They say that the best days of a person’s life are the day they buy a boat and the day they sell it. If you are in the former situation, then you are likely in the market for a flexible repayment boat loan that can give you the credit you need to get on the water. Before embarking on your quest for finance, you should trawl the waters of credit providers and know a bit about the process. (Image Credit: Peter H/Pixabay)
Financing a boat is no more difficult than finding credit for a new or used car. In many ways, the process is highly similar. The important thing to remember is to do some research before you begin your search for boat finance to ensure that you are not locked into an untenable debt situation. To get you started, you need to explore this quick guide towards boat finance.
Let’s look at some of the essential things to keep in mind when you are looking to finance a boat.
Know Your Credit Score
Get in touch with a national credit reporting service to find out your up-to-date credit score if you do not know already. Having this information in mind will give you an idea of what to expect before you approach prospective lenders for boat financing. You should also consider potential upgrades or repairs you will need to finance as well, like getting new boat seats, for example. If your credit is less than perfect, do not be surprised if financial institutions are hesitant to offer you the best possible rates.
However, if your credit score is reasonably high, you can often use this as a negotiating tool to bring down the rate you will be expected to pay.
Know The Details Of Your Prospective Boat
Having a boat that you want clearly in mind will help you narrow down precisely what financing you need from a credit provider. Look for a boat before searching for credit to avoid taking out too much or too little money in the form of debt. The last thing you want is to pay interest on the money you have borrowed that you do not truly need.
In many cases, credit providers will want to know what boat you are precisely planning to purchase. Having this information readily available will speed up the process of acquiring boat financing.
Consider Different Loan Types
It is important to be aware of different types of available financing to find a boat loan package that works for you and your budget. For example, you can often acquire a personal loan from your financial institution earmarked for a boat purchase, a home equity loan, or even credit from the dealer who may be selling you the boat.
As a last resort, you can also consider using a credit card to pay for your boat purchase. However, you will want to be confident in your ability to pay this debt back quickly as credit cards tend to have high-interest rates.
Different credit institutions might also offer slightly different loan options and rates. It is always best to explore your options with several different providers before settling on a final option.
Regardless of what type of loan you ultimately decide upon, be sure to know the details of your agreement. Be aware of the interest rate, the actual amount you have borrowed, your repayment period, and any extra fees or charges that will be applied to the price. Use an online boat loan calculator to get a general idea of what your monthly payments will be. This way, you will not be surprised when the first payment notice is delivered to you.
Save Up And Plan Wisely
Considering the above points before looking for boat financing will save you from grief after you purchase your boat. Use your best judgment and be sure that you understand what your loan requires from you each month. Best of all, save up some money to make a large down payment on your boat to save the most money in the long run.