Owning a yacht is one of the signs that you’ve “made it”, but you don’t have to be an oil baron or the CEO of a multinational company to own a yacht. With an abundance of yacht financing options, owning your own vessel has never been more accessible.
Although most yacht purchases continue to be cash-based, boat financing has quickly become a popular way of entering the market and making your dreams come true. But with so many financing companies, knowing where to turn is tough.
In this guide, we’ll show you the top five yacht financing companies to point you in the right direction and help turn your dreams into tangible ownership.
What are Yacht Loans?
Yacht loans work the same way as any other type of loan. You apply for a loan for your boat, which will be approved at a set rate. Make the required monthly payments until your loan is fully paid off and you have no further liabilities.
Your loan may be secured or unsecured. The former means that your loan is secured against an asset. In most cases, this is the vessel itself, but if you’re borrowing more, you might be required to put up other assets as collateral.
Some of the benefits of taking out loans instead of paying in cash include:
· Avoid reducing your liquidity.
· Purchase high-end boats.
· Spread the cost over time.
Using debt intelligently enables you to purchase those luxuries in life that would otherwise require digging into your savings. Although rates have been higher in recent years, more competition in the yacht loans market is rapidly bringing them down, enabling buyers to get better deals than ever.
However, that requires shopping around, and many aspiring yacht owners often don’t know where to turn or what the advantages of these loans are.
5 Yacht Financing Companies for Owning a Yacht
Private yacht experiences start with adding your very own vessel to your portfolio. Instead of worrying about schedules and availability during the main cruising season, owning a boat presents unrivalled freedom to go at your own pace.
So, which financing companies should be on your radar?
1. CGI Finance
CGI Finance is one of the more prominent financing companies serving the European market. They offer fixed and variable-rate boat loans for new and pre-loved vessels. Depending on how old the boat is, you can take out loans ranging from four to 15 years.
As one of the biggest market movers, CGI Finance is the leader in the European marine industry, setting the benchmark for customer service and authentic bespoke financing solutions.
2. Close Brothers Aviation and Marine
Need extra flexibility when financing your dream boat?
Close Brothers are specialists in dealing with less than straightforward finance situations. Rather than providing a few basic solutions, they’ll take the time to get to know your finances and provide a loan that suits it. Granted, the rates can be higher because of their tailored approach, but it’s a small price to pay for the yacht loan you truly need.
3. Pegasus Marine Finance
Pegasus prioritizes quick and easy loans for aspiring captains. Applying for a loan from Pegasus requires nothing more than filling out a simple online form with decisions within a few days. Owning a boat through boat financing could be closer than you think, with secured and unsecured loan options available.
Despite their speed, they still retain flexibility. Additionally, their loans don’t require you to put down a deposit.
4. Promarine Finance
Promarine Finance is perhaps the fastest financing company in the industry. If you’re trying to pick up a once-in-a-lifetime deal at a boat auction, or you just don’t want to wait to start scything your way through the ocean waves, this is the lender for you.
Your application’s approval time can take as little as 30 minutes, with loan amounts starting at just £5,000 and capping out at £150,000. Promarine is all about straightforward financing without the bells and whistles.
5. Moorgate Finance
Moorgate Finance is one of the newest entrants to the boat financing sector. Despite this, they handle financing like pros, focusing on premium marine sectors.
In the context of yacht financing, premium sectors are high-value and specialized areas of the industry. For example, this may include financing for luxury boats and superyachts that other financing companies might be unwilling to finance.
Due to the unique characteristics of purchasing a high-end vessel, you’ll need a specialist to step in and provide the tailored support needed to see your purchase through. Moorgate is one of the few financing companies operating in this sector.
Conclusion: Own Your Vessel With Marine Financing Today
Applying for a loan for your boat just makes sense as the industry becomes more competitive. Getting approved for financing ensures you don’t miss out on the ship of your dreams, and you can take to the ocean faster.
What boat do you want to add to your collection this year?
Boat Financing FAQs
How to finance a boat in the UK?
Financing a boat in the UK is simple enough. You can go through your bank, work with a specialist marine financing company, or even get a loan through your yacht dealer. Pre-approved loans are available, too. Explore your options to see which makes the most sense.
What is the longest term you can finance a boat?
Most boat loan terms range from 10 to 20 years, on average. However, loans are available for as little as five years. How long your loan is largely depends on how much you’re borrowing, the age of the vessel, and the type of boat you want to buy. Of course, every lender will have their own parameters.
What is the average interest rate for a boat loan?
The average boat loan interest rate is anywhere from 7% to 10%. Rates fell recently because of declining interest rates across central banks and the fact anything 10% is unattractive to buyers.
Your rate reflects several factors, including the boat’s age, type of boat, and your credit score.