Your Boat Financing Guide

Most people don’t have tons of extra cash on hand to purchase a boat outright, which is why boat financing options exist. Before you use financing to purchase a boat, you’ll want to know what you’re getting into so that you’re prepared. Here are some of our tips on how to use financing to buy a boat.

Understand Your Finances

You will need to have at least 10% to 20% of the total cost of a boat available to use as a down payment, so it’s a good idea to go through your budget and determine how much you need to save up. You’ll also want to figure out how much you can comfortably afford to put towards a monthly loan payment. Don’t forget to factor in additional costs, such as maintenance, insurance, storage, and repairs.

One good step you can take is to check your credit score now and see if there’s anything you can do to raise it. You should aim to have a score that’s around 700, as this is considered to be good credit. If your score is under 550, this is poor credit and you’ll need to do what you can to raise it, by paying off debts.

Know About Loan Types

Typically, boat loans are either secured or unsecured. Secured loans make use of your boat as collateral, which means that the boat can be repossessed by the lender should you fail to pay your loans in a timely manner. Secured loans are harder to get, but have the advantages of offering higher borrowing amounts with lower interest rates.

Unsecured loans are easier to acquire and they don’t use your boat as collateral. However, you may still suffer from wage garnishment or have your debt go to a collection agency if you fail to make your payments. Unsecured loans also have higher interest rates and lower borrowing amounts.

Come see us at our dealership in Canandaigua, NY, to check out our full stock of new and used boats for sale. German Brothers Marina serves the cities of Rochester and Syracuse, NY.