by Joyce Deaton

In the wake of last year’s economic collapse, many potential boat buyers hunkered down, assuming boat financing was out of reach. If you’re one of those, two local experts say, there’s good news. You can come out now.

“Credit is available for boat buyers,” says George Arnold, regional manager of Newcoast Financial Services, a specialized marine lender in Wilmington. Arnold works with boat dealers and individual buyers to find the best deals available. “We have lost a few sources when companies have left the market, but there’s still a good inventory of loan products. Interest rates have stayed fairly stable and in fact are better than last year,” he adds.

What’s different from pre-recession financing is that lenders now are looking for credit scores at least in the high 600s and require down payments on every loan. Most require a down payment of 10 percent up to $75,000 and 15 percent above that mark, says Arnold. Typically, loans under $75,000 carry a term of 15 years, while higher amounts can go up to 20 years. For larger loans, many lenders now also require verification of income.

Arnold says he’s still able to get financing for used boats, too, though requirements have tightened a bit. “It used to be easy to get a loan for a good used boat that was 20 or 30 years old. Now most lenders won’t go back more than 20 years.”

While encouraging buyers to check with their local banks, Arnold says boat-loan specialists like his company can often come up with a better deal. “We generally offer more programs and can typically get financing with better rates and over longer terms,” he explains. “Because we specialize in this market, we may see the value of a particular boat more easily than can a local bank that doesn’t deal with this every day.”

Would-be buyers shouldn’t be discouraged, Arnold emphasizes. “There’s plenty of financing available – and even some attractiveness for refinancing if you have some equity in your boat and want to lower the payments.”

Jeff Osborne, finance manager for Chatlee Boat & Marine in Sanford, agrees things are improving. “It’s not as bad as people have made it out to be,” he says. “True, it’s harder than it used to be to get financing, but things are loosening up a little. Interest rates, which went up last fall, recently have come down slightly.”

At Chatlee, a high-volume midrange dealership with more than a dozen brands, Osborne finds that banks are looking more carefully at each individual deal. While the days of zero-down financing and loans of up to 130 percent of a boat’s cost are probably gone for good, buyers with reasonable credit and cash for a down payment are being approved every day.

Banks are scrutinizing buyers’ debt-to-income ratio, credit rating and revolving credit balances more stringently than in the boom years, and most require a 10 percent down payment. And while most of them used to authorize Osborne to approve loans on the showroom floor, only a few do now – a sign they’re paying closer attention to each individual application. “That’s not a huge problem, though,” he says. “It just means we have to fax the application to them and wait five minutes to half an hour. It’s still pretty quick.” Though many variables can affect each deal, Osborne says buyers can look for loans in the ballpark of 7 percent for most boats.

If you’re thinking of buying, he adds, take advantage of cold-weather hot deals. “Manufacturers offer rebates and extended warranties, and banks sometimes offer lower interest rates in winter when business is slow,” he explains. “Shop online, then check out the models you like at the boat shows this month and next. If you think this is the year you’ll buy, go ahead and order at the boat show to lock in a better deal.”