Types of boat financing options:
There are various kinds of financing options available for you. These are as follows:
- Personal loans-A personal loan is one of the options that you can apply when buying your boat. There are various perks of applying this option. To start with, you do not use your boat as collateral when you use a personal loan to buy the vessel. Secondly, the amount that you get is provided with a fixed rate meaning that you can plan ahead and repay your loan. The main con of this option is that you pay a lot of interest meaning that this form of credit is expensive.
- Home equity loans- In case you have a mortgage, you can use your house equity to buy a boat loan. The amount of credit offered depends on your loan-to-value (LTV) and the market value of your home. There are various pros and cons of this form of loan. To start with pros, the loan is offered in fixed rate which affords an opportunity to plan ahead on your loan repayment. This option is affordable when compared with other options like credit cards. In addition to this, the interest paid on this loan may be tax-deductible. This credit has got various disadvantages for example; there are initial fees and closing costs involved. Again, in case you default on the loan repayment, your house may be sold to recover the loan.
- Boat loans-Various lenders have loan products that are designed to cater for the needs of people who want to purchase boats. You apply for the credit and lenders will consider various factors before extending the credit to you. For instance, lenders will evaluate your credit scores, credit history and your ability to manage your credit. It is important to compare rates offered by various lenders before you choose one that offers the best.