Author: Atlantic Horizon Capital Staff

How Do I Know How Much Airplane I Can Afford?

Owning a private plane gives you a sense of freedom and independence to go wherever you want, whenever you want. It’s the best way to see the world and conduct business. Yet, before a financial institution is comfortable giving you a loan for a private aircraft, they will first seek to understand whether you have the finances to cover the loan payments and operating costs of the aircraft. How do you know how much airplane you can afford? Let’s go over some of the factors that determine which type of aircraft you should purchase.

The Cost of a Private Jet and Other Aircraft

The main question to consider is: how much income is required to make the purchase? In 2011, President Obama created a stir when he said that someone making around $250,000 a year could own, operate, and charter their own private jet. That is not true. Even without factoring in inflation, the cost of buying a small aircraft or jet and operating it is a far greater investment.

On average, a used jet costs between $200,000 and $500,000, though some may be $2 million or greater. That being said, you most likely want a brand new aircraft—one fitted with the latest technology and comforts. In today’s market, most jets cost within the range of $5 million to $30 million, though models can fall outside of this range. According to the 2022 Aircraft Bluebook, the 2022 Gulfstream G700 starts at $78 million. If you were hoping to purchase your own version of AirForce One, you would need $660 million.

Download Gulfstream’s G700 Brochure

To better estimate your budget, take a look at the costs of an aircraft based on passenger size.

Domestic Light Jets (Up to 6 Passengers)

Convenient and cost-effective, light jets are used for those short trips between New York and Chicago or London and Paris. Light jets also make the weekend trip to the Caribbean all the more pleasurable.

Examples include:

HondaJet Elite S – $5.4 million
Cessna Citation M2 Gen 2 – $5.85 million
Embraer Phenom 100 – $4.5 million

Domestic Midsize Jets (Up to 12 Passengers)

Midsize jets offer many of the same comforts as heavy jets but lack some versatility. These aircrafts are ideal for transcontinental flights or day trips for business.

Examples include:

Cessna Citation XLS Gen 2 – $15.5 million
Embraer Legacy 450/500 – Pre-owned costs around $16.2 million
Embraer Praetor 500/600 – New ranges between $16.9 million to $21 million

International Heavy Jets (Up to 19 Passengers)

Heavy jets offer everything you need in terms of space for people and cargo. These aircrafts have excellent versatility when it comes to comfort, size, and range.

Examples include:

Dassault Falcon 7X – $37 million to $58 million, depending on the year
Bombardier Global 7500 – $75 million
Gulfstream G550 – $15.5 million for the 2003 model and $41 million for the 2020 model

Other Variable Fees That Increase The Cost

Aircraft cost aside, next you must factor in the operating costs such as fuel, hangar space, insurance, administrative fees, pilot and flight crew. Let’s say you have a double-engine private jet that operates around 200 hours per year. You could end up paying over $1 million per year to use your aircraft.

There are also unforeseen repairs, such as blown tires which cost around $2,000-$3,000 to replace.

Putting Together the Financing

When it comes to purchasing and owning a private aircraft, the main goal is that you enjoy it. Consider the purpose of the jet. Do you plan on long international flights that take you from the US to Tokyo in a day? Will you need more than a pilot and a couple of crew members to operate the plane? What features in the vessel itself would you need to make it a worthy investment?

There are many different aircrafts to choose from, and so it is important to weigh the costs of the models that interest you with their initial price tag, depreciation, and operating costs.

One of the best ways to ensure that you always have the finances available for operating costs is to secure a loan. Getting a loan for an aircraft is similar to how you would obtain a loan for a home or a yacht, as you can choose between asset-based aircraft loans and credit-based loans.

