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Best Boat Loans

Shopping for a boat? Here are our picks for the top boat loan providers

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A boat loan is a loan used to purchase a new or preowned boat if you don’t have the cash to purchase the boat outright.

Boats vary in size, use, condition, and features, and the loans to finance them vary just as much. There are unsecured boat loans, secured boat loans, loans offered by banks and online lenders, and loans offered by marine lending specialists. There are also commercial boat loans which are ideal if you use your boat as a business such as a charter operation. 

The best boat loans offer competitive rates and terms, are available for a variety of boats, and are offered by reputable banks. We reviewed more than a dozen companies that offer boat loans before deciding on our top choices. Keep reading to see which boat loan is right for you.

Best Boat Loans of 2022

Best Overall : Essex Credit


Essex Credit

Essex Credit

Why We Picked It

Essex Credit is our choice for best overall boat loan because it offers multiple types of loans, including loans for borrowers who plan to use the boat for recreation or as a residence. It has a simple online application process and specializes in long-term loans from five to 20 years for borrowers with good credit, defined as a minimum FICO score of 700.

Loans have fixed rates starting at 4.74% (as of July 2022) and no prepayment penalties. However, there are loan processing fees that vary depending on the type of loan. Additional fees that you will incur when purchasing a boat include taxes, title, registration, and licensing fees. These can be rolled into the loan as long as your loan-to-value ratio (LTV) meets their guidelines. 

Essex performs a credit review within one to three business days of when you apply for a boat loan online, but funding times vary based on the vessel and loan type.

Essex Credit will not provide loans for boats manufactured after 2002 or for those that go over 99 mph.

Company Overview

Essex Credit is a division of Bank of the West and has been in business since 1981. In addition to new loans, the company offers refinancing options, as well as RV loans.

Although Essex has longevity in the business, it has mixed customer reviews with some customers appreciating the ease of the online applications while others reporting difficulties with getting in touch with customer service. 

Pros & Cons
Pros
  • Multiple types of boat loans

  • Long history in the marine industry

  • Live-aboard loans which not all lenders offer

Cons
  • Loans unavailable for boats manufactured before 2002

  • Some negative customer reviews

  • No short-term boat loans

Best for Bad Credit : Southeast Financial


Southeast Financial

 Southeast Financial

Why We Picked It

Southeast Financial is our top choice for boat loans for borrowers with bad credit because it has a low minimum FICO score requirement of 550, free credit consultation, and will even lend to borrowers who have filed for bankruptcy in the past if they are discharged.

Rates start at 5.49% (as of July 2022) and terms go up to 15 years. Loan applications are processed within 24 hours and funding generally takes three to five business days. The company doesn’t require a minimum boat loan amount and will typically finance boats up to $4 million. It offers loans for new and used boats for recreational purposes only; it does not offer live-aboard boat loans. 

Financing fees vary depending on the type of loan, type of vessel, and borrower qualifications.

Company Overview

Southeast Financial has been financing boats since the early 2000s, offers loans in all states, and specializes in funding subprime borrowers’ loans. In addition to boat loans, it offers RV loans, boat warranties, horse trailer loans, and motorcycle loans. Customers appreciate the responsive customer service teams, marine industry knowledge, and variety of loans.

Pros & Cons
Pros
  • Minimum 550 FICO score

  • Offers loans in all 50 states

  • Fast funding

Cons
  • No live-aboard vessel loans

  • Fees aren’t published

  • Doesn’t usually finance charter boats

Best Unsecured Loan : LightStream


LightStream

LightStream

Why We Picked It

We chose LightStream as our best unsecured boat loan because their loans require no collateral, they offer a Rate Beat program, and quick funding.

Borrowers with good credit can access a simple loan application, seamless loan process, and rapid funding. It offers same-day approvals and can even fund some loans the same day, although others will be funded in a few days. It offers new and used boat loans nationwide as well as boat refinancing. Loan amounts range from $25,000 to $100,00 and terms range from two and seven years. 

Rates start at 5.99% (as of October 2022) with an applied discount for autopay. There are no processing or prepayment fees and no appraisal fees. Their Rate Beat program offers a rate that is 0.10% lower than the rate offered for the same type of loan from a competitor. 

Some customers love the quick application and funding process and the loan knowledge of the agents but others complained about confusion on published rates versus actual rates.

LightStream also made our list of best debt consolidation loans, best motorcycle loans, and best RV loans.

Company Overview

LightStream is an online consumer lending division of SunTrust Bank, a part of Truist Bank. The company offers boat loans, banking products and services, home improvement loans, swimming pool loans, RV loans, and motorcycle loans. The company was founded in 2014 as a small startup company and has grown into an innovative online lending platform.

Pros & Cons
Pros
  • No collateral needed for a boat loan

  • Simple loan application

  • No loan processing fees

Cons
  • No terms over 7 years

  • Loans only go up to $100,000

  • Some negative customer service reviews

Best Marine Lending Specialist : Trident Funding


Trident Funding

 Trident Funding

Why We Picked It

Our choice for the best marine lending specialist is Trident Funding because they offer competitive rates, specialize in custom marine financing, and have been in business since 1996.

Trident has worked with over 40 banks and lenders so you can rate shop to offer the most competitive rates and terms which vary based on the type of vessel, down payment amount, loan type, and borrower qualifications. 

