boat loan rules?
 

anyone out there being denied a boat loan do to the fact the the boat you were trying to purchase was older then 2007? this has nothing to do with how much the loan is for it could be for $1.00 but the fact that the boat itself is 2006 or older the bank will not loan on it. this is happening to a friend of mine right now. he is looking for about a 10k loan on an 05 sante 210 with about 150 hrs and clean as the day it was made. he has zero credit card debt. has a very low DTI with a very low mortgage and a great credit score. so what gives? he's been getting turned down by multiple banks for this boat but they will straight up lend him as much money as he wants for a newer boat. anyone else experiencing this?

Every bank has their own rules.
My credit union will give you a good rate and longer terms for anything within 2 years, between 2-5 years you don't have as long as terms and the rate goes up a percent. 5-10 years, it goes up another percent. They will not loan on a boat older than 10 years, but you can still apply for a personal loan for like 5-10k with higher interest, like 10%, and a fixed, say 5 year term and use that to buy a boat regardless of age and maybe have some cash left for immediate mods/gear.

Thats very normal actually. He just needs to find a different bank.

My credit union would give me a 10k loan for a wet cracker. Find a different bank

I just financed 19k with no down payment on a boat that's 16 years old. 8 years at 4%. Find a good credit union

Boat loans get weird. I've been offered a 5 year with 20K down at 9% and a 15 year with 0 down at 4.5% on the same boat... Always shop it around until you find something that fits you.

Like said above you just have to look. Boats are a luxury item and as such banks do all kinds of weird stuff with loans and qualifying. Same thing if you buy an RV or 4 wheeler, snowmobile..etc. Credit unions seem to be doing better on these types of loans.

yah thanks guys he's still in the shopping phase but getting similar results from bank to bank. i told him today to start looking into credit unions. will see how it turns out.

My unsecured overdraft protection is more than 10K and I'm with a run of the mill commercial bank. Sounds like he needs a different bank or maybe he isn't being straight with you about his credit. With a good credit score and low debt to income ratio my bank is begging me to borrow money from them.

What Eric said.

he has asked a few banks he said and received the same answer. they have said they wont loan on a boat older then 07. like i said it has nothing to do with the loan amount. he can buy a brand new boat if he wanted to. his credit is straight up perfect. i know how much he makes since we work together. sounds like he received a completely different story though today after joining the credit union we have through work. im going to talk to him later and see what they said. also he could take personal loans from the other banks but like stated its a higher rate

This isn't the norm. With many used boats in the 07 range still worth $30-40,000 or more if people couldn't loan on them the market would reflect that. Some people are paying cash for used boats in that range, but I would suspect more than half are loans. Plenty of people getting financing in that situation. If nothing else tell him to call the dealer and see who they are using. If a dealer couldn't get late model used boats financed to people with solid credit it would probably close them down. My dealer does most of his financing thru a local CU. In exchange for the volume of business he sends them they give buyers great rates.

He needs to use a broker. Going directly to banks for boat loans is not that helpful.

Tell him to contact Newcoast Financial. They are specialty brokers and will find a bank.

Don't use a broker, higher interest and usually a grand just for them getting u the loan. Try us bank, bank of the west I know for sure they'll do the loan if you have good credit, but you have to have 20% cash down.

Only financing 10K on an 05 Sante should be a whole hell of a lot more than 20% down.

get a home equity line of credit.

B of A was the same last year when I bought my boat. Couldn't be older than an 07.

Picked up an 08 MB B-52 with 2.9% interest

If he is putting the cash down then yes. If the boat is just being sold for 10k then that is not how the bank looks at it. Even with good credit if your debt to income ratio is off they will not do the loan sine it is considered entertainment. OP says all is good so I am under the impression there is more to it or it is just his area. I had no problem getting a loan on a 2002 wakesetter

Are we talking a boat loan that can be financed over 15 years? If yes, then I can see the bank limiting the age of the boat to 5 years or so (based on depreciated values).

