Boat Financing Basics
Consider Other Costs
Other costs to consider when organizing your finances and buying a boat are dockage fees, gasoline, supplies, and general maintenance. If you are keeping your boat moored at a marina, this could be your biggest annual expense. Don’t forget to find out how much winter storage costs at the marina you choose, as this could be another factor you will have to budget for.
As of this writing, gasoline prices have come back down to Earth, but fuel will still be one of your larger boat owning expenses. My single-engine 27 foot express cruiser requires a full tank of gas every weekend when I use it regularly; and a boat’s gas tank is much larger than a car’s. For example, Sea Ray’s 39 foot 360 Sundancer has a fuel capacity of 250 gallons (946.2 L). Of course, that sport yacht has two engines and may be bigger than your first boat, but many models over 25 feet have twin engines and subsequently will require more fuel to operate.
Help from Uncle Sam? If you are thinking of buying a boat with a head and a galley (that’s a bathroom and a kitchen for you new boaters), you may be able to claim your interest on your boat loan when you file your Federal income tax in the United States each April. These features, which are standard on most express cruisers, and sailing and motor yachts, may make your boat qualify as a second home in the eyes of Uncle Sam. Don’t forget to save your fuel receipts every time you fill up on the water. Another perk from the US government: a credit or refund may be allowed for the excise tax on fuel used in a boat, since a portion of that tax is used by the government to repair and maintain roads. So as a boater you may be able to get that portion back, since you are not doing any damage to the road while you are boating. Check with the IRS website for details of these potential savings.
You can also buy some boats that have been donated to charity. Not only will you likely save some money, but the money you put toward the boat will go towards a good cause as well. Also consider the fact that there are plenty of perks that go along with donating a boat. There are resources online that can help you out if you’re unsure of how to donate a boat. You can even use a boat donation as a fairly large tax write-off, and put those potential profits towards buying another boat.
Back to boat loans, there are many online tools available to figure out how much you can borrow, and how much you can afford to spend on your new boat. On this page are some links to sites that have free online calculators, as well as free quotes for financing a new or used boat.