How long you can finance a houseboat depends on your credit score, the interest rate, the boat's price/condition, and other factors.
Buying a houseboat is a big decision, and not many buyers can pay cash for it. They pay it off over time over the years, like a house or a car. Paying off a houseboat over a long time can make the purchase more affordable, but you do pay more in interest that way.
If you are buying a used boat, you might have to pay it off in only ten years. However, you can finance a newer and more expensive boat for twenty years - as long as a mortgage. If you can afford to pay off a boat faster, you might pay it off over only five years.
Don't overstate what you can afford - you will have to pay to maintain your boat while you are paying for it. The more expensive the boat is, the longer you can finance it. Buying a houseboat can be one of the best decisions you ever make, but it can get you in financial trouble if you aren't careful.
I bought a houseboat ten years ago, and it will be paid off completely in two years. Buying a houseboat is a great choice if you really want it, and you can comfortably afford the downpayment, repairs, and payments. You may have to spend about 10% of the boat's value each year to maintain it.
What Do Houseboats Cost?
Houseboats vary greatly in price. A lot of them cost around $125,000 or $250,000 dollars, cheaper than homes but still a large investment. Some can cost 1.5 million dollars, and someone might sell an old houseboat that is in terrible shape for a few thousand or less than a thousand dollars.
$150,000 is enough to buy an excellent houseboat if you can afford that much. A $150,000 houseboat will have most of the luxury features you want. Air conditioning, central heating, appliances, washer/dryer, four bedrooms, and two bathrooms are common for a houseboat that costs that much.
Often, you can get a tax-deductible loan to finance a houseboat. If your houseboat is your primary or secondary residence, you can deduct the loan from your taxes. Interest rates and down payments are often higher for floating home loans than for house mortgages.
Houseboats Offer a Lot for What They Cost
While houseboats are expensive, they are actually remarkably cheap for what they offer. A houseboat first needs to be a seaworthy vessel with a powerful engine, a strong hull, responsive controls, and navigational equipment. It then needs to have a decent amount of living space.
A good houseboat has reasonably large bedrooms, bathrooms, and outdoor space. It comes with appliances, from washers and dryers to icemakers and kitchen appliances. Some houseboats use full-size appliances; others miniaturize everything to save space.
Houseboats also have to be well-designed to fit a reasonable number of rooms into a small living space. They need ventilation and electrical systems. Considering how much work goes into building a houseboat, it is surprising how inexpensive most houseboats really are.
Is a Houseboat Worth It?
Yes, getting a houseboat is definitely worth it, in my experience. You are more likely to regret not getting the houseboat than getting it. When you finally get a houseboat, you might wonder why you didn't save up for the downpayment years ago.
Life on a houseboat can be very relaxing, whether the houseboat is your main residence or not. Possibly, the slight movement of the water calms your nerves and keeps you from worrying about anything that doesn't immediately threaten you.
Being near the sea also makes you feel better because being near water naturally makes you feel good. Humans evolved to like water. Being near the water all the time can make you more creative as well as calmer.
What Kind of a Houseboat Should You Buy?
You might want to buy a houseboat because you love boating so much you want to combine your home life with being out on the water. What kind of a houseboat you should buy depends on what kind of a lifestyle you plan on having.
Some people live on houseboats; other people only use them for vacations. If your houseboat is your home, you might need some comforts that you wouldn't care about on vacations. If you plan to bring a lot of people on your houseboat, it can't be tiny.
Owning a houseboat is also a way to make a lot of new friends at any age. You will meet many other people that are into boating, travel, and adventure.
Personal Loans
Personal loans aren't always the best idea because they often have higher interest rates than other forms of financing. However, you can use a personal loan to buy whatever you want, including a houseboat.
A personal loan should not be your first choice. You will lose thousands of dollars if you pay more interest than you could have. However, a personal loan can work as a second choice if other forms of financing are not available and you can afford the interest.
Personal loans are often unsecured, so you do not need a house, a car, a lot of savings, or anything else to use as collateral. However, you do have to have a great credit score to get a large personal loan. It is not the best choice for very many people.
Marine Loan Brokers
Some loan brokers specialize in lending money to people who are buying boats, including houseboats. If you have never bought a houseboat or any boat before, a marine loan broker can make everything much easier.
They can find you a seller and negotiate a deal that you can afford. You might get a significantly better deal through a broker than if you negotiate everything yourself.
Are Boat Loan Brokers Expensive?
Yes, these brokers are expensive. They may charge you 10% of the boat's price, easily several thousand dollars.
If you believe you can get a good deal yourself, you might save money by not paying a broker. You usually have to pay a large downpayment on boats from marine brokers, around 10% or 20%. However, this can be better than the difficulty of finding a good deal yourself.
Getting a Loan
Once you are sure that you really want a houseboat and can afford it, you should make a plan. Have a certain amount of time in mind. If you aren't sure when you want to get a houseboat, it might remain a dream forever.
Is Your Credit Good?
