Boat Loans and Financing

Whether you live by the ocean, lake or bay, a boat can transform those hot summer days into an aquatic adventure that the whole family can enjoy. However, boats are not a cheap investment, and many owners look to boat loans to foot the bill.

Whether you choose a personal loan or a special boat loan, financing can be a great way to make the boat of your dreams a reality. Our SimpleScore methodology is the easy way to identify which loan will work best for you, using industry rankings, expert analysis and customer reviews to provide 2020’s best lenders for a boat loan.

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    In this article

      The 6 best boat loans of 2020

      Boat loans at a glance

      LenderAPRLoan AmountTerm
      USAA Starting at 5.75% $5,000–$35,00012–180 months
      U.S. Bank Starting at 5.24% $5,000–$150,00012 months–20 years
      LightStream 4.79%–11.49% $5,000–$100,00024–84 months
      Good Sam 4.49%–8.39%$10,000–$2M+48–240 months
      Southeast Financial Starting at 4.49% $20,000–$4MUp to 15 years
      Wells Fargo 5.99%–24.49% $3,000–$100,00012–120 months

      Best for military members – USAA

      USAA won’t buy you a yacht, but it will give you up to $35,000 toward your new pleasure cruise.

      APR Range
      Starting at 5.75%
      Loan Amount
      $5K-$500K
      Term
      12–180 months
      SimpleScore
      3.8 / 5.0
      close
      SimpleScore USAA 3.8
      Rates N/A
      Loan Size 3
      Terms 3
      Support 5
      Fees 4

      USAA offers all different kinds of boat loans, but you have to be a member to enjoy the benefits. USAA’s military member benefits extend to your new boat, too, giving you up to $35,000 and 10 years to pay it back. Rates begin around 6%, a modest start to a modest loan, but USAA fails to provide the upfront transparency that you see with other lenders.

      Best same-day decision – US Bank

      U.S. Bank can get you on the water that much faster with no down payment needed and same-day decisions.

      APR Range
      Starting at 5.24%
      Loan Amount
      $5K-$150K
      Term
      12 months–20 years
      SimpleScore
      3.8 / 5.0
      close
      SimpleScore US Bank 3.8
      Rates N/A
      Loan Size 3
      Terms 5
      Support 4
      Fees 3

      With same-day approvals, U.S Bank gets things moving faster than other lenders with drawn-out approvals. Even though you can borrow up to $150,000, there’s no down payment needed, so you can borrow the full amount of the purchase and start boating that much sooner. If you’re a U.S. Bank customer, you can save even more with an extra discount of 0.50% off your APR. Just beware of prepayment penalties — you could lose an extra 1% off your loan if you close your account within one year.

      Best no-collateral loan – LightStream

       We love LightStream for its great transparency, its full rates and terms clearly outlined on the site with extra savings for autopay.

      APR Range
      4.79%–11.49%
      Loan Amount
      $5K-$100K
      Term
      24–84 months
      SimpleScore
      4.2 / 5.0
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      SimpleScore LightStream 4.2
      Rates 5
      Loan Size 3
      Terms 3
      Support 5
      Fees 5

      An easy, online application is made even better with next-day funding. LightStream delivers fixed-rate loans that can get you funding within 24 hours. While the rates and terms are about average, you can save a ton of money from the lack of fees and prepayment penalties. Auto-payments will give you an extra 0.50% off the cost of your loan, so you can save even more.

      LightStream Disclosure

      Disclaimer: Your loan terms, including APR, may differ based on loan purpose, amount, term length, and your credit profile. Excellent credit is required to qualify for lowest rates. Rate is quoted with AutoPay discount. AutoPay discount is only available prior to loan funding. Rates without AutoPay may be higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice.

      Payment example: Monthly payments for a $10,000 loan at 4.99% APR with a term of 3 years would result in 36 monthly payments of $299.66

      © 2020 Truist Financial Corporation. SunTrust, Truist, LightStream, the LightStream logo, and the SunTrust logo are service marks of Truist Financial Corporation. All other trademarks are the property of their respective owners. Lending services provided by Truist Bank.

      Best for easy-reference rates – Good Sam

      Good Sam stands ready for the big spender with specialized loans of up to $4 million for all of your luxury needs.