If your looking for a conventional personal load and not a true boat load (as decribed above), then it should be based on the value of the boat plus any other assets you have.

The bank may be getting caught up on terminology.

While I am sure some brokers will charge more, many do not. Ignore this advice. You can call a broker, and get their best options, then you are free to contact banks.

Let me give you a good comparison...

I called BB&T and spoke to a loan officer. Stated that I wanted a 15 year loan on a new boat. Told me the best he could do was 7 years with something like 20% down and a rate over 5%. Then I contact a broker. BB&T is one of the banks they quote. Get a 15 year loan, with 10% down, and a rate of 4.24%. Who is the loan through? BB&T.

Brokers know all the ends and outs. if you go to a dealership, they will often tack on some fat. So don't go through a dealer. I've used brokers twice now in 5 years. Both times I tried going to directly to banks and it was 100% a pain in the ass.

it was b of a and another local bank. sounds like he is getting things to work through the credit union through our work. so to clarify he is buying it private party and using cash as the down and financing right around 10k thats the balance. im going to take some of the above advise back to him later. i'll let you know how things go. i'm hoping it works out for the better because i wanna ride. lol!!!! oh wait never mind i get to have MCL surgery on monday so i guess i'll be driving the rest of the summer, haha!!!

Hook him up with LAFCU Bryan.

I picked up at boat this year, I am a member of a usbank and am 22 years old, have good credit owe nothing on credit cards but do have a truck payment. The way they had me go was through a personal loan or credit line. They did 15k at 5.9% for 5 years. The boat was a 2006, they pretty much said boat loans can't let low interest rates every easy and with the age it would be hard. Plus all I had to do was go by the bank for 15 minutes after it was all approved, they didn't need collateral of any kind either and they can just give cash.

I borrowed a little for my boat from my credit union in April. 5.99% for 5 years. My boat is a 1992. I had to have the loan officer go to his underwriting committee and ask them for an exception to the age cutoff. But with my good credit score (above 800) and the fact that they would have a lot of equity in the boat vs. the amount I was borrowing, they were cool with granting me the exception. And still gave me their most favorable RV rate.

What is the age cutoff? Never heard that term in the accounting/ banking world? Your profile says your 41, is that to old or to young to get a loan? Never knew age was a factor in getting a loan. Credit history is, which sometimes makes it seem like banks won't loan to younger people.

I meant the cutoff for age of the BOAT! Just like the OP said, most loans (car loans too) have a cutoff where they don't want to lend on a vehicle that's older than a certain year.

Sorry I was confusing. Ugh, and thanks a lot for reminding me how OLD I am!!! Doh! LOL

*facepalm*
"I'm sorry, but you're too old to own a boat, how about a loan on a hoveround instead?'
lmao This had me laughing. Good times, but good info nonetheless.

Sorry man..I'm just a hair behind you!! I can tell because I am starting to surf more than wakeboard and actually enjoy it instead of cussing my old body that can only ride short sets!!

I think age of boat can be a factor if buying private party. If buying from a dealer I believe there is more leeway in how old the boat is.

If so this is a huge problem looming for many of us. As these boats get more and more expensive, used prices are much higher longer out. What is a 5 year old G23, XStar, Z3 or any of these other 100K plus boat gonna be worth in 5 years? 50-70K I'd guess. If people can't get a loan for them 90% of the people won't be able to buy them.

The best way to go is to find a credit union that groups all vehicle loans together. That way you get the same reasonable rates and loan conditions on a boat as there are for cars. I'm 23 and my credit union would have loaned up to 100% of nada value at 2.5% interest on a 10 year old 210.

Whether you're looking for a sailboat, motorboat, yacht or larger vessel, many banks offer boat financing to fit your budget. Boating is more affordable than you think. In some instances, you can buy a old or brand new boat for around $250 a month while a new PWC may be purchased for around $125 a month. Interest on a boat loan may be deductible if the boat has a galley, berth and head.
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