One of the most enjoyable times spent is being out on the water with family and friends. As a captain, I spent days on end offshore and dockside aboard the vessel. Without question, there is a draw that pulls people to the water versus remaining on shore. However, in order to make this happen constantly, you need to purchase a vessel or join a boat club. Remember, buying a vessel is expensive. For this reason, it is not uncommon to get a boat loan. You should know if it is worthwhile to take a loan on a boat. 

What Are The Benefits Of A Boat Loan

Lets face it, the vast majority of the population does not have enough cash sitting around to buy a new boat outright. 

However, loans are available to bridge the gap between putting money down and making the final payment years down the road. Keep in mind you’re paying interest in addition. 

Here are the key benefits of taking a boat loan. 

They Allow You To Buy A Boat In The First Place

First and foremost, a loan gives a buyer the opportunity to buy a boat if they do not have enough cash on hand. 

In the event that you want to own your own boat, a loan is likely the only avenue to make this dream become a reality. 

Remember, when you’re taking a boat loan it is imperative to shop the rates, you don’t want to get stuck overpaying in interest when it is not necessary. 

The Loan Spreads Out Payments

Another benefit of a boat loan is the fact that it spreads the payments over a number of years. Rather than depleting the bank account, you can opt to pay monthly to lessen the burden. 

However, a substantial down payment will decrease monthly payments and lessen the total amount of interest over the life of the loan. 

When I purchased boats I bought used and paid cash versus taking a loan. However, new vessels don’t come cheap. In order to get enjoyment out of it now by paying monthly you’re going to need to take a loan. 

Considerations When Taking A Loan On A Boat

There are a multitude of considerations when taking a boat loan. It is important to consider this before making the decision to buy a boat by borrowing money from the bank. Here is what to consider. 

Make Sure You Can Cover The Monthly Payment

Unfortunately, people who wish to become boat owners fail to review their financials thoroughly before making a purchase. 

Without question, you’ll run into financial troubles if you fail to make payments compared to waiting until you can cover the monthly expense. 

With that said, ensure that you have not only enough money to pay the loan but also to make repairs, cover the storage fees, and fuel costs. By no means is boating cheap. 

Feel Comfortable In Your Employment Status

No status of employment is a guarantee. A company’s financials can change quickly and unexpectedly. However, you should consider the stability of your job or your business before investing in a boat. 

One of the most scary situations is losing a job or a business when you’re deep in loans. This is one of the most stressful scenarios because what matters most is feeding your family and yourself over boat ownership. 

For this reason, you should consider the stability of your career before agreeing to a long-term loan on a boat. You don’t want to live day to day in fear that your boat will be repossessed and your credit will be ruined. 

You Must Use The Boat Often

One of the last considerations is ensuring that the boat will be used with enough frequency. Remember, buying a boat is a big expense. 

In the event that you’re only going to be free to go boating during holiday weekends its a bad idea to take a loan and purchase a vessel. 

I suggest investing in a boat only if you’re planning to use a boat on a weekly basis. You’ll be throwing out money if the boat is left dockside or on the trailer week after week. 

Decide If You Should Take A Boat Loan

Making the decision to take a boat loan does not come lightly. Remember to take into consideration all of the factors. Also, rather than taking a loan you can consider purchasing an older vessel in good condition. The asking price will be significantly less than that of a new vessel on a dealerships lot. Lastly, shop the rates if you’re buying a boat with a loan.