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Tips for a House Boat Loan Approval!
Helpful tips from Houseboat Owners to help get a House Boat Loan.
After 30 years of boating, and many houseboats later, my wife and I
will share some Tips to help you get that perfect House Boat Loan.You really want that loan because you've looked at over a dozen boats, and finally found the perfect one. You want to understand how to improve your finance possibilities, and preferably a good rate on a Houseboat Loan. You'll look at some of the Tips, some Basics, the Pros & Cons, Sources & Types of Loans, the Criteria, and the Credit Rating numbers that financial institutions use to approve applications. The goal, a Dream Houseboat!
Tips to help get your Loan approved!
The Pros & Cons of House Boat LoansWhat are the differences when financing a NEW or USED Houseboat?
Monthly Payment is directly related to the Loan Amount, and length of Time to re-pay. The larger loan, by longer the term, equals to more interest to be paid. Click here to use a free Loan Comparison Calculator
Term of Loans depends on age of boat. Therefore New or Newer boats can go up to 20-25 years, and older boats generally cannot be financed for as long, thereby increasing the monthly payment.
Down Payment is the amount of cash, or "trade-in" value that is being applied to the purchase price to reduce the amount of financing required.
Depreciation is a factor that needs to be addressed when deciding to purchase a "new or used" houseboat. Just like cars, they tend to go through a greater depreciation during the first few years, than later on.
Sources for House Boat LoansYou preferably want to find someone who specializes in Boat Loans, and if possible, in Houseboat Loans. You can get better service and rates. Your first choice can be House Boat Loans companies, second choice can be Banks & Credit Unions, and the last choice would be Financial companies.
House Boat Loan companies understand your needs, and are better equipped to handle your application. Have a look at them, and then do a comparison survey for your needs. Here are three well known firms.
The links below will open in a new window.- Click here to go to eBoatLoans for more details.
- Click here to go to Excel Credit for more details.
- Click here to go to First Again for more details.
Banks & Credit Unions can be a second alternative, yet some appear to not be prepared or interested to handle a Marine Loan application.
Financial Companies can be another alternative, yet do look at the fine print to verify interest rates, conditions, and the total cost involved.
Types of House Boat LoansFixed Rate, Fixed term is commonly used in the industry. The length or term of the loan, and the interest rate stay "fixed".
Variable Rate, Fixed term is also popular since the borrower can have a "variable" or fluctuating interest rate, and benefit from any decreases.
Balloon payment loans is another choice, which allows for the total loan amount, including interest be paid at the end of the pre-determined term.
Use this free Loan Comparison Calculator to compare loan amounts & monthly payments. This will open a "new window" for the calculator.
Boat House Loan CriteriaDown Payment is the amount of cash, or trade-in value that will be applied to the purchase. Generally the amount can range from 10-20% of the purchase price. On some NEW Boats, no cash down is available.
Credit Rating is one of the criteria that lending institutions will consider when reviewing a loan application. Have a look at our Credit Tips below.
Debt Ratio is a factor calculated as a percentage of available income, less total debt. You generally want to stay below a 40% debt ratio.
Why a Pre-Loan SurveyPurpose and Cost of Survey is to an overview document of the Value, Seaworthiness, and Condition of the vessel. Costs can vary, but a ballpark figure can range from 10-30$ a foot, however this in money well spent!
Survey Now or Later is a question that we get asked often. Insurance and Financial institutions now generally require a Marine Survey before proceeding, so save yourself the trouble, so get it done first.
Benefits of a Survey are that the prospective buyer can ascertain the Condition, Value, Seaworthiness of the boat, and can use to evaluate, or negotiate the purchase price. A survey is required for Insurance & Loans.
Find a Qualified Surveyor in your area by visiting the sites below, or contact me directly and I'll try to connect you with someone qualified.
- SAMS Marine Surveyors at www.marinesurvey.org
- NAMS Marine Surveyors at www.nams-cms.org
Credit Rating TipsCredit Rating basics is simply an overview showing the way Financial Institutions look at loan applications. Credit reporting agencies like Equifax will compile information on consumers, and apply a FICO Score to rate the applicants credit health & credit worthiness. You should know your Score.
Eliminate surprises, check your credit rating first, before applying.
The preference is to use Equifax Credit Report to view your credit file.
It's a simple process, and helps you get a better understanding of how your application will be evaluated. Our recommendation to you is to get the Credit Report first, then apply. Get Your Equifax Credit Report Now!
Other Factors to Consider are Debt Ratio, Collateral, Down Payment, and your Credit History. These are all things Lenders will be considering.
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