It’s the question so many prospective boat owners are asking themselves. You may have already found the perfect boat and negotiated the sale price or perhaps you simply want to get your boat loan set up in advance, so you are ready to buy when the right boat comes on the market. In either case, you may find yourself wondering, “Will I be approved?

Of course, only the lender you decide to work with can ultimately determine whether you will qualify for a boat loan or not, but if you want to get an idea of what your chances are, these are some factors prospective lenders will weigh:

Factors That Affect Boat Loan Approval

A lender will take into consideration both the condition and valuation of the boat plus your financial history and circumstances when deciding on your loan application. To be approved, both you and the boat must meet the standards set by the lender.

Condition And Value Of The Boat

Maximize your odds of approval by choosing a boat that is new or less than 15 years old, is in good condition, and is priced at or below its appraised or fair market value. The lender needs to view the vessel as a good investment, not one which they would lose money on if you defaulted on the loan and they needed to resell it. Below is a general rule of thumb for the ease in which you can secure financing if the vessel is a certain age:

  • 30 years old: Very difficult
  • 20 years old: Difficult but possible
  • 15 years old: Better
  • 10 years old: Good
  • 5- years old: Great

Your Financial History

As with other types of loans, your credit score, credit utilization ratio, and any derogatory bad credit indicators like late payments or foreclosures will come into play. These factors will also be used to determine the interest rate you qualify for. Lower interest rates will be extended to applicants with higher credit scores. While applicants with a lower credit score may be able to qualify for a boat loan, the loan terms will likely include a higher interest rate. If you have many other loans or are carrying significant credit card debt, this can also interfere with your ability to get approved for boat loans. 

Size Of Your Down Payment

The higher down payment you can make, the less risk there is for the lender and the more likely you are to be approved. Lenders typically require a more significant down payment for a boat than they may for a house since a boat is viewed as a luxury item. Save up for a down payment to make sure you can meet or exceed the lender’s threshold.

Where To Get A Boat Loan

Now that you know what your lender will be looking at, it’s time to apply for your new or used boat loan. Azure Funding is ready to help you finance a boat. Contact us to discuss your boat purchase and learn what financial services we have to offer.



*All information in this post including, but not limited to, quotes, rates, term-length, and other loan information is purely informational and may not reflect your actual terms. Actual loan terms will be dependent on a number of actors including your personal credit history, assets, debt to income ratio, and more. Please speak with an Azure Funding representative today by clicking here to discuss your individual financial situation.