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Debt Limit
Debt to Income Ratio
Your debt to income ratio is simply a way of determining how much money is available for your monthly boat payment after all your other recurring debt obligations are met.
Debt Limit
There is generally a debt limit associated with each type of loan, such as a 35% ratio for a high score low risk loan. This qualifying ratio is a guideline. An excellent credit history can help you qualify for a Boat loan even if your debt load is over and above the limit.
Understanding the Qualifying Ratio
Typically boat loans have a qualifying ratios of 35% to 45%.
This number is the maximum percentage of your gross monthly income that can be applied to housing expenses and recurring debt. Recurring debt includes things like car loans, child support, monthly credit card payments and your boat loan.
For example:
With a 35% qualifying ratio:
Gross monthly income of $3,500 x .35 = $1,225 can be applied to recurring debt plus housing expenses
With a 45% qualifying ratio:
Gross monthly income of $3,500 x .45 = $1,575 can be applied to recurring debt plus housing expenses
Remember these are just guidelines. We'd be happy to pre-qualify you to determine how large a boat loan you can afford. We look forward to helping you buy your dream boat.
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