One of the first steps is to find out what your credit score is and a little about whether that is enough to buy a houseboat. Your income matters as much as your credit score does. Possibly, you might have to talk to a company that can help you improve your credit score first.
Investigate the market. What deals are available? What size of a loan is a lender likely to give you with your credit score and your income?
It might not be possible to finance an inexpensive or used houseboat for a long time. Cheaper houseboats usually have to be paid off in a reasonably short time. Usually, you can only finance a houseboat for 20 years if you buy something more expensive.
You May Need to Save Money
If you don't already have a lot of money saved, you may need to put money away every month for some time. A downpayment can easily be 20% of the total price of a houseboat.
Sometimes, you might even have to pay 35%, though you might find a much better deal. If your financial situation/history is better, you might be offered a deal with a smaller downpayment. As is the case for auto loans, people with better credit get smaller downpayments and lower interest rates.
Is a Used Houseboat a Good Idea?
Buying a used houseboat is like buying a used car - you might save a lot of money, but you might also buy something with too many problems. Sometimes, you will be glad you bought used; other times, your houseboat will need expensive repairs often.
If you buy a houseboat used, make sure you find as much about it as possible first. The less information there is, the more likely there is something wrong with the boat that the seller might want you to overlook.
Personally, I did quite well with a somewhat used boat. However, there are bad deals out there. You should take a good, careful look at the used houseboat before you buy it.
Inspecting a Used Houseboat
Anyone who is buying a house will always hire a professional inspector to examine everything. If you are buying a used houseboat, make sure you get a professional houseboat inspector. The inspector might notice something wrong with the boat that you would have missed.
If you are inspecting the boat yourself, look at everything carefully and in detail. Inspect the plumbing, electrical, engine, hull, and deck to make sure that everything works before you buy anything. Some things to try if you inspect the boat yourself are:
- Make sure everything works. Turn every light on and off, test every faucet, try every appliance, and make sure the power outlets work properly.
- See whether or not the boat has been taken care of properly. If the owners didn't take care of the rooms inside the boat, they might also not have maintained it in other ways. Don't get stuck paying for expensive repairs that the previous owners didn't want to make.
- Take the motorized houseboat for a test drive. Make sure that the motors and propeller work. Evaluate how old the equipment is - how long will it take before you have to replace it, and how much will that cost?
- You might not buy a boat that is older and has never had any equipment replaced. If you do, factor the age of the equipment into the cost of the boat. Think about what the boat will cost you in total over the next 10 or 20 or more years, not only what your loan payments will be.
Get Insurance Before You Buy Your Boat
Insurance companies usually prefer to send their own inspectors to look at houseboats. At worst, your best insurance company might refuse to insure your boat after you buy it. They prefer to make an insurance deal before you buy.
Are Houseboats Good for Retired People?
Houseboats are great for people of all ages, including older people and retired people. A lot of people who buy houseboats are newly retired. Houseboat life can be reasonably cheap - it may cost only $6000 per year to live on a houseboat.
While a houseboat might be small compared to a house (e.g., only 500 square feet), you might not need a lot of space if your kids are long gone. If you want to travel a lot during your retirement, a motorized houseboat can make this fun and affordable. There won't be space for a huge number of possessions, but that can simplify your life.
Are Houseboats for All Retirees?
If you like boats, you will probably love living on the water. People who get seasick easily shouldn't live on a houseboat, but if you are considering buying a houseboat, you probably know better.
You should be reasonably healthy if you want to live on a houseboat. If you take medications that make you drowsy, fall easily, or sunburn very easily, a houseboat might not be right for you.
Usually, a houseboat is great for people who want to have many fun, active years after they stop working. You can meet people at the marina and travel wherever you want as soon as you decide to do this, without needing a plan.
Houseboats VS Floating Homes
Floating homes are bigger, more expensive, and not mobile. Houseboats are more mobile and cheaper but less spacious. With a motorized houseboat, you can take it wherever you want as easily as with any other boat.
Floating homes are permanently attached to a dock, so they are not anything like houseboats. Some people are very happy with their floating homes, but they are not for the same people that want houseboats.
Floating homes are large, expensive, connected to sewers like regular homes, and not for people who want to travel around and take their home with them. Floating homes keep their value for much longer than houseboats do.
You Can Stay in the Same Spot With a Houseboat
You won't have to repeatedly leave a marina and go somewhere else with a houseboat. If you prefer to, you can usually stay at the same spot for years or even decades. A marina appreciates your business and usually won't increase your rent or tell you to leave.
Are Houseboats Really Cheaper than Houses On Land?
Yes, houseboats are cheaper than regular houses. While maintenance costs can be fairly high, regular houses can also require expensive maintenance. You do not have to pay land taxes on a houseboat, and houseboats cost much less than most houses.
If you choose to go through with your purchase and live a houseboat lifestyle, make sure you choose a good location. In some places, the weather is frequently poor and not good for people with houseboats. In other places, the weather is great, and you can enjoy living on a houseboat the whole year-round.
