How to Finance a Boat

If you dream of sunny days spent captaining a boat of your own, you may also be wondering how to finance a boat. With more than 12 million registered boats in the U.S., you are not alone. Boat loans make it possible for many boat owners to purchase vessels they could not otherwise afford. What is a boat loan? A boat loan allows you to borrow money to finance a new or used boat. Those funds are typically paid back in monthly payments. How do boat loans work? Learning how to finance a boat is easy if you have ever financed a car because the process is similar. Some lenders require a down payment of between 10% to 20%. Certain lenders allow you to tack extras -- like life jackets and other safety gear -- onto the loan. The loan will either be secured or unsecured, although boat loans are usually secured. In a secured loan, the boat you finance acts as collateral. While the lender will generally offer a lower interest rate for a loan with collateral, they also have a legal right to reposse...