Rates starting at a low 5% and terms as long as 20 years set boat loans apart from your typical personal loan. The best rates tend to go to expensive, new vessels — though you can still find a good deal if you have a credit score over 670 and can afford a down payment of at least 20%.
| Lender | Best for … | Starting APR | Terms | |
|---|---|---|---|---|
| Navy Federal Credit Union | Borrowing from a credit union | 1.79% | Up to 15 years | |
| LendingTree | Comparing lenders | Starting at 2.49% | Varies based on lender | |
| Essex Credit | Skipping a down payment | 4.29% to 7.69% | 4 to 20 years | |
| LightStream | Low starting rates | Varies | 2 to 12 years |
Boat loans work by offering you funding for a new watercraft that uses your vessel as collateral. It’s similar to a car loan: You can find a boat loan directly through a dealership or private lender.
If you finance through a lender, you can either have the funds sent to you or have the lender directly pay the dealership.
To qualify for the most competitive deal, you’ll need to meet the following criteria:
Sign up for autopay. Often lenders offer a 0.25% discount for signing up for automatic repayments.
How much you can borrow generally depends on the price of your boat. Typically, you can fund 90% to 100% of the value of your boat. Minimum loan amounts can start anywhere from $2,000 to $15,000, depending on the lender.
Like car loans and mortgages, boat loans often require a down payment. Generally, you’re required to cover at least 10% of the cost. But lenders tend to favor applicants that can front at least 20% of the boat’s cost. To avoid over-borrowing, we recommend saving up as much as you can for a down payment so you don’t need to borrow as much. The less you borrow, the less interest you’ll pay.
Remember: Boats are more like cars than houses. Once you make a purchase, your vessel will begin to depreciate. If you borrow a large amount with a lengthy term, you may end up paying more in the long run than it’s really worth.
You can get your money faster — without collateral and a down payment — by applying for an unsecured personal loan. Generally, you need good credit and an income over $24,000 a year to qualify.
These come with similar rates as boat loans, though loan amounts usually max out around $100,000 and terms don’t run longer than seven years.
Keep in mind that not every personal loan provider will allow you to use your funds to purchase a boat. Be clear when submitting your application that you intend on financing a boat to avoid a surprise rejection.
If you can’t qualify for a loan without collateral, consider backing it with another asset like your home by taking out a secured loan. Typically, secured loans have lower APRs than unsecured loans and easier-to-meet requirements.
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How we picked theseThe Finder Score crunches 6+ types of personal loans across 50+ lenders. It takes into account the product's interest rate, fees and features, as well as the type of loan eg investor, variable, fixed rate - this gives you a simple score out of 10.
Boats vary depending on the type. You can expect to pay anything from $25,000 for a new motorboat to well over $1 million for a new yacht. Used models can go for even less.
The boat itself is one of several costs that come with boat ownership. These include:
It depends on the type of loan you’re looking for, but in general, you may be able to find a boat loan from:
Comparing offers from lenders is the best way to find the best deal you can qualify for. Asking yourself the following questions as you shop around can help:
Making yourself a good candidate for lenders will go a long way in getting you low-cost financing for your big purchase.
While every lender will have its own unique application process, in most cases, you’ll need to provide the same information when applying for a boat loan.
Once you have financing, you can start to shop for a boat that suits your needs — just don’t let a salesperson talk you into buying more than you can afford.
It depends on the lender. Some might ask for a model and make, while others might allow you to apply for a ballpark amount, based on your budget. If you’re unsure, ask your lender what’s required ahead of time.
If you can’t find a boat loan near you — or would rather not use it as collateral, you might want to consider these alternatives:
Boat loans can help cover up to 100% of the cost of a new vessel and come in higher amounts and longer terms than your typical personal loan.
But if you need less than $100,000 and don’t want to use your boat as collateral, check out our guide to personal loans to find out if it’s the right choice for you.
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