Available Boat Loan Terms: 15 vs 20 Year?
When seeking available boat loan terms, many lenders offer you a 15 year or a 20 year repayment schedule. It is difficult to determine which works best, here are a few tips to consider:
Most lenders are going to suggest you stick to a 15 year payment term that can fit your budget. A shorter term may also be accompanied with a lower interest payment. It’s always a better idea to obtain loans with shorter payment terms to keep your overall costs lower in the long run.
However, many expensive boats, although being purchased with an appropriate down payment, might deliver an unaffordable monthly payment without extending the life of the contract. Obtaining a 20 year term payment for your boat loan may put that monthly payment into a manageable budget you can handle.
Also, keep in mind that rates are lower for shorter payment terms. Typically, you can choose a fixed interest rate for the entire term so keep your payments steady.
Before determining whether the lender will extend you a 15 or 20 year payment schedule, a boat inspection will be necessary to determine if the vessel is in tip-top shape to act as the necessary collateral for your loan.