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What Is a Good Interest Rate for a Boat Loan?

The best interest rates for boat loans currently start around 6.74%

By

Karon Warren

Updated November 25, 2024

Fact checked by

Ben Woolsey

Woman on boat — Klaus Vedfelt/Investopedia.com

Borrowers with strong credit may find boat loan rates as low as 6.74% APR. Of course, the boat loan interest rate varies based on several factors, including the loan amount, length of loan, and the borrower’s credit score and history.

Key Takeaway

Many boat loan interest rates start around 7.00%.
Four boat lenders offering low rates include LightStream, Southeast Financial, Trident Funding, and Mountain America Credit Union.
Interest rates vary based on such factors as your credit score.
Some lenders may finance boats as old as 20 years.

How Do Lenders Calculate the Interest Rate on My Boat Loan?

Boat loans work similar to personal loans, with a number of factors determining the interest rate on a boat loan. These include:

The borrower’s credit score
The borrower’s financial information, such as credit history and income
The purchase price of the boat
The boat’s age
The loan term

Also, interest rates fluctuate depending on market conditions and inflation and how the Federal Reserve responds to these.

Other Factors that Affect the Cost of Your Boat Loan

Additional factors that affect the cost of your boat loan include:

Loan amount
Down payment
Fees such as origination fees
Length of the loan
Borrower’s credit score

To get an idea of how much you would pay for a boat loan, use our personal loan calculator.

What Is the Oldest Boat a Bank Will Finance?

This varies by lenders, but some lenders will finance boats that are 20 years old or older if they are exceptionally valuable.

Boat Lenders With Low-Interest Rates

There are a variety of lenders for boat loans, ranging from banks and credit unions to marine dealers.

Lender	Starting interest rate	Max loan amount	Max loan term	Minimum credit score
Southeast Financial	6.74%	$4 million	20 years	575
Trident Funding	6.74%	$2 million	20 years	600
LightStream	6.99%	$100,000	12 years	None, but good credit recommended
Mountain America Credit Union	8.49%	Unknown	15 years	None

What Is the Difference Between Interest Rate and APR?

The interest rate represents the cost of the loan for the borrower and affects how much you pay each month on the loan. APR, or annual percentage rate, represents how much the loan costs each year. This includes not only the interest rate, but also the additional costs of the loan, such as origination fees, points, and other fees.

What Credit Score Do I Need to Get a Boat Loan?

Credit score requirements vary by lender, but the higher your credit score, the more likely you are to receive favorable terms on a boat loan.

What Is the Average Term on a Boat Loan?

On average, boat loans are for between 10 and 15 years, but it’s possible to get boat loans with shorter or longer loan terms.

What Is the Typical Down Payment on a Boat Loan?

Typical down payments for a boat loan range between 10% and 20% of the purchase price.

Can I Expect Loan Boat Rates to Go Down?

Beginning in Q2 2022, the Fed began increasing interest rates in an effort to slow record-high inflation, so rates could still possibly increase if the Fed's inflation target doesn't reach 2% or remain unchanged in the near term, depending on economic conditions. However, there are growing expectations that the Fed might begin to cut rates at some point in 2024.

The Bottom Line

Interest rates on boat loans generally start around 6.74% for those with excellent credit. Several factors affect the interest rate a borrower will pay—namely their credit score, the loan amount, the age of the boat, and the loan term. To get the best interest rate, shop around with different lenders to see which one offers the lowest rate and best loan terms.