term. This is because the fixed interest rate enables you to plan ahead financially and repay your loan accordingly. You can predict and know how much you will pay every month till you clear your loan.
  • Down payment-The amount that you put down will determine whether to buy the loan or not. In most cases, the amount to be put down will depend on your credit score and credit history. It is important to repair your credit before applying for the loan.
  • Scores-Most lenders will offer their boat credit to clients whose FICO scores range from 700 to 800. It is important to generate your credit report from any one of the three bureaus, analyse it and see whether there are errors in their reporting. If you discover sections with errors in your report, write a dispute to the concerned bureau and ask them to delete or rectify the mistake.
  • Stability in employment-most lenders are comfortable offering their credit to people who are stable in their employment. It is important to offer them your employment history.

Call us at 1-800-USA-1965, or fill out our online application form.

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Call us at 1-800-USA-1965, or fill out our online application form.