If you were shopping for a boat 30 years ago, you may have had a hard time finding financing for your boat. However, when you look for a boat today, you can easily find a lender who will help you get affordable terms for a boat loan. So how does boat financing work? Here’s what you need to know.
Who Will Provide Boat Financing?
To get started, you should have a basic idea of the institutions that provide boat financing. If you start with these organizations, you should be able to find affordable terms for your boat loan.
You may be surprised by how many banks offer financing for boats. Visit your local bank and see if they have any options for you. You can often find the information you need on their website, but it wouldn’t hurt to give them a call or even ask about boat financing options.
- CREDIT UNIONS
Many credit unions offer boat loans to their customers, so if you are a member of any credit union, be sure to check into their options. These organizations usually have the most attractive rates and may even have a marine-lending specialist on staff.
- FINANCIAL SERVICE COMPANIES
There are also financial service companies that offer lending on boat and marine products. These companies have broad access to many different lending institutions, so you may find more options.
You will also need to understand the various loan choices when you start to look for boat financing. Here are a few of the most common…
- FIXED-RATE LOAN
Similar to home loans, this is the simplest and the one used most often. The advantage of this loan type is that you have the same monthly payment throughout the life of the loan.
- VARIABLE RATE
Also called adjustable rate, these loans have interest rates that can fluctuate based on the specific indexes. They usually have a low rate for a locked-in period, then go up. They may also have a cap on how much it can rise.
- BALLOON PAYMENT
This loan requires borrowers to pay the entire balance at the end of a certain term. This can be beneficial if you will only own the boat for a short period, allowing you to prepare to pay off the loan.
The application process will vary depending on what institution you use, but in most cases you will need to bring specific information to the lending office. This information should include the price of the boat, income verification, personal finance statements, information on other debts, credit scores, and more.
When you sign the application, you will also give authorization for the lending company to check your credit independently.
Get Helpful Advice On Boat Financing
At Scout Boats, we are dedicated to service and quality. Contact our staff today and we’ll help you understand the details of boat financing for your new Scout Boat.