Marine mortgage explained

With an increasing range of boat and marine finance options available, the dream of owning a boat has become more accessible to many more people. Marine Mortgage is a popular choice for those looking for funds to buy a boat.

What is a Marine Mortgage

A Marine Mortgage is a loan secured against the boat/vessel that you are purchasing. Different deals and lenders come with different terms and conditions, but Marine Mortgage agreements typically range from two to seven years, with the borrowed amount ranging between £15,000 and £350,000.

Most mortgage agreements require a deposit of between 10% and 20% of the total purchase cost and you can expect repayments and interest to be fixed throughout the lifetime of the agreement, making it simple to track what is expected of you in terms of payments.

With so many lenders and different mortgage plans available it can seem like a daunting task to find the best deal for you. You can look at online mortgage comparison sites or look to work with an expert broker to explain the process and find you the best deals.

What types of loan are available with Marine Mortgage?

In much the same way as home mortgages, Marine Mortgages are usually offered as fixed-rate, simple interest or variable rate loans by lenders. Variable rate mortgages often offer the lowest rates as the mortgage starts but, as they are “variable”, they could increase to become much more expensive at any given time.

As a simpler option, you will always know where you stand with a fixed rate loan as repayments will always stay the same for the length of the agreement. Rates vary widely, but you can expect to pay rates between 3% and 8% APR.

Finding the right marine mortgage provider

What should you be looking for from a mortgage provider? The marketplace is packed with different lenders. You should be looking for a reputable provider with a solid history of customer satisfaction.

It is clear there are many options to help you afford your dream boat, but who should you borrow from? The marketplace is wide and complicated, so you need to research as many different lenders (and their wide range of products) before settling on a lender.

All lenders want your business and some offer marine accessories and tax included in the deal, allow you to pay a larger deposit to reduce on-going payments and help spread the set-up costs. Others will try and sway you with competitive interest rates or low minimum repayment figures, but these can also, often, hide hidden charges and rate increases in the fine print. Always check everything to do with a deal, if it looks too good to be true, there is every chance that it is. This is where the services of a reputable broker can be invaluable.

What is the process for getting a Marine Mortgage

If you decide to go ahead with buying a boat and need a Marine Mortgage to fund that purchase, these are the general stages you need to go through to shop with confidence:

1. Do your boat research – find out what kind of boat you want, how much it will cost and the practicalities of ownership.
2. Work out your budget
3. Research the Marine Finance market – what is on offer, what are the best deals and how much can you borrow? This is a good time to start speaking to a broker.
4. Find your boat
5. Choose your Marine Mortgage provider
6. Secure your mortgage
7. Conduct a boat survey – this will access the quality and standard of the boat to avoid any nasty surprises after the sale.
8. Negotiate and finalise the price with the seller
9. Finalise the mortgage agreement
10. Buy your boat

By following the above process you will take ownership of your dream boat and will be ready to take to the water.