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Best boat loans of February 2024

Feb 23, 2024

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Personal loans

LightStream: BEST OVERALL BOAT LOAN

LightStream
Rating: 4.7 stars out of 5
4.7
Est. APR
7.99%–25.49%
* with AutoPay
Loan term
2-7 yrs
Loan amount
$5k– $100k
Min credit score
695
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Personal loans

Upgrade: BEST FOR BUYING A SAILBOAT

Upgrade
Rating: 4.7 stars out of 5
4.7
Est. APR
8.49%–35.99%
with AutoPay
Loan term
2-7 yrs
Loan amount
$1k– $50k
Min credit score
600
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Personal loans

Prosper: BEST FOR BUYING A DECK BOAT

Prosper
Rating: 4.7 stars out of 5
4.7
Est. APR
8.99%–35.99%
Loan term
2-5 yrs
Loan amount
$2k– $50k
Min credit score
600
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Check rate with Bankrate

Personal loans

SoFi: BEST FOR BUYING A LUXURY BOAT

SoFi
Rating: 4.7 stars out of 5
4.7
Est. APR
8.99%–29.49%
with all discounts
Loan term
2-7 yrs
Loan amount
$5k– $100k
Min credit score
680

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How to compare boat loan lenders

What makes a lender 'best' for one borrower will be different for another. However, there are a few factors that stand out as the most important when it comes to boat loans.

  • Usage requirements: Some lenders restrict what you can use the loan on. Read the terms and conditions thoroughly to make sure the lender allows you to use the loan for your intended boat-related expenses. 
  • Used boat restrictions: An older pre-owned boat may be viewed as a risk by a lender. If you're financing an older boat, don't be surprised if your lender requires a full inspection of the vessel to ensure it's in good condition before approving the loan. 
  • Member benefits: Banks, lenders and credit unions may offer benefits to existing members that marine-specific lenders lack. Some potential perks include interest rate discounts, extended grace periods or payment relief options. Plus, the application process will likely be streamlined with a financial institution that already has your information.  
  • Rates and terms: Your credit profile largely determines the annual percentage rate (APR) you'll be offered. Prequalify for at least three lenders to get an idea of what a competitive interest rate could look like for you. Also consider the repayment terms from each lender and what your payment needs are to make sure the loan won't hurt your finances down the road.
  • Fees: Carefully read the terms and conditions to see what fees each lender you're considering charges. Some waive every fee while others charge administration, prepayment and origination fees, to name a few. These can add up quickly, so make sure to search every fee charged and consider how it could impact your balance.

Bankrate's top picks for boat loan lenders

LENDER BEST FOR EST. APR LOAN AMOUNT LOAN TERM MIN CREDIT SCORE
LightStream Overall 7.49%-25.49% with Autopay $5,000-$100,000 2 - 7 years 695
Upgrade Buying a sailboat 8.49%-35.99% $1,000-$50,000 2 - 7 years 600
Prosper Buying a deck boat 8.99%-35.99% $2,000-$50,000 2 - 5 years 560
SoFi Buying a luxury boat 8.99%-29.49% $5,000-$100,000 2 - 7 years 680

A closer look at our top boat loan lenders

Here's a deep-dive into each lender, why it is the best in each category and specifically who would benefit most from borrowing from the lender.

LightStream: Best overall boat loan

LightStream
Rating: 4.7 stars out of 5
4.7

Overview: LightStream is one of the most competitive online lenders in the personal loan space, offering a quick application process, fast funding and low APRs. LightStream is owned by Truist Bank.

Est. APR
7.99%–25.49%
Loan amount
$5k– $100k
Min credit score
695

Upgrade: Best for buying a sailboat

Upgrade
Rating: 4.7 stars out of 5
4.7

Overview: Personal loans from Upgrade come with the benefit of competitive, fixed rates, a simple application, quick funding process and flexible borrowing amounts. These loans can be used to refinance credit cards, consolidate debt, take on home improvement projects or finance major purchases.

Est. APR
8.49%–35.99%
Loan amount
$1k– $50k
Min credit score
600

Prosper: Best for buying a deck boat

Prosper
Rating: 4.7 stars out of 5
4.7

Overview: Prosper is a personal loan pioneer — the company became the first firm to enter the peer-to-peer lending arena when it launched in 2005. Prosper offers unsecured personal loans through WebBank to customers with a variety of credit profiles. It also offers home equity lines of credit (HELOCs).

Est. APR
8.99%–35.99%
Loan amount
$2k– $50k
Min credit score
600

SoFi: Best for buying a luxury boat

SoFi
Rating: 4.7 stars out of 5
4.7

Overview: A SoFi personal loan is a good choice for borrowers who have a stable income and good-to-excellent credit. Along with a fully digital experience, SoFi has large loans and accepts joint applications. 

Est. APR
8.99%–29.49%
Loan amount
$5k– $100k
Min credit score
680

How we made our picks for best boat loans

To select the best personal loans, Bankrate’s team of experts evaluated over 30 lenders. Each lender was ranked using a meticulous 20-point system, focusing on four main categories:

  • Checkmark
    Affordability
    The interest rates, penalties and fees are measured in this section of the score. Lower rates and fees and fewer potential penalties result in a higher score. We also give bonus points to lenders offering rate discounts, grace periods and that allow borrowers to change their due date. 
  • Checkmark
    Availability
    Minimum loan amounts, number of repayment terms, eligibility requirements, ability to apply using a co-borrower or co-signer and loan turnaround time are considered in this category.
  • Checkmark
    Customer experience
    This category covers customer service hours, if online applications are available, online account access and mobile apps.
  • Checkmark
    Transparency
    For this factor, we consider how well information is presented to the borrower on the lender’s website. This includes listing credit requirements, rates and fees, in addition to offering prequalification.
Clock Wait
47
years in business
Credit Card Search
30+
lenders reviewed
Loan
20
loan features weighed
Rates
665
data points collected

What to know about boat loans

Boat loans can be used to finance watercrafts that range from an old used sailboat to a luxury craft. Before you apply for a boat loan, consider what type will work best for your needs along with the benefits and drawbacks of using financing.