      APR Range
      4.49%–8.39%
      Loan Amount
      $10K-$5M
      Term
      48–240 months
      SimpleScore
      4.2 / 5.0
      close
      SimpleScore Good Sam 4.2
      Rates 5
      Loan Size 5
      Terms 5
      Support 3
      Fees 3

      Good Sam is a marine-specific lender specializing in boat loans with higher limits and more extended repayment periods. When you’re buying a boat model from 2000 or newer, Good Sam can offer you some seriously impressive funding for all of your maritime dreams. It is very straightforward about its loans, offering clear rates and terms for everything from fishing boats to luxury yachts. Sign up for Rate Watch, and Good Sam will contact you when rates fall in line with your budget.

      Best for deferred payments – Southeast Financial

      Summon your patience, because thanks to COVID-19, same-day approvals are temporarily suspended.

      APR Range
      Starting at 4.49%
      Loan Amount
      $20K-$4M
      Term
      Up to 15 years
      SimpleScore
      4.8 / 5.0
      close
      SimpleScore Southeast Financial 4.8
      Rates N/A
      Loan Size 5
      Terms 5
      Support 5
      Fees 4

      This credit union believes in the finer things in life, offering boat loans of up to $4 million and more. Southeast Financial is one of the best boat lenders in 2020, offering loans of all sizes with generous repayment options. In addition to offering some of the largest loans around, Southeast Financial also has the lowest rates on our list. This means that while you stand to save money on your loan, you could also be able to afford a better boat than you would with another lender.

      Best for existing customers – Wells Fargo

      Wells Fargo is a stable, reliable lender that will give you the funds you need to purchase your new boat, as long as you keep your dreams reasonable.

      t
      N/A
      f
      N/A
      SimpleScore
      3.8 / 5.0
      close
      SimpleScore Wells Fargo 3.8
      Rates 5
      Loan Size 3
      Terms 3
      Support 5
      Fees 3

      Wells Fargo doesn’t specialize in boat-specific loans, but its personal loan will do the trick instead.
      Wells Fargo doesn’t waste its time differentiating between loans. Instead, you can simply use a personal loan to support your new boat purchase. While you won’t see the larger loans that are available from other lenders, there is still plenty of financing available to buy something the whole family can enjoy.

      What is a boat loan?

      A boat loan is similar to other kinds of loans because it is money that you borrow and then repay in regular monthly intervals. The exact terms of your loan will vary from lender to lender, but most lenders will give you up to 10 or 15 years to make repayment in full. Your loan requirements will depend on the kind of loan that you need and whether you will be using a secured or unsecured loan. Your credit score and history will also determine your APR and repayment terms.

      How boat loans work

      When you want to take out a loan for a new or used boat, bank financing is not the only option you have. You could also benefit from working with an online lender, credit union or marine lending specialist, all financial specialists who can help you pay for your new purchase.

      There is also the choice of a secured loan versus an unsecured loan. Both are popular ways of financing a new boat, but they are completely different. A secured boat loan uses your new boat as collateral on the loan. This means that if you fail to repay your loan, the lender can take your boat as payment. If you choose an unsecured loan, you won’t have to bargain with your boat, but you will likely face higher rates from the lack of collateral and may need a better credit score to qualify. You should also consider a lender that offers loans for bad credit.

      Large loan amounts

      Buying a boat is significantly different than buying a car. It is not an everyday purchase but a large and very expensive investment that requires some pretty serious funds upfront. Boats don’t hold their value as well as other types of property, like your home, so it is important to know that you are not likely to get your money back if you decide to sell later.

      You will also face higher monthly payments than you would with other kinds of purchases. Boat loans are no small investment, and interest and fees will only make the payments increase that much further. Before you commit to a new boat loan that can last ten or twenty years, you should run the math to see what you can afford and what will work for you long-term.

      Refinancing

      The arrival of COVID-19 brought an entirely new demand to the U.S., driving a thriving new demand for all things marine-related with the rest of the world shut down. The lower interest rates present an incredible opportunity for stable boatowners to refinance their boat loan so they can become debt-free that much sooner. Boat refinancing has always been a popular solution for those who want to leverage low market rates. By refinancing your boat loan at a lower interest rate, you can save yourself tons of money that will help you eliminate your financial obligation sooner rather than later.

      Alternatives

      Boats are very expensive purchases, which is why many borrowers opt for secured and unsecured loans. If you don’t want to take out a loan or cannot be approved for one, there are still other ways to make your boating dreams a reality.

