| Once you've made your decision to buy a boat the | | | | significantly higher. However, there is one caveat to |
| first thing that usually crosses your mind is, "How am | | | | this approach. If you buy a boat with zero down, |
| I going to pay for it." The majority of purchases | | | | make minimum monthly payments and then decide to |
| involve some level of boat financing, whether it's a | | | | sell the boat soon thereafter, you may actually owe |
| credit line through the home, an unsecured loan, or a | | | | more than it is worth. |
| conventional boat loan. Choosing the right financing | | | | The recent combination of high property values and |
| source can be as important as choosing the right | | | | low interest rates has made home equity loans and |
| boat. | | | | credit lines a viable option for boat financing. This |
| There are several factors to take into consideration | | | | option can be particularly good for individuals with a |
| when choosing a boat finance source. The first might | | | | challenged credit profile. These loans are based on |
| be to determine how long you intend on keeping the | | | | the equity available in the home and can allow a |
| boat. If you are purchasing an entry level first boat, it | | | | person with poor credit to get affordable terms that |
| will make sense to find a boat loan that will be | | | | otherwise would not be available. The drawback to |
| flexible in the event of early payoff through a private | | | | these loans is that the home equity is now tied up in |
| party sale or trade-in. Conversely if you are | | | | a boat purchase. Conventional boat loan rates are |
| purchasing the boat of you dreams and expect to | | | | very low. A person who can qualify at agreeable |
| have it for a long time it will be important to lock in | | | | terms is usually better off with a conventional boat |
| at a fixed rate loan with terms that will allow the | | | | loan. This will allow a person to keep the equity in the |
| comfort of a low monthly payment. This will allow | | | | home for an emergency along with the ability to sell |
| you to make sure the boat will always be affordable | | | | without encumbrances. |
| in future months. | | | | Choosing the right boat loan is an important step in |
| Another factor to consider is the down payment. | | | | the buying process. A good place to start is with a |
| Most lenders would like to see ten percent down for | | | | boat finance brokerage, for example that can show |
| a boat loan. However, zero down scenarios do exist | | | | you how each of the options will fit into your profile. |
| for people with optimum credit profiles. Generally, the | | | | This will give you the ability to find the loan that fits |
| down payment does not significantly effect the | | | | you best. Then you can concentrate on the |
| monthly boat loan payment. You may be more | | | | important stuff — like your first trip to the |
| comfortable keeping the extra money in your | | | | water. |
| account in exchange for a payment that is not | | | | |