​​What is a boat loan?

A boat loan can be similar to an auto loan. In this case, a boat loan gives you the money to purchase a boat. Some lenders offer loans specifically for boats, but most will offer personal loans that can be used to finance boats and related costs. Looking for an online boat loan from a personal loan lender can give you more options to find the least expensive option for you. 

Most lenders will ask the borrower to fill out a loan application, which can be fairly thorough. Lenders will also likely ask for information like tax returns and proof of assets. It's likely that you'll need to provide a detailed account of your personal finances during the application process.

The application process is typically fast and approval is largely based on your credit score and income. Though some banks require a down payment for the purchase of a boat, you may be able to finance 100 percent of the cost.

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How boat loans work

Find out how boat loans work and what you need to qualify for one.

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Types of boat loans

A secured loan is backed by collateral — property, a vehicle or a valuable item that's used to recoup the loan value if the loan payments aren't made. In the case of a secured boat loan, the boat itself could serve as collateral.
Due to the collateral, secured loans usually feature lower interest rates than unsecured loans, and may be accessible to borrowers with a low credit score or thin credit history.

Pros and cons of getting a boat loan

Green circle with a checkmark inside

Pros

  • Depending on the financial institution, you may be able to purchase a boat without making a down payment.
  • Terms of up to 20 years may be available if you go through a marine finance company.
  • Opting for an unsecured loan will allow you to have the boat title in hand as soon as you purchase it.
Red circle with an X inside

Cons

  • Origination and administrative fees have the potential to cut into a large portion of your loan amount.
  • Taking out a larger loan could boost your debt-to-income ratio significantly, which makes it harder to get approved for other forms of financing.

Is a boat loan a good idea?


Nationally recognized student financial aid expert

If a boat is a luxury, as opposed to a necessity, buying a boat with a boat loan may not be a good idea. You may have trouble making the loan payments. The value of the boat will depreciate over time. There will also be ongoing costs involved in keeping the boat even if you don’t use it, such as insurance, maintenance and storage. You may be better off renting a boat if you don’t use the boat very frequently.

Senior Loans Writer

Committing to a boat loan makes sense if you’re more than just a once or twice-a-year weekend water warrior, and don’t have the cash to buy one outright. Like any recreational purchase, make sure you budget for the initial and ongoing costs. You’ll need some way to get the boat to the water, a place to store it and will spend money to maintain it before, during and after your local boating season. Pick the shortest term you can afford so you can enjoy payment-free boat ownership sooner rather than later. If you have a tough time finding a secured loan for an older used boat, an unsecured personal loan may be a good alternative.

Securing a boat loan

How to get a boat loan

If you need a loan to finance a boat purchase, you should start by checking your credit score and shopping around to compare lender rates. Be wary of high interest rates and added fees, especially if you have a low credit score and high debt-to-income ratio.

Where to get a boat loan

While there are multiple companies that offer boat loans, what you qualify for will differ based on the lender or institution's eligibility requirements. Make it a priority to research every one of the options listed to get the most competitive rate for you.

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Where to get a boat loan

Find out where to get the best boat loan.

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How to calculate how much boat you can afford

To decide how much boat you can afford, consider factors like the following:

  • The APR: Look through the lender's credit requirements, APR ranges and prequalify to see your approval odds and what your monthly payments potential interest rate could cost you.
  • Your monthly income and expenses: Calculate your debt-to-income ratio to see how much more debt you can reasonably take on while maintaining your budget.
  • Other current debts: If you have other high-interest debts, like private student loans or credit cards that have been weighing down your wallet, consider paying those down before taking on another loan. 
  • Repairs and maintenance: Before applying, calculate the maintenance, insurance and storage costs to determine whether a boat will fit comfortably in your budget. Also factor in the potential for emergency repairs and how much it could cost with your desired make and model.

Can I lease a boat?

If you're itching to get on the water but foresee the boat being docked for most of the year, renting is a cost-effective and practical way to avoid the cost and routine maintenance of boat ownership. While you do lose the everyday costs, it can still require a large chunk of change. 

Renting a non-luxury vessel can cost upwards of $200 per day, but it can cost as high as $50,000 per day if you rent a superyacht. When deciding whether renting is a good option for you, consider both the advantages and potential downsides

Green circle with a checkmark inside

Advantages

  • Try out different boat types.
  • May be able to buy at the end of the lease.
  • No upkeep or maintenance.
Red circle with an X inside

Disadvantages

  • Payments don't build equity.
  • The boat may not be in perfect condition.
  • May not be available year-round.

Alternatives to boat loans 

If a boat loan isn't in the picture, there are other ways to finance your purchase. Keep in mind that not every option will fit your finances. Before choosing an option, make sure it doesn't add too much pressure to your monthly budget. 

  • Home equity loans can also be used to finance a boating-related purchase, although it's not recommended. A home equity loan allows you to tap into the equity you've built up in your home to finance a purchase, with your home acting as collateral.
  • Home equity lines of credit (HELOCs) are also a potential solution, especially if you have an ongoing project related to your watercraft. This type of financing also taps into your home equity, but instead of being disbursed in a lump sum you can draw from it over a period as needed.

Frequently asked questions about boat loans