Greetings boaters! We are experiencing new ground in the recreational market place as we start the New Year. Financial markets are still unsure to say the least.

Although mortgage rates have fallen into the high 4 to low 5% range and the expectation of recreational boat loan rates to be in the same range is somewhat of misconception. In reality, recreational boat loan rates have always been priced 1-2% higher than the mortgage market which is driven by the long term bond market. There have been times recently where an inverted interest rate curve caused that gap to narrow, but it is not normal. Interest rates are 5.75% to 7.25% depending on the age of boat and amount borrowed, well below the 20 yr. average! It is still a good time to buy if one is in the market. Sellers are willing to negotiate, and savings on purchases far outweigh what may be perceived as higher than expected rates in comparison to what was available a few years ago.

The lending landscape has changed in recent months as several longtime marine and RV lenders have exited the business. The likelihood of further attrition is expected before we see stabilization. Remaining lenders have been returning to the more conservative lending philosophy of 15 years ago. A move “Back to The Basics” of larger down payments in the 15-20% range, good liquidity, and tighter debt ratio guidelines particularly on larger loan requests can be expected.

That being said, Marine Banking Services and its’ lending partners still have attractive loan funding available for qualified borrowers. We continue working to add new funding partners in the near future, that will offer loan rate pricing based upon individual borrower financial profiles. We remain committed to delivering the most competitive and varied loan offerings in the market place to fit your particular purchase needs.

Although these are volatile times wrought with uncertainty, I am confident as things play out over the course of this year, we will begin to see stabilization in the markets and hopefully world tensions. As this happens, the money markets will also begin to stabilize.  If you are contemplating a large boat or RV purchase and are in a cash liquid position to make that purchase, the timing could not be better. It is a buyer's market. Sellers are willing to negotiate.