With winter on the way, you may find yourself daydreaming of long, sunny days on the ocean. You might fantasize about sailing to warmer waters, basking in the Mediterranean sun on the deck of your yacht. But the yacht buying process can be a hassle, to say the least.
A good yacht financing company can make buying your next boat much easier. Read on to discover the benefits of financing your next yacht.
Lower Up-Front Payments
One of the best reasons to finance your yacht is that, with the right financing, you don’t have to put down as large an up-front payment. Your down payment will primarily depend on how much you’re paying for your boat, as well as what type of boat it is and how old it is. In general, the average down payment for yacht financing is between 10 and 20 percent.
Even if you have the money to pay cash for your boat up-front, there’s a lot more cost to owning a yacht than the listing price. You’ll also need to pay for life jackets, lifeboats, fuel, safety inspections, fire extinguishers, and all the tools and gadgets you need to run the boat. Financing your boat can make it easier to afford everything you need to run your boat on the front end, thanks to a lower down payment requirement.
Faster Credit Approval
Once you decide to buy a boat, you don’t want to have to wait forever for a credit approval to come through. The weather is nice now, and you want to get out on the water this weekend, not three weeks from now. But traditional credit checks can take as long as a week in some cases, and that’s before the paperwork is even finalized.
Yacht lenders know you want this process to move fast, and they can help you make that happen. When you apply for a credit approval through a yacht financing company, you can expect a response within twenty-four to forty-eight hours. You can decide on Wednesday you’re ready to buy a boat and be out on the water by the weekend.
Longer Loan Terms
Typically, when you get a loan for a vehicle – in most cases, a car – the terms tend to be five years or less. Cars don’t tend to hold their value very well, and lenders want to get their money back before the car’s value depreciates. But boats stick around for much longer use; the USS Constitution was built in 1797 and is still in good working order more than 200 years later.
Yacht financing companies know that, when you buy a boat, it’s a longer-term investment. For this reason, they will often offer fifteen- or twenty-year loan terms. This gives you more time to take advantage of market changes and rising interest rates, giving you an overall better deal on your loan.
Lower Monthly Payments
The other huge advantage of a longer loan term is that it gives you much lower monthly payments. You might not be able to afford the boat you want if you have to pay it off within sixty months. But over two hundred and forty months, that overall cost becomes much more approachable.
Lower monthly payments also make it much easier to afford the upkeep costs on your new boat. You’ll need to pay for routine maintenance, as well as renting a harbor slip and paying for any licenses and permits you need to operate it. All of that can stack up with a high monthly payment, but a lower payment makes it much more feasible.
Equipment Financing Options
Buying a boat is a little like buying a house – getting the structure is only the first step in your purchasing process. When you buy a house, you have to buy furniture, kitchen appliances, bedding, bathroom accessories, décor, linens, entertainment systems, and much more. When you buy a boat, you’ll need radar, fish finders, a marine GPS, fishing gear, life jackets, cabin furniture, etc.
Buying this equipment outright is expensive, and traditional lenders won’t want you to roll those costs into your loan. But yacht lenders know how important your gear is to your boating experience. They will often allow you to finance the cost of your equipment with the original loan so you can get the boat you want now, rather than years down the line.
Expert Guidance
Whether you’re an experienced seaman or this is your first boat, the boat buying process can be confusing. Banking staff may not be familiar with the yacht financing process, and protocols are always changing. You have to juggle paperwork, handle credit approvals, decide which equipment you need to finance, and keep things moving quickly.
When you finance your yacht, you can get expert guidance to help you with your buying process. These lenders will be familiar with the intricacies of the yacht financing process and can make sure everything moves smoothly. They can also make sure you get the best option for your situation and needs.
Easier Buying Process
Unfortunately, the complexities of the boat buying process don’t end with the financing. You also have to handle sea trials for your new boat, get it surveyed, manage Coast Guard documentation, and more. Tackling this process on your own can be daunting, to say the least.
A yacht financer can do more than just help you get the loan for your new boat. They can also help you keep up with all the paperwork, documentation, and inspection processes you’ll need to do. This makes for an easier buying process so you can get to enjoying your boat faster and hassle-free.
Learn More About Yacht Financing
Buying a new boat is an exciting process, but it can be a complex and drawn-out one without the right assistance. Yacht financing can help you get the boat you want without having to pay so much up-front or every month. It can also help you get the equipment you need, as well as getting your yacht properly inspected, certified, and licensed.
If you’d like help financing your next yacht, get in touch with us at Shearwater Aero Capital. We offer asset-based financing for aircraft, yachts, high-end real estate, and more for clients across the globe. Contact us today to start the process of getting your next luxury asset the easier way.
