How to Finance a Boat

Financial Tip Friday | 01/28/22
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Buying a boat is a lot like buying a car. You’ll need to shop around, not only for the perfect boat for your desired aquatic experience, but the loan rate and terms that fit your life. A financial commitment as large as a boat—literally and monetarily—can’t be entered into lightly.

Whether you’re looking for a pontoon, a wakeboard, a bass boat, a cabin cruiser or a sailboat, here are a few tips on what to watch for as you look at financing your dream boat.

1. Finance or straight cash?

Perhaps you have the cash on hand to pay for that dream vessel. There are still reasons to finance, including the ability to build your credit while enjoying time on the water. In addition, financing all or a portion of the purchase can leave more liquid assets for upgrades or unforeseen repairs during ownership, or will allow the buyer to package things like warranties and service contracts into the purchase and pay on them during the life of the loan rather than all at one time.

2. Get an idea of how much you might be able to afford

Using the Ascend loan calculator tool is a great way to ballpark the amount of money you’ll need to make your boat dreams a reality. Knowing how much payment you can fit into your budget will help you determine the right boat (and the right boat loan) for you.

3. Be prepared to shop around for the loan that best fits your life

Want the best rate? The most flexible term? Hassle-free application processes? Want to avoid unforeseen fees if you try to pay off your loan early? Be prepared to shop around—unless you get an Ascend recreation loan, which has all that and more.

4. How much down payment can you afford?

This is a big one. The amount of money you put down will determine your monthly payment; many lenders want between 10% and 20% down payment, depending on the lender and the cost of the boat. Some will offer 0% down payments, but be careful—a down payment can hedge against the loss of depreciation over time. You don’t want to owe more on your boat than what it’s worth!

5. Get preapproval

You’ve done the research. You’ve found your lender. You know how much you can afford on a down payment, and how much you can afford per month. Now—get preapproved. You’ll be ahead of the game when you walk into the dealership armed with terms that often beat those a dealer could offer.

Got all of that? Great! Go get the boat of your dreams and we’ll see you on the water!

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