Financing

Marine financing is not a mortgage. Rates are higher, terms are shorter, and the lender is underwriting the boat as much as the buyer. A pre-qual before an offer saves the entire deal from unwinding at week three.

1. Pre-qualification comes first

Any buyer who is not paying cash needs a written pre-qualification before you write an offer. A verbal 'my bank said I'm good' is worthless. The pre-qual should specify amount, boat age limit, and any conditions (survey, engine hours).

2. Who to refer buyers to

• Sterling Associates — sterlingacceptance.com
• Trident Funding — tridentfunding.com
• LH-Finance / La Salle Bank — lh-finance.com
• Essex Credit (Bank of the West) — essexcredit.com
• For yachts $2M+: private banking (JP Morgan, Northern Trust) — refer through Brett.

3. Typical marine loan terms

• Down payment: 15–20% (higher for older or larger vessels)
• Term: 15–20 years for boats over $100k; 10–15 years under
• Age limit: many lenders cap at 25 years old
• Survey required by the lender before funding
• Documented (USCG) vessels are easier to finance than state-only

4. The financing timeline inside a deal

1. 1
   PSA signed

   Buyer submits full application to lender. Broker sends the vessel spec sheet.

2. 2
   Survey scheduled

   Lender orders their own underwriting review in parallel.

3. 3
   Survey accepted

   Buyer sends survey + acceptance to lender. Lender issues commitment letter.

4. 4
   Closing

   Lender wires funds to escrow. Escrow disburses to seller. Title transfers.

5. From the field — New Coast underwriting rules (7/16/26)

New Coast has placed $8B+ in loans across 23 years with a 45-person team; average ticket is around $1M and they run everything from small boats to superyachts. Straightforward deals get a lender response in 1–3 days — complex portfolios (multiple entities, tax returns) take longer.

• PTI (Payment-to-Income): boat payment capped at ~15% of monthly income.
• DTI (Debt-to-Income): total debt capped at ~40%.
• Down payment: lender wants proof of source.
• Cash reserves: 6 months to 5 years of payments, depending on lender.
• Yacht ownership cost is assumed ~10% of vessel value per year — banks want to see the buyer can cash-flow it.
• Current recreational rates: mid-6% range (10-yr Treasury + ~2–2.5% spread).

6. Alternative financing when the bank says no

• Real estate equity (HELOC).
• SBLOC — Securities Backed Line of Credit against a money-market or brokerage account.
• Collateralized loan against CDs.
• For small projects (e.g. $40k engine repower) on a low-value boat: banks won't finance; credit card / personal line is often the practical path.