The financial institution that you choose for your aircraft loan will consider several factors to come up with a monthly payment, including:

Credit score
Debt-to-income ratio
Down payment
Interest rate
Estimated hours per year of use
Make, model and condition of the plane

Offsetting The Cost With Chartering

If you would like to offset some of the operating costs to make owning a slightly larger private jet more affordable, you may consider chartering your aircraft to others whenever you are not using it. To charter a private jet costs roughly $1,300 to $3,000 an hour for an executive light jet; $3,000 to $5,500 an hour for a domestic mid-size or super medium jet; and $6,000 to $11,000 an hour for a heavy jet.

To put that into perspective, a round trip flight on a light jet from New York to Orlando will cost at least $20,000. As such, this is an excellent way to recoup some of the operating costs and pay down your loan without diminishing your enjoyment of your private craft.

Looking For a Flexible Aircraft Loan?

Determining how much of an airplane you can afford comes down to the overall cost of the craft, including the operating fees, and the loan that you secure. As such, your budget and creditworthiness plays a role in what you can and cannot afford. You have the option to make private jet ownership even more affordable by chartering it whenever you are not using the aircraft.

At Atlantic Horizon Capital, we offer flexible loan options to make owning the private jet of your dreams easier than ever. Whether you hope to own a brand-new plane or upgrade to the latest model, our team can help you find the best loan to suit your unique needs. Apply for your aircraft loan today or contact us with your questions.

Boat Loans: The Pros and Cons to Keep in Mind

Among the things you should do when looking to get a boat loan is to consider the pros and cons of this kind of financial commitment.

Here are some pros of getting a boat loan:

Flexibility. Boat loans offer flexibility in terms of loan terms, interest rates, and payment schedules, so you can choose the loan that best fits your budget and needs. You also have a choice of different lending institutions.

Access to funds. Rather than saving up a large sum of money to pay for a boat in full, you can instead use a boat loan to spread payments out over a specified term. This makes boat ownership more accessible and affordable.

Low-interest rates for those with good financial history and credit. If you have good credit and a solid financial history, you may be able to secure a boat loan with a low-interest rate, making it more affordable to finance your boat purchase.

Possible tax benefits. For some borrowers, the interest paid on a boat loan may be tax-deductible, providing a financial benefit.

Here are the cons of getting a boat loan:

Another debt to repay. If you take out a boat loan, you now have another financial obligation. Be sure you have considered your budget before signing the paperwork.

Interest rates. Boat loans, like many other loans, have interest. Unless you pay off the loan rapidly, those interest rates are going to add more to the overall cost of the boat.

You may be required to provide a sizeable down payment. Some boat loans may require a down payment, which can be a significant upfront cost that you’ll need to budget for. The down payment may be larger for those with less than stellar credit.

Risk of repossession. If you’re unable to make payments on your boat loan, the lender may repossess the boat to recoup their losses, leaving you without the boat and still owing money on the loan.

Depreciation. Boats lose their value over the years, meaning that your boat may eventually be worth less than what you owe on it.

Are There Any Alternatives to Boat Loans?

Having gone through the dos and don’ts of boat loans, you may be wondering if there are other ways to purchase a boat that doesn’t require a loan. There are some alternatives to consider:

Personal loans. If your credit is decent, you may be able to apply for a personal loan to finance your yacht purchase. On the downside, personal loans have a higher interest rate than secured loans, but you do not risk repossession, since no collateral is required. Plus, personal loans offer flexibility when it comes to repayment schedules.

Boat leases. Some boat dealers may offer lease options for boats, allowing you to use the yacht for a set period of time and then return it to the dealer at the end of the lease term. Lease options may be a good choice for those who want to use a boat for a short period of time or who are unsure if they want to commit to owning a boat long-term.

Cash payment. For those who have enough money to pay for a boat outright, a full cash payment may be the most suitable option. Again, you must consider the financial burden this could cause.

Home equity loans. If you own a home, you may be able to borrow against that equity. Home equity loans typically have lower interest rates than personal loans, but they require you to use your home as collateral.

Looking for a Flexible Boat Loan?

