Buying your first boat is exciting — but it's also a big financial commitment. Before you get swept up in dreams of weekends on the water, let's make sure you understand how boat finance works.
How Boat Finance Works
Boat finance is similar to car finance:
- You borrow money to buy the boat
- The boat is used as security for the loan
- You repay over time with interest (usually 1-7 years)
- Once paid off, the boat is fully yours
You can typically finance the boat, motor, and trailer as a package — most lenders prefer this as it's simpler and the package holds value better than components sold separately.
What Can You Afford?
Before falling in love with a boat, figure out your budget. Consider:
Purchase Price
How much can you borrow? This depends on your income, existing debts, and credit history. Get pre-approved to know your limit before you shop.
Deposit
A deposit isn't always required, but putting money down can:
- Get you a better interest rate
- Reduce your repayments
- Mean you owe less than the boat's worth (avoiding negative equity)
Repayments
Make sure the repayments fit comfortably in your budget. Remember, a boat that sits unused because you can't afford fuel isn't much fun.
Running Costs
First-time buyers often underestimate ongoing costs:
Annual Running Costs (Estimate)
- Registration: $100 - $300
- Insurance: $300 - $1,500+
- Servicing: $300 - $1,000+
- Fuel: Varies wildly based on use
- Storage: Free (at home) to $5,000+ (marina berth)
- Safety gear: $200 - $500 to maintain/replace
- Antifoul/maintenance: $500 - $2,000 (if kept in water)
Rule of thumb: Budget 10-15% of the boat's value annually for running costs.
New vs Used for First Boats
New Boats
Pros: Warranty, latest features, no hidden problems, easier to finance
Cons: Higher price, significant depreciation in first few years
Used Boats
Pros: Lower price, depreciation already absorbed, often includes extras
Cons: Unknown history, potential hidden problems, may be harder to finance if older
For first-time buyers: A quality used boat is often the smart choice. You can learn what you like (and don't like) without the hit of new-boat depreciation. Then upgrade later once you know exactly what you want.
What to Look for in Your First Boat
Match the Boat to Your Plans
- Where will you use it? Rivers, bays, offshore?
- What activities? Fishing, skiing, cruising, diving?
- How many people? Just you, family, mates?
- Towing vehicle? Make sure your car can tow it
- Storage? Will it fit in your garage/driveway?
Don't Overbuy
It's tempting to buy more boat than you need, but:
- Bigger boats cost more to run
- They need bigger tow vehicles
- Harder to launch/retrieve solo
- More intimidating to learn on
Start with something manageable and upgrade once you have experience.
Getting Finance Approved
To apply for boat finance, you'll typically need:
- ID (licence, passport)
- Proof of income (payslips, tax returns if self-employed)
- Bank statements
- Details of the boat you want to buy
For used boats, lenders may also want:
- Proof of the boat's value
- Details of seller
- Sometimes a marine survey (for older or expensive boats)
Tips for First-Time Boat Buyers
- Get a marine survey on any used boat over $20,000 — it's worth the cost
- Sea trial before you buy — make sure everything works on the water
- Check the trailer — a bad trailer can cost thousands to replace
- Factor in all costs — purchase price is just the start
- Don't rush — the right boat will come along
- Get pre-approved — know your budget before you fall in love
- Consider a boating course — build skills and confidence
The Bottom Line
Your first boat is a learning experience. Focus on something that fits your budget, suits your intended use, and won't break the bank to run. Get it right, and you'll have years of fun on the water.
Ready to take the plunge? Get a boat finance quote and let's get you on the water.
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