Boat Down Payment Help: What Marine Lenders Expect

Why boats are financed differently

Marine lending is its own world. Boats depreciate on a different curve than cars, the resale market is thinner and more seasonal, and repossession is genuinely difficult. Lenders price all of that into the down payment.

Expect 10% to 20% on a typical recreational boat. Older hulls, larger vessels and liveaboards often require more.

What moves the number

Age of the hull. Many marine lenders will not finance a boat past a certain model year at all, and those that do want more down.

Loan term. Marine loans stretch long — 15 and 20 year terms are normal on larger boats. Long terms plus fast early depreciation is exactly the combination that makes lenders cautious.

Survey and condition. On used boats above a certain value, a marine survey is typically required. What it finds can change the financing.

Type of boat. A pontoon, a center console, a cruiser and a sailboat are not treated identically.

Costs that catch buyers out

The down payment is not the only cash requirement. Budget for the survey, sea trial, registration and titling, insurance (often required before closing), and either a slip or trailer and storage. Buyers frequently assemble exactly the down payment and then find another few thousand in closing costs waiting.

Closing a boat down payment gap

• Personal loan, confirming the marine lender accepts a borrowed down payment.
• Trade equity on a current boat, trailer or vehicle.
• Buying at the right time of year. Late-season and off-season pricing is real, and it lowers both price and required down payment.
• A different boat. Dropping one size class often changes the financing picture more than you would expect.
• Waiting a season and saving. Boats are discretionary. There is no penalty for buying next year at better terms.