Now that you understand the dos and don’ts of boat loans, remember that most of the process is in the preparation. Make sure you have everything in order, including your credit score and history, employment, budget, and debt-to-income ratio. Avoid anything that may change your ability to handle any financial changes, and never sign a loan document before reviewing the fine print. Atlantic Horizon Capital has plenty of boat loan options for aspiring boat owners. Our experienced team can help you acquire a boat loan and have you sailing the high seas on your new vessel in no time. Contact us today or start filling out your boat loan application.

The Dos and Don’ts of Boat Loans

So you want to be a boat or yacht owner? That’s great! You will find that when you get behind the helm, a whole new world of opportunity and fun opens up to you. Yet, before you cast off and begin your voyage, you will need to make the purchase. Since boats can be a tremendously expensive investment, you may be considering a boat loan to make the process more affordable and flexible. That said, securing a boat loan can be challenging, especially if you are unaware of how everything works.

In preparation of your upcoming boat purchase, let’s discuss the dos and don’ts of boat loans.

How Do Boat Loans Work?

Boat loans work in a similar way to other types of loans, such as car loans or personal loans, though boat loans tend to have a longer repayment period.

Typically, your boat loan is going to have a period of 7 to 20 years, though you may get a shorter or longer period depending on several factors such as your credit score, the age of the boat, and the cost of the watercraft. If you want to purchase an expensive yacht, you will often receive a longer loan term to make the monthly payments more affordable. For example, if the yacht is $30 million, you could receive a 20-year loan term (or longer). Conversely, a $500,000 cabin cruiser may only get a 5-10 year loan term.

Once you have compared various lenders and their loans, you need to submit an application to the lender. Applications ask you to provide your income, credit score, employment, and the kind of boat you would like to purchase.

The lender then reviews the application and determines whether you are worthy. If you are approved, they provide you with an offer that includes the loan amount, repayment terms, and interest rate. Keep in mind that shorter loans have lower interest rates, while those that are longer tend to have higher interest.

I think the first paragraph pretty much states this, so let’s cut to try and get the word count down.

Additionally, in most cases, boat loans are secured by the boat itself, meaning that the lender can repossess the boat if you default on the loan. This is similar to how car loans work, where the car itself serves as collateral for the loan.

Overview of Different Kinds of Boat Loans

By understanding the different types of boat loans out there, you can better prepare for the terms of the loan as well as get the one that best suits your needs and budget. Here is an overview of the various boat loans available:

Secured Boat Loans

A secured boat loan is “secured” with collateral that is the boat itself. In other words, the lender holds the title of the boat until you have paid in full. Secured boat loans typically have lower interest rates than unsecured loans, but you may be required to also pay a down payment alongside collateral.

Unsecured Boat Loans

If you do not want to use your boat as collateral, an unsecured boat loan may interest you. With this loan, the lender does not hold the title to the boat. Unsecured boat loans typically have higher interest rates than secured loans.

Fixed-Rated Boat Loans

These loans have a fixed interest rate for the entire loan term, meaning that the borrower’s monthly payment remains the same. Fixed-rate boat loans provide stability and predictability for borrowers. Keep in mind that you can always pay more than your fixed monthly payment. This could help you pay off the loan faster and save you some money in the long run. However, there may be penalties for early or additional payments, so be sure to read the fine print of the boat loan.

Balloon Payment Boat Loans

These loans have a lower monthly payment for the majority of the loan term, but a larger “balloon payment” at the end of the term. Balloon payment loans can be a good option for borrowers who want a lower monthly payment initially, but they can also be more risky if the borrower is unable to make the balloon payment at the end of the term.

Variable-Rate Boat Loans

These loans have an interest rate that can fluctuate over time, depending on market conditions. Variable-rate boat loans can provide lower interest rates initially, but they can also be more risky if interest rates rise significantly. If you have the financial flexibility to make payments that rise and fall, this could be a good option, especially since you could end up paying off your loan much faster than predicted. The disadvantage here is that payments could skyrocket unpredictably, leaving you overwhelmed.

