Besides your house, a boat may be your most expensive purchase in your lifetime. There are a variety of costs involved when purchasing a boat including the down payment, monthly payment, boat insurance, storage, marina fees, fuel, maintenance, repairs, possibly a crew, and more. However, one of the biggest factors that affects the overall cost of the vessel is your boat loan interest rate. The difference between getting a ‘good’ rate and a ‘not so good’ rate can end up costing you tens of thousands of dollars or more, during the term of the loan. Keep reading so you can find out how to get the best boat loan rates and get out on the water already!

Best Boat Loans of 2022

Trident Funding offers boat loans, RV (recreational vehicle) loans, and aircraft loans. Imagine the possibilities! Take your mega yacht out to The Bahamas where you can relax in the sunshine, fish, and enjoy some water toys in the crystal clear waters. Then hop on your plane to go back home, take care of a business meeting, and pick up the family in an RV for a cross country adventure. 

But first, let’s delve into some boat loan details so your adventure can begin. Trident has been in business for almost thirty years and work with reputable, long-standing marine lenders. We can get you matched with boat loan rates that fit your budget and your lifestyle. 

We provide boat loans for new boats, used boats, and you can even refinance your current boat with Trident. We are able to offer competitive rates by leveraging relationships with banks across the US. This allows you to finance many different types of vessels including yachts, runabouts, deck boats, sailboats, and more. You can see your approximate boat loan rates online by using our boat loan calculator before you even apply. The boat loan calculator is a great indicator of affordability and knowing what to expect for your approximate monthly payment. 

Once you find out your budget and how much you want to spend, you can apply for a boat loan online, and we will guide you through the entire process from getting approved for a loan, getting you the best rate, to lining up U.S. Coast Guard documentation, insurance quotes, and settlement services. 

Boat Loan Interest Rates

Now that you know the importance of boat loan rates, let’s find out how the rate translates into what you’re actually paying for your boat. Rates vary based on the market conditions, the borrower’s financial information, and the boat itself. As of June 2022, expect a rate of 4.25% to about 6% if you have excellent credit, low debt-to-income ratio, and a strong overall financial profile, as well as a loan to value that is under 80 percent. If all of those things don’t line up, or your credit score is ‘good’ and not ‘excellent,’ you may still get approved for a boat loan, but expect your interest rate to be higher. 

Boat loan rates affect your monthly payments but they also affect the total cost of the loan. If you’re purchasing a boat for $100,000 and putting $20,000 down as a down payment, then your loan amount will be $80,000. Let’s say, you get approved for a fixed-rate loan at 6% and a loan term of 20 years, you will want to know the total cost of the loan. Keep in mind that this is assuming that you don’t refinance or sell the boat during this period. This loan will cost you $137,554.76. This doesn’t include the closing costs, loan fees, or any other associated costs. 

Now, let’s assume your credit wasn’t as strong, and your debt-to-income ratio was a bit higher but you still wanted to purchase the boat. The lender offers a boat loan with a 9% interest rate and this same boat will cost you $160,596.49 over the life of the loan. This is more than a $23,000 difference, which goes to show how important rates are. Keep in mind that these are just examples and you will want to do your own calculations, speak to your loan officer, and factor in all additional costs. 

How Boat Loan Rates are Determined

As we noted earlier, boat loan interest rates vary based on a number of factors including the borrower’s credit score, and financial information, as well as the sales price of the boat, its year, and the loan term. Additionally, boat loan interest rates fluctuate based on market conditions. Rates change with inflation, the supply and demand of money, and Treasury note yields. When Treasury yields are low, it affects long-term loans such as fixed-rate boat loans and home mortgages. Keep in mind that today’s rate may not be the same as tomorrow’s rate. 

To get a better idea of what your boat loan rate will be, input your information into the boat loan calculator. You can input your credit score range, the year of the boat, the type of loan, and the loan amount, into the loan calculator to get an estimated rate. For example, if you are purchasing a new boat, model year 2022, have a loan amount of $150,000 and have an excellent credit score, over 850, then your rate may be around 5.62%. 

Boat loan rates vary based on the following factors:

  • Market conditions including Treasury note yields
  • Borrower’s credit score
  • Borrower’s financial information including income and employment history 
  • Debt-to-income ratio
  • Loan-to-value
  • Year of the boat
  • Boat value
  • Loan amount
  • Loan term 

The Wrap Up 

Now you know the ins and outs of boat loan rates, how they’re calculated, and how to get the best possible rate, it’s time to apply for a boat loan. Check out the boat loan calculator to get an idea of how much boat you can afford to purchase. Apply for a boat loan with us and we will help you sail through the process of financing a boat. Remember to have all your financial information readily available to make the process as seamless as possible.