Boat Title Loans

A boat title loan can be a good option for those who might want to secure cash in the short term but do not want to sell their boat. With a boat title loan, you can get up to $1 million from your boat if it is registered as collateral and secured by your property. The loan must be discharged within 24 months of approval, and the lender may not retain any interest in the collateral until then.

When taking out a boat title loan, you will likely be charged interest rates between 15% and 30%. Even though these rates are high, they may prove more affordable than the rate on a boat title loan offered if you do not have the collateral. 

Boat title loans are not ideal as a long-term financing solution, but they can be a convenient way to cover a short-term need. The loan application process is much quicker than a standard bank loan or line of credit, and the money is often available within 24 hours.

Borrowers should also be aware that boat title loans carry interest rates much higher than traditional bank loans or lines of credit. However, even though these rates are high, they may prove more affordable than the rate offered if you do not have the collateral. Most lenders will lend money against your boat if it is titled in your name, even if you do not live in the same state as it is registered.

How does a Boat Title Loan work?

When you take out a boat title loan, your lender will file a Notice of Intent to Lien on your vehicle’s title. It is done to ensure that the appropriate information is on record with the DMV. Borrowers who take out a boat title loan should keep track of their loan repayments to avoid surprises. The lender may cancel or suspend the loan if you do not make payments.

This lending can be beneficial because it allows borrowers to obtain cash when needed but still maintain possession and control over their boats and property. The same can not be said for standard bank loans or lines of credit, typically requiring borrowers to sell their boats and cede control over them.

To be eligible for a boat title loan, the vessel’s owner must have good credit and full rights to use the property as collateral. When deciding whether or not to take out a boat title loan, you should consider all your options and carefully weigh your financial needs.

Your lender will typically require you to provide proof of income and assets to qualify for a boat title loan. In addition, the boat must meet all state requirements and be registered with the DMV for it to be used as collateral for the loan.

If you are making a down payment, your lender may also require you to provide proof of the funds used for the loan’s origination. This may include providing a bank statement or cashier’s check that was issued up to 14 days before submission of your application.

Your lender will likely charge you a document preparation fee, usually between $250 and $300. You will also be required to pay an administrative fee for a boat title loan. This amount is usually around $100, but it can be higher or lower depending on your state and the terms of your loan agreement. Unsecured boat title loans do not have collateral protections like those in secured loans.

Before applying for a boat title loan, you should check your credit history to ensure you are eligible for the loan. This will make it easier to compare loan options and allow you to make an informed financial decision.

If your credit score is low or non-existent, you may want to consider waiting until it improves before applying for a boat title loan. However, this is not always necessary. If you have been pre-approved for an unsecured boat title loan with a lower interest rate than secured loans, this might be the better option for your needs.

Borrowers who take out boat title loans must provide proof of their income and assets to qualify for the lending. This documentation form is a standard part of the loan application process and will be required for secured and unsecured loans. It only needs to be submitted once, but it is worth keeping for future reference.

What are the Benefits of a Boat Title Loan?

The main benefit of a boat title loan is its quick approval process. Borrowers can often get the money they need in as little as 24 hours. Many lenders even offer emergency loans, providing cash to approved borrowers on the same day that they apply for it.

Most lenders will process your application within one business day, and you usually have between 30 and 60 days to repay the money you borrow. This quick turnaround time is ideal for borrowers who need cash in an emergency.

Another benefit is that these loans are risk-free for lenders. Mortgages are a much riskier means of collateralizing property than a boat title loan, making them easier to approve without extensive checks into your financial history. Because boat title loans are not restricted to a specific state or location, they allow you to tap into new marketplaces and purchase items you could not otherwise obtain.

How can I get a boat title loan?

To obtain a boat title loan from your lender, you must fill out an application form and provide information about yourself, your income, and your boat. You will also need proof of ownership for your vessel and its current value if it is not already in your name.

Lenders will likely want to see documentation of that if you own any other possessions or property. This may include real estate mortgages, insurance policies, or tax returns. Borrowers will often be required to provide proof of their assets and income, and they may be asked to provide more information about their financial situation.

Your lender may also request that you sign a loan agreement, but this is not essential. Your lender will ask for your insurance policy and other valuable documents, like your vehicle title, before sending your loan application through the system.

A third-party agency will conduct a typical credit check. This could be performed by a credit agency that handles consumer and personal loans in the same area or by a different company altogether.

You may have to fill out some forms that ask for specific information about yourself or the value of your property. If your application is approved, your lender will usually issue a boat title loan agreement you must sign. You must then send the signed agreement and the documentation requested to your lender.

How much money can I borrow with a boat title loan?

The amount of money you can borrow with a boat title loan can vary depending on the lender and your state’s regulations. In general, the amount of money you can borrow ranges from $10,000 to $50,000 and is tied directly to the value of your property. Your credit score, income level, and your boat’s current market value will also affect the amount of money you can borrow.

In most cases, you can borrow the full amount of your boat’s value if it is in your name. However, some lenders may restrict borrowing capacity if the vessel is not in the borrower’s name but they have a lien on it. If this is the case, the loan amount may be reduced by up to 25%, or it may not be available.

Boat title loans are often unsecured loans for personal and recreational use. The riskier nature of unsecured loans gives borrowers access to higher amounts with lower interest rates than secured loans. However, because boat title loans are unsecured, some lenders may refuse to issue them for high-value vessels.

How to Apply for Your Boat Title Loan

To apply for a boat title loan, you must decide if you are interested in a secured or unsecured loan. Secured loans have the advantage of having collateral protection that can use against default. You will also need to prepare and send in the appropriate documentation to get your loan approved.

If you are applying for an unsecured loan, you will most likely begin by filling out an application form. Once your lender has verified your income and other information on the document, it will be processed within one business day. Your lender then needs a signed agreement before issuing a title loan. If you have a lien against your boat, there may be additional forms that you must fill out. These are typically used to obtain the funds to remove the lien and pay off the loan.

Borrowers must also fill out a third-party authorization form, often called a UCC-1 filing. It is similar to an affidavit, but it is required for your lender to purchase insurance on your boat. Lenders generally use this document as collateral when they issue boat title loans. As mentioned above, it is worth shopping for the best deal before applying for a boat title loan because competitive rates can save you thousands of dollars or more over time.

Documents and Forms That You Will Need to Fill Out

You may be required to submit additional documents as part of your application process. These documents include:

• The original title of your boat.
• Your current vehicle title and registration, if you own a car registered in your name.
• A signed loan agreement. Your lender will provide this after applying for a boat title loan. It is worth noting that some lenders may require you to sign the loan agreement before submitting the application form.
• Proof of income from a third-party source, such as a W2 or 1099.
• Proof of property ownership, such as tax returns or a deed showing ownership interest in real estate.
• Proof of any other vehicles or property you own in your name.
• A signed statement from all other registered owners stating that they know the loan’s terms and conditions.

If you have a lien against your boat: 

• An application for title release 
• A copy of the contract for sale or other document listing the agreed purchase price 
• A statement shows that you have another type of collateral with real value. 
• Proof of ownership and registration for this asset. 
• A signed letter from the creditor stating that they agree to cancel the lien.

In addition to these documents, most lenders will require applicants to provide proof of their income, often along with recent pay stubs and tax returns.