What to Do When Getting a Boat Loan

You found a boat and are excited to sail off into the sunset. Before you can do that, you need to gather up information and required documentation for your boat loan application. Here is a list of things to do when applying for a boat loan:

Do check your credit score. Your credit score is a key factor that lenders use to determine whether to approve your loan application and what interest rate to offer you. Check your credit score before applying for a boat loan and take steps to improve it if necessary. You should also know whether you have late or missing payments, as this could affect the outcome of your application.

Confusing. The boat gets its own loan? I’ve never met a sentient boat.

Do calculate your budget. You do not want to overextend yourself financially. Determine how much you can afford to spend on a boat and what monthly payment you can comfortably make. Remember, you also have to account for maintenance, the marina, and other costs related to boat ownership.

Do consider a down payment. Most lenders will require a certain percentage for your down payment. Making a larger down payment could potentially lower your monthly payments and also reduce the overall cost of the boat.

Do shop around. There are many lenders that offer boat loans, including banks, credit unions, dealerships, and online lenders. Shop around to find the best rates and loan terms, and compare loan offers from multiple lenders before settling on the one that is right for you.

Do ask questions—that’s a must. If something within the loan offer does not make sense, make sure you ask your lender. You should fully understand the loan terms, interest rate, associated fees or charges, and repayment period.

By doing these things, you can increase your chances of getting approved for a boat loan with favorable terms and avoid any financial pitfalls.

What Not to Do When Getting a Boat Loan

Now, what about the don’ts of applying for a boat loan? Here are some things you should avoid doing when trying to get a boat loan:

Don’t overestimate your budget or finances. Biting off more than you chew when it comes to monthly payments can take the wind out of your sails very quickly. Be realistic about what you can afford that won’t overextend yourself financially. Avoid the temptation to take out a loan that is larger than you can comfortably afford to pay back.

Don’t alter anything important, including your debt-to-income ratio. You do not want to change anything that could affect your debt-to-income ratio, including your credit history or employment. For example, if you have been an executive in technology for seven years but want to switch to another industry or take a pay cut to pursue a hobby, don’t—not until you have secured a boat loan. Most lenders want to see at least 2 years of work history for the same employer. Also, avoid over-spending and late payments.

Don’t apply for multiple boat loans at once. Applying for multiple boat loans at the same time can hurt your credit score and make it more difficult to get approved for a loan. Stick to applying for loans from one or two lenders at a time.

Don’t overlook the necessity of maintenance and upkeep on your boat. Although this may not seem like something you need to think about until you get your boat, you should ensure you have a place in your budget to keep your boat in good working condition. Otherwise, you may find yourself too financially stressed to enjoy your new purchase.

By avoiding these common mistakes, you can increase your chances of getting approved for a boat loan with favorable terms and avoid any financial pitfalls.

When Is The Best Time to Buy a Boat?

Timing is everything when it comes to purchasing a boat. In most cases, a boat is a huge investment that typically requires financing. Knowing the best time to buy a boat can help you get the best deal possible as well as better loan terms.

So, when is the best time to buy a boat? Here’s some advice to help you make an informed decision for your upcoming boat purchase.

Make Your Purchase Off-Season

The ideal time to buy a boat is in the off-season. This is typically in the fall and winter months when the weather is colder and boating activities are less frequent.

Spring is usually when dealers are trying to get rid of leftover inventory from the previous year, but you can also do your boat shopping in autumn and winter. During this time, dealerships offer excellent incentives for helping them make room for the newer models coming in. The only downside to this is that the dealership may not have the boat you want in stock. You can certainly get an excellent deal, but the boat may not fully satisfy your wants and needs.

Do your best not to purchase a boat during the summer when boating activities are at their peak. The latest models have just be unveiled, and the price tags on these vessels is at an all-time high. If you want something that has been newly released, it is best to wait until winter or late spring of the following year.

Do You Want a New or Used Boat?

As with anything that comes with a price attached, the principles of supply and demand are highly influential. For example, in 2008, during the recession, boat production dropped. Boat owners looking to trade-in or upgrade their boat had to wait years before the vessel they wanted became available.

