Industry Partners


What do lenders evaluate for boat and RV Loans?

You’ll always be asked about your credit score, and usually, there’s a target number that some lenders like to see. Though, it’s still possible to obtain a boat or RV loan even without meeting some lenders’ standards. Interest rates might be a little higher, but the loan can still get done if you’re working with the right specialist. 

If you’ve been through any loan process before, you know that you have to meet specific criteria for lenders to approve your loan with a decent interest rate. Recreational loans are no different. 

Lenders will also want to know how much money you will be using for a down payment. Most lenders will require about 10% down, but we have personally seen loans get approved with 0% down.

You’re probably very familiar with those indicators. But, boat and RV loans can be slightly different from your average auto or home loan. There might be some more requirements that you may not have had to worry about before. So, what are those other indicators that lenders like to see?

Lenders will want to look at your trade lines. They will not just look at the number but also what your highest trade line is. They like to see that you have a history of making payments on several different loans. Reliability is a big gauge for lenders’ decisions. Ultimately, sourcing a loan is a risk for them, and they want to reduce that risk. So, when they see that you are reliable, they are more likely to approve a loan.

Lenders also like to look at your debt-to-income, or DTI. DTI is a common reason for loan applications being declined, even when the applicant has a good credit score. Debt-to-income is basically monthly debt payments divided by your gross monthly income. The more debt you have or, the less income you have, the higher the ratio will be. The lower the ratio, the better off you are. This is also a case of risk management for the banks. If they think you have too much debt already, they’re not very fond of giving you more.

The common theme here is risk. When you receive your approval from a lender, you might notice that the interest rate is higher than when you bought your car or your home. The reason for this basically boils down to the fact that a boat or RV is a higher risk for a lender than a home or car. Even if you routinely make all of your payments, lenders know that your boat or RV will not take precedence over food, shelter, or your home if you fall on hard times.

Sometimes, lenders can leave you in the dark regarding what they’re evaluating. By knowing which factors lenders use to evaluate your credit profile, you’re able to take the necessary steps in addressing any red flags in your profile and improve your chances of obtaining an approval. For more tips and tricks, please click here. When you’re ready to apply for a loan, please visit and apply!

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