About
Your Trusted Partner in navigating the entire loan process for smooth sailing!
At Bristol Marine Finance, we understand the unique financial needs of the maritime community. With decades of experience, we specialize in providing tailored financial solutions that help our clients anchor their dreams of ownership, whether it is for family fun, fishing the high seas, retirement time or chartering in the Caribbean.
Meet Our Expert's
Essentials
The average interest rate for a boat loan can vary widely based on several factors, including the lender, your credit score, the loan amount, and the age and or type of the boat. Currently, as of the latest information available, the interest rates for boat loans are ranging from about 6.50% and up. Some lenders offer rate discounts for additional down payment, over 800 credit scores, etc.
The financing terms for a boat loan can range significantly, typically from five to twenty years. The exact term will depend primarily on the age of the boat and the loan amount. Smaller loan amounts may be limited to 12- or 15-year terms. It’s important to consider that while a longer loan term can lower your monthly payments, it also means you’ll pay more in interest over the life of the loan. Be sure to choose a term that aligns with your financial goals and budget.
The minimum down payment for a boat loan typically ranges between 10% and 20% of the boat’s purchase price. This percentage can vary based on several factors, including the lender’s policies, the cost of the boat, and the borrower’s creditworthiness. Typically, for loan amounts more than $200k, lenders require a minimum of 20% down payment.
For example:
- Boats priced under $150,000 might require a minimum of 10% down.
- More expensive boats, up to $200,000, could necessitate a 15% down payment.
- Larger boats and RVs will generally require a 20% down payment.
It’s also worth noting that making a larger down payment can be beneficial as it may reduce your monthly payments and help to offset the boat’s depreciation over time.
When applying for a Marine or RV loan, buyers typically need to provide the following items:
- Complete application and in most cases a Personal Financial Statement.
- Social Security number: To verify identity and credit history.
- Proof of income: Current pay stubs, last 2 years tax returns, or current bank statements to demonstrate financial stability. Self-employed borrowers may need some additional information, such as the last 2 years of business tax returns.
- Purchase agreement: Including make, model, year, and any relevant marine survey reports.
Once this information is received, we can generally provide a conditional approval from the lender within 48 hours or sometimes sooner. For larger, more complex applications it may take a few days longer for the approval process.
Most loan approvals (and rate locks) are good for between 30 and 60 days (about 2 months), depending on the lender.
The processing time for a boat loan application can vary depending on the lender and the complexity of your application and how quickly you provide the requested information. Generally, after your loan is conditionally approved, you will need to provide:
- For USED boats over 12 months old, you will need to provide a full survey, by a NAMS /SAMS certified surveyor, that includes a full sea trial and haul out.
- For NEW boats we will need copies of both the MSO (Manufacture’s statement of Origin) and the BC (Builders Certificate) These are the original title documents for new boats.
- For USED boats we will need a copy the current USCG certificate or registration
- If you are forming or have an LLC that is going to hold the boat as it’s single asset, we will need the full set of LLC documents including the Certificate or Articles of Formation, Certificate of Good Standing, EIN letter from the IRS and the Operating Agreement for the LLC.
- Copies of the borrower’s Driver’s License and in some cases a secondary form of ID.
- Any other documentation that the lender requests to clear all underwriting conditions.
Again, providing this information as quickly as possible will keep the process flowing smoothly toward the closing date.
Once all of these items have been cleared, the lender will provide a FINAL underwriting approval and we are now ready to move toward closing the loan with you.
We will need some additional information for a smooth closing process:
- Insurance binder or declarations page. Different lenders have different requirements for deductibles, etc. But generally, the ALL PERILS deductible cannot exceed 2% of the hull value of the boat and the NAMED STORM deductible cannot exceed 10% of the hull value. The lender will also want to ensure that their LOSS Payee clause is included on page.
- Verification of all deposits and the final deposit to the broker or seller
- USCG documentation most lenders will require USCG documentation on boats that are large enough to be USCG documented. This is generally any boat over about 27 or 28 feet in length. Part of the USCG documentation is the Ship’s mortgage, which is the lien on the boat for the lender. There are other acceptable “flags” to some lenders, as well.
There are many other “moving pieces” that are accomplished with the closing process. Keep in mind that in many cases, you will need to have some of the closing documents notarized.