The demand for a specific boat model will most definitely impact the price you pay. Even if the boat is used, the number of models available, as well as how many others are searching for it, could elevate the price beyond your budget. The question is whether you want to wait or search for something else.

Fortunately, many used boats hit the market in autumn and winter, when they have been traded-in at the beginning of the year for something newer.

Snag a Deal at a Boat Show

The boat show season typically goes from late winter to early spring, and it’s when manufacturers unveil their newest models. Many boat dealerships and sellers use this time to showcase their inventory, and they may offer incentives and promotions to lure buyers. However, the prices of the latest models are often inflated, so if you’re not set on purchasing the latest model, it may be best to wait until the off-season.

Boat shows also give you the advantage of looking at hundreds of models at once. You can do some market research on competing models, manufacturers, and technology. You may also find that there are lenders at boat shows offering special pre-qualification deals, meaning that there are plenty of options within your budget.

Keep Interest Rates in Mind

If you’re planning to finance your boat purchase, interest rates may fluctuate throughout the year. Interest rates are influenced by the overall economy, and they may increase during peak boating season when demand is high. Therefore, financing your boat purchase during the off-season may result in lower interest rates, saving you money on the overall cost of the boat.

On the other hand, waiting too long to purchase a boat may result in limited inventory, as many boats may have already been sold. If you wait too long, you may miss out on the best deals and dealership incentives.

Open up a conversation with a reputable lender to see if they offer more flexible options throughout the year. That way, you can get the boat you want when you want it.

Finance Your New Boat with Atlantic Horizon Capital

If you are looking to purchase a new boat, the best time to buy it is off-season, which is typically fall or winter, though it depends on your location. During the off-season, boat dealerships and sellers are more motivated to sell boats, and you may find reduced prices, additional incentives, and the opportunity to inspect and survey the vessel before the peak boating season. However, it’s important to keep in mind that waiting too long may result in limited inventory and missed opportunities. Ultimately, the timing of your boat purchase should depend on your specific needs and circumstances.

Looking to finance the boat of your dreams? Atlantic Horizon Capital can make your dream of boat ownership come true. We offer flexible boat loans for a variety of vessels. Apply today or contact our experienced team with your questions.

Questions To Ask When Buying a Boat

Buying a boat is one of those purchases that a person looks forward to for a long time. Not only does it provide a lot of fun, boating can become a way of life for some people. Buying a boat is also an investment. That is why it is important to ask plenty of questions so you can find a boat that fits your specific needs.

1. Why Do I Want A Boat?

Do you like fishing? Zipping over the waves at high speeds? Hearing the snapping of sails in the wind? There are many different types of boats, each one designed for specific things. Before you can get a loan, you need to consider all of your options. Before you do that, you really should think about how you plan on using your boat. This will help to guide your choice as you shop around for the best one. Keep in mind: It’s not necessarily about finding the “best” boat. It’s about finding the boat that fits your needs.

2. Does This Boat Fit My Needs?

As mentioned above, boats are designed with a purpose in mind. If you like fishing, a center console boat is ideal. If you want to stick to the back bays to go water skiing, you do not want to get a 64-foot Viking. Boats made for offshore activities are not the same as ones designed for back bay activities. In other words, it is important to not only think about what you plan on doing with your boat, but also the size and what it was created for.

When speaking with the seller, it is important to be upfront about your needs.

3. Can I Get A Boat Loan?

Most buyers will finance their purchase to some extent, as it is difficult to lay down such a big sum of money at one time. However, before you make a decision, you will need to figure out if you can qualify for a boat loan. Once you have found a boat, take a moment to review your credit history. Any outstanding debt will play a crucial role in your eligibility and the kind of loan you can receive.

Atlantic Horizon Capital can finance most credit situations, but banks are generally looking for a credit score of 680 or higher. In order to get a preferred rate, you need a score of over 740.