They offer fixed- and variable-rate loans and both short- and long-term boat loans up to 25 years. Typically, they approve loans within 48 hours and a down payment of 10 to 20% is standard. They finance new and used boats that are no older than 25 years and only used for recreational purposes. 

Trident Funding has positive customer service reviews and a solid industry reputation. Customers raved about the excellent service, timely responses, and marine industry knowledge.

Company Overview

Trident Funding was founded in 1996 by boat enthusiasts for boat enthusiasts with the goal of connecting borrowers to lenders so they can finance their passion. It is the U.S.’s largest independently owned boat and yacht loan origination company. Trident also finances RVs and provides marine resources and tips on its website. 

Pros & Cons
Pros
  • Boat industry knowledge

  • Educates first-time purchasers

  • Work with multiple banks

Cons
  • Don’t finance boats more than 25 years old

  • Don’t finance live-aboard vessels

  • You usually need a down payment

Best Commercial Loan : Coastal Financial


Coastal Financial

 Coastal Financial

Why We Picked It

Coastal Financial is our top pick for commercial boat loans because it offers a quick application process, fast funding, and finances new and used boats as well as charter boats. The company will also take care of setting up charter management and boat insurance on your behalf.

The lender offers boat loans from $5,000 to $5 million and approvals take less than 24 hours. You can apply online or over the phone.

Once the borrower and vessel are approved for a charter loan, you put the boat in your company’s LLC, and you can enter it into a charter program. You can choose how often you want the boat chartered, and when you want to use it, and the company will handle the rest. 

Coastal Financial has mostly positive customer reviews with customers appreciating the marine industry knowledge, easy application process, and fast funding times.

Company Overview

Coastal Financial, headquartered in Virginia Beach, Virginia, offers a quick application process and fast funding with some approvals taking less than 24 hours. The company finances new and used boats, as well as charter boats. Coastal also offers refinancing and RV loans.

It offers boat loans from $5,000 to $5 million and approvals take less than 24 hours. You can apply online or over the phone. 

In addition to boat loans, Coastal Financial also offers U.S. Coast Guard documentation, boat insurance, and a boat charter management program. The company offers commercial loans for yachts, fishing boats, catamarans, and sailboats. You’ll need to contact the company for loan fees and specific loan requirements and terms as they are not available on the website. 

Pros & Cons
Pros
  • Offers charter boat loans

  • Fast approval process

  • Offers boat insurance and charter management

Cons
  • No upfront rates

  • No published loan fees

  • You have to contact the company for borrower requirements

Final Verdict

All of the boat loans that made our list have different things to offer. Some only finance recreational boats and others finance live-aboard and charter boats. Loan terms vary greatly from two to 15 years with some lenders going up to 20 years. All the boat loans on our list are offered by reputable companies with years of marine industry experience. 


Although all of these loan providers have their strengths, our best overall choice is Essex Credit due to its multiple types of boat loans, competitive rates, and easy online loan application process.

*Rates as of July 2022

Questions & Answers

What Is a Boat Loan?

A boat loan is a specific type of loan that is used to finance the purchase of a boat. The loan can be used to finance a new or used boat and may include different types of watercraft such as jet boats, pontoon boats, sailboats, and even yachts. Rates and terms vary based on the lender, type of loan, type of boat, and borrower qualifications. 

There are different types of boat loans including unsecured and secured loans, loans from online lenders, bank loans, personal loans, commercial loans, and loans that come from marine lending specialists. Boat loans typically range from two to 25 years with longer terms of 10 to 20 years being the most common. 

Who Should Get a Boat Loan?

You should get a boat loan if:

  • You want to purchase your first boat but don’t have the cash
  • You want to upgrade and buy a new boat
  • You want to buy a used boat
  • You want to refinance your current boat
  • You want to purchase a yacht and use it for charters

A boat loan is usually not a good idea if you’re living paycheck to paycheck and aren’t sure you'll be able to make the payments on time. It’s also not a good idea if you’re not going to use your boat very often or if live somewhere with a short boating season. 

You want to make sure that the high associated costs of owning a boat and financing it are worth it before deciding to get a boat loan. 

Can I Get a Loan for a Used Boat?

You can get a loan for a used boat, but there are some limitations. The lender usually requires that the boat be no older than a certain age, and most lenders won’t finance a boat that was built before 2000 or 2001. However, some will finance boats of any age and price range, but you may end up paying a higher rate and making a larger down payment. 

Different lenders have varying requirements when it comes to financing used boats. Some require an inspection and an appraisal while others will only finance up to 85% LTV and expect a down payment. 

Financing a used boat is usually more affordable than financing a new boat, but it’s important to know the condition of the boat so you don’t end up with unexpected repair costs. 

How We Chose the Best Boat Loans

We researched more than a dozen boat loans before choosing the top six. We reviewed the boat loans based on the types of loans they offer, loan terms, borrower qualifications, total costs, and types of boats they finance. We also considered the company’s reputation and customer reviews. 

All of our choices had affordable rates, reasonable terms, and are available to a variety of buyers. They also offer financing for multiple types of boats and have good customer reviews.

Yachts moored in a harbor

shutterjack / Getty Images

Article Sources
  1. Essex Credit. "Boat Loan Rates."

  2. Southeast Financial. "Boat Loans & Financing."

  3. LightStream. "Boat Loans and Financing."

  4. Trident Funding. "Boat Loan Program."

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