How Long Can I Finance a Boat For?

Owning a boat is a dream for many, but the price tag can sometimes make it feel out of reach. Maybe you've asked yourself "should I finance a boat?" or wondered if it's something accessible to you. In Canada, there are financing options that are designed specifically for boats, with flexible terms and competitive rates. Whether you're buying your first boat or upgrading to a bigger one, financing could be the key to getting on the water sooner.

How Do Boat Loans Work?

Boat loans allow you to spread the cost of purchasing a boat over several years, making it easier to manage your budget. Unlike personal or automobile loans, banks in Canada allow longer amortization periods for boat loans, which means smaller, more affordable payments. There are a few reasons for this:

Boats hold their value. Boats will typically hold their value better than any other vehicle (think cars), and they act as the collateral in the loan which is less risky for the banks to finance.

Specialized Loans. Lenders with expertise in recreational financing understand the high cost of boats and structure these loans with longer repayment terms to make them more practical.

Industry Standards. The boating industry encourages longer financing terms to align with the premium nature of the products. This helps manufacturers and dealerships sell higher-end boats by making them affordable through extended loan periods.

How Long Can I Finance a Boat For? 

New boats: You can finance a new boat for up to 20 years, giving you ample time to pay it off.

Used boats: The maximum loan term is usually 20 years minus the boat's age. For example, if you buy a 2020 boat in 2024, the maximum loan period would be 16 years.

Some dealerships handle financing directly in-house, while others work with brokers. There are pros and cons to each, but loan brokers may have access to slightly better rates due to the overall volume of business and the relationships with multiple lenders/banks.

Steps to Apply for a Boat Loan

Find your dream boat. Once you've decided on the exact model and know the purchase price, you're ready to secure financing.

Get pre-approved. With your approval, the lender will check your credit score and seek a pre-approval on a boat loan. This process is often referred to as a hard credit check, and can cause a very slight and temporary decrease in your credit score.

Provide details. Lenders will ask for information about your income, down payment, and whether or not you have a trade-in to process.

Finalize the terms. Loan factors like interest rate, term length, and payment schedule depend on factors like your credit score, the boat's age, the amount you're borrowing, and the current prime rate. All loans are "O.A.C" - on approved credit, subject to the bank approving your loan and your creditworthiness. The downpayment can be as low as $0 in some cases!

Why Should I Finance a Boat? The PROs:

Keep Your Savings Intact. Financing lets you preserve your savings or investments for other priorities.

Enjoy Flexible Payments. Spread out the cost over the years to fit your budget. Boat loans are almost always "open" and can be paid down partially or fully with no restrictions once the initial hold period passes.

Start boating now. You don't have to wait to save the full purchase amount, financing can allow you to get on the water sooner. There are very few summers left in your life and you should make the most of them.

Peace of mind. Financing through a reputable dealer or broker ensures a smooth process and access to better loan options.

Example Boat Loans

Here are two examples to show how boat loans might work in real life:

Example 1: New luxury pontoon, $110,000 loan, pay the HST (taxes) as the down payment, 20 Year Amortization, $853 / month or $393 bi-weekly

Example 2: 8 Year old used bowrider, $55,000 loan, pay the HST (taxes) as the down payment, 20 Year Amortization, $566 / month or $261 bi-weekly

Financing a boat can be a practical way to make your boating dreams a reality without draining your savings. However, it's important to assess your financial situation and ensure the loan will fit comfortably in your life. By working with a trusted dealer and/or broker, you can explore your options and find the right solution. 

Boating is about more than just owning a boat - it's about creating memories and enjoying life on the water. With the right financing plan, you're one step closer to enjoying those moments with family and friends. Click here for a free, no-obligation boat payment calculator!