What Is a Good Interest Rate for a Boat Loan?

The best interest rates for boat loans currently start around 6.99%

By
Karon Warren
Karon Warren
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Karon Warren has 20+ years of experience researching and writing about banking, mortgages, credit cards, savings, and other personal finance topics.

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Updated January 11, 2024
Fact checked by
Ben Woolsey
Ben Woolsey
Fact checked by Ben Woolsey
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Ben is an Associate Editorial Director at Investopedia focusing on financial products and services. He has spent his career working for banks, credit card issuers, and credit card marketplace websites in marketing, operations, and content management roles.
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Borrowers with strong credit may find boat loan rates as low as 6.99% APR. Of course, the boat loan interest rate varies based on a number of 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 7.49%. 
  • 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. There has been an increase in the boat loan interest rate because the Fed has raised rates to slow inflation. This has affected interest rates on many products. For instance, the average interest rate on a 15-year mortgage with a fixed interest rate is 6.86%. For new cars, the average interest rate is 6.79%.

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 6.99% $4 million 20 years 575
Trident Funding 7.74% $2 million 20 years 600
LightStream 6.99% $100,000 12 years None, but good credit recommended
Mountain America Credit Union 8.99% 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 6.99% 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. 

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.

  1. Experian. "State of the Automotive Finance Market Report

  2. Southeast Financial. "Boat Loans and Financing."

  3. Trident Funding. "Current Boat Loan Rates."

  4. LightStream. "Boat Loans and Refinancing."

  5. Mountain America Credit Union. "New and Used Boat Loans."