      There are many popular boating clubs and groups, such as Freedom Boat Club, that act as a timeshare system for boats. You buy in to own a boat with other people and share the use of the boat, much like a condo timeshare for vacation. Finally, you can always pay cash. While it may take some time to gather the funds necessary, you will also have the ability to buy your boat outright and can pocket the cash you otherwise would have paid in interest.

      Check Your Personal Loan Rates

      Answer a few questions to see which personal loans you pre-qualify for. It’s quick and easy, and it will not impact your credit score.

      Get Started

      with our trusted partners at Bankrate.com

      How to choose the best boat loan for you

      1. Calculate what you can afford. Just because you want a certain boat doesn’t mean that you can actually afford it. Before you begin shopping for a boat loan — or even a boat, for that matter — you should have a solid understanding of what you can afford. Take the time to calculate your monthly expenses so you know how much disposable income you can afford to put toward your boat.
      2. Consider additional expenses. Once you buy your boat, there will be even more expenses waiting. You will need to register and title your boat maintenance and repairs to keep things running the right way. There is also the cost of insurance, as well as your trailer and all of the insurance. Consider all of these expenses when calculating your monthly budget.
      3. Shop carefully. While you don’t want to commit to the very first loan you receive, you do want to take the time to thoroughly explore your options. There are many different types of loan structures and options, with some benefitting you more than others, depending on your exact situation.
      4. Read the fine print. While APR is an important factor of any loan, there are other things you should pay attention to before you choose a loan. If it’s an expensive boat loan, you are likely to want more time to pay off your loan. This is where it becomes critical to review loan terms, because these can vary significantly from lender to lender. It is also important to pay attention to fees and penalties that can eat into your loan and cost you far more than you actually received.

      Boat loan FAQs

      If you can afford it, it is always a good idea to make a down payment on a boat loan. You are likely to pay far less in interest and receive more favorable terms with a smaller loan, and a down payment can help the lender feel more secure in approving your loan.

      Boats bring endless entertainment value, but not all boats will hold their resale value as well as others. As a boat owner, you will be responsible for the regular repair and maintenance, in addition to your ongoing loan payments, so you should choose a boat that is both affordable and reasonable for your means.

      Boat Trader, Boats.com, and Bass Pro are all popular places to purchase a new boat, but there are many other places to shop for boats. If you know what kind of boat you want, you can search for local dealers in your area for that manufacturer.

      We welcome your feedback on this article and would love to hear about your experience with the boat loans we recommend. Contact us at inquiries@thesimpledollar.com with comments or questions.

      Methodology

      SimpleScore

      We’ve created the SimpleScore™ to help you objectively compare products and services here at The Simple Dollar.

      Our editorial team:

      • Identifies five factors to compare across each brand
      • Determines the rating criteria for each factor
      • Calculate an average of those five factor scores to get one SimpleScore™

      We break down each of these five factors and their rating criteria for our review of the best auto loan companies of 2020.

      Why do some brands have different SimpleScores™ on different pages?

      Some brands like Bank of America, Wells Fargo, and Chase have different SimpleScores™ because they offer more than one financial solution — like auto loans, home loans, personal loans and banking.

      For instance, in our Bank of America Mortgage Review, we give the company a 3.8 out 5 based on our five rating factors for mortgages. In our Bank of America Auto Loans Review, we give the company a 4.4 out of 5 based on our rating factors for auto loans. By tailoring our SimpleScore™ to each financial solution, we’re able to give you a more accurate view of their services and how they compare to competitors’ services.

      Minimum new car rate

      Companies that look out for new car buyers with lower rates receive higher scores from us.

      Minimum used car rate

      We also give higher ratings to companies that look out for used car buyers by offering lower rates.

      Maximum loan size

      Having enough money to cover your auto loan is important –– that’s why companies with higher maximum loan amount receive better scores from us.

      Customer satisfaction

      We use the J.D. Power 2019 Consumer Lending Satisfaction Study℠ to find out how customers rate their experience with each company. (If a company is not included in J.D. Power’s study, we skip this rating factor and average the remaining factor scores.)

      Fees

      Fees can add up very fast –– that’s why we give a higher score to companies who have fewer fees.

      Reviewed by

      • Courtney Mihocik
        Courtney Mihocik
        Editor

        Courtney Mihocik is an editor at The Simple Dollar who specializes in insurance, personal finance, and loans. Previously, she wrote and edited for Interest.com, PersonalLoans.org, Ballantyne Magazine, Thread Magazine, The Post, ACRN, The New Political, Columbus Alive and the Institute for International Journalism.