Use your watercraft as collateral, but watch for high rates.
A boat title loan allows you to cash in on the value of your boat when you need money fast or have trouble qualifying for traditional financing. But like other title loans, they typically come with high rates — and you risk losing your boat if you default.
How do boat title loans work?
Boat title loans — also known as boat pawn loans — work by using the title of your boat as collateral for a short-term loan. You can continue to use your watercraft while paying it back.
Typically, you can borrow between $1,000 and $50,000, depending on how much your boat is worth. Most providers allow you to borrow a percentage of its resale value, which varies depending on the lender.
Some offer single-payment loans with a term of up to 30 days, while others offer installment loans with terms of up to 42 months.
How are boat title loans different from auto title loans?
While boat title loans and auto title loans work are similar, you’ll find a few key differences:
- Larger amounts. If your boat or yacht has a higher resale value than your car, you might be able to borrow more. But it’s often difficult to find a boat title loan of under $1,000.
- Longer terms. Larger loans tend to come with longer terms. Some boat title loans offer with terms of up to 42 months, while auto title loans tend to max out at 36 months.
- Might not be as fast. Getting your boat inspected can be more of a hassle than driving your car to the lender or inspection center — especially if your boat is moored farther away from your house.
- Less of a risk. While losing your boat is still losing an asset, you likely won’t risk losing your main means of transportation.
Find a title loan provider near you
How do I apply for a boat title loan?
Like other title loans, finding a boat title loan that’s entirely online is rare. While some lenders advertise online applications, you’ll likely need to have your boat inspected before you’re approved.
Though the application process varies by lender, expect to follow six general steps when applying for a boat title loan:
- Get an estimate of your boat’s value. Before researching lenders, narrow down a ballpark estimate of your boat’s resale value. You can fill out a quick form on sites like Boat Trader or NADA guides.
- Compare lenders. Pay attention to the lender’s location, loan amounts, rates, terms, and eligibility requirements. Many boat title loan providers don’t list much online, so you might need to call to learn what it offers.
- Start the application. Many lenders have a quick online application that asks for details like the model and age of your boat, as well as where it’s moored. Some ask you to upload photos of your boat — even if you still have to bring it in for inspection.
- Bring in your boat and your documents. After you complete the online application, your lender should get in touch with instructions for the inspection and the documents to take. You might need to haul your boat to an inspection center, though some lenders send an inspector to you.
- Review and sign your loan. Go over the rates, terms and conditions before signing off on your boat title loan.
- Drive away with your money. You can often get your funds as cash or a check when you apply in person.
The whole process can be as fast as 24 hours, especially if you have a boat that’s easy to transport. Once at the store, you might see your funds in as little as 30 minutes.
What do I need for a boat title loan?
Requirements vary by lender, though expect to provide your:
- Boat title. Title loan providers require a copy of a lien-free boat title in your name. You can’t use your boat if it’s collateral on another loan.
- Proof of income. Many lenders ask to see your recent pay stubs, bank statements or other proof of regular money coming in.
- Proof of residency. Some lenders might require you to live in the state you’re borrowing in. You might need to provide a recent utility bill, lease or mortgage agreement in your name.
- Boat key. A provider might ask for a copy of your boat’s key when you apply for a title loan, returning it after you’ve paid off the loan.
- DMV registration. In addition to your title, you might need a copy of your boat’s DMV registration when you apply.
- Government-issued ID. Most lenders ask to see a driver’s license or passport to verify your identity.
Is a boat title loan right for me?
It depends on your particular situation. A boat title loan is fast, doesn’t require good credit and doesn’t come with the risk of losing your car. However, title loans tend to come with APRs that soar well into the triple digits and the risk of losing a valuable personal asset. And because of the inspection, turnaround may not be as fast as other short-term financing options, like car title loans or payday loans.
A boat title loan can help you get the funds you need without putting your main form of getting around on the line. But it’s a high-cost loan that can take significant time and effort to process, even compared with other types of title loans.
Learn more about how these loans work and compare lenders in our guide to title loans.