4. Are There Other Costs To Owning a Boat?

Yes, there other costs. Keep this in mind when shopping around for a boat. Some of these additional costs, such as fuel, slip fees, storage, and winterization, are minor but do add up over time. Repairs and upgrades may also be necessary. There is also the cost of registering and insuring your boat, which can be pricey. Of course, all of these extra fees are offset by how much fun you will having on your boat!

Conclusion

“Can I get a boat loan?” and “Does this boat fit my needs?” are just some of the more important questions that you ought to ask before buying a boat. A little bit of preparation and forethought can go a long way. When you do find the boat that is right for you, we hope that you will enjoy years of pleasurable marine leisure. Of course, if you want to know a little more, you can always contact Atlantic Horizon Capital to ask questions or to arrange the financing of your new vessel.

What Do I Need to Finance a Boat?

When buying a boat, you will probably find it more practical to finance that purchase to some extent. You generally can’t get the boat without paying something, but a boat loan makes it much easier to get out on the water where you want to be. Indeed, most boat buyers do end up financing their purchase to one degree or another. If you are one of the many people who are considering financing a boat, you might be wondering: What do I need to finance a boat? Let’s try to answer that question as completely as possible.

1. Choose Your Vessel

Before you can finance a boat, you need to figure out what kind of boat you will be getting. It will be impossible for your lender to approve or deny your loan application until they know what you are trying to buy. They need this information so that they can figure out what you are realistically able to afford.

2. A Down Payment

As we said before, you can’t usually just take the boat home without paying something. In most cases, lenders are not willing to finance 100% of the cost. However, most lenders will only require 10%-20% of the purchase price as a down payment. In any case, you need to make sure that you have the down payment ready. 20% is the most common figure, so just take the price of your chosen boat and multiply it by 0.20. For instance, if your boat costs $100,000, your down payment will be $20,000 (20%).

3. A Good Credit History

This is one of the most important things that you will need when asking for any kind of loan. Because boat loans tend to be pretty large, your credit history will be even more important here. This will tell a potential lender how likely you are to repay the debt, thus giving them a way to assess risk. Most lenders will require a credit score of 680 or more.

4. Proof Of Income And Employment

Credit history isn’t the only thing your lender will want to review. They will also need proof of income and employment.

This kind of proof can take many forms, paystubs, W2s, or copies of your Federal Tax Returns. Recent paystubs will verify employment and pay, and W2s and copies of tax returns help verify annual income, especially if you are self-employed.

5. A Low Debt-To-Income Ratio

When evaluating your income and employment, most lenders will be taking notice of your debt-to-income ratio. This is basically just a comparison between all your known debts and all your known income. If your debts are greater than your income, you most likely won’t be approved for that loan.

A high debt-to-income ratio could mean you are living beyond your means. Banks and Creditors like to see a debt ratio of 1.20 or higher. That means for every dollar of loan expense you have $1.20-meaning you can cover the loan payments and still have money left over. Generally, people with a lower debt-to-income pay their bills regularly, and on time, and are generally seen as having a better credit risk than those with a high debt-to-income ratio.

Conclusion

You don’t need all that much to finance a boat, but it can still take time to make everything happen. Apart from the time that your lender takes to review your application, they will also need time to review all of your information and make sure that you fit their requirements. If you need help finding the best lender for you, there is no need to worry. Just contact Atlantic Horizon Capital today to set up a free consultation.

What is a Boat Loan?

If you live anywhere near the water, the idea of having a boat probably sounds great. Even if you don’t like to swim, dive, or fish, there is something relaxing about cruising the waters and enjoying a nice day on the water. Most of us simply cannot afford the high cost of most vessels. Fortunately, boats can be affordable and accessible to everyone, this is where financing your boat purchase is helpful.

How Does A Boat Loan Work?

Boat loans are available through a number of different channels, but specialty lenders are often the better choice as this is a very specialized type of loan. Banks and traditional lenders are fine for car and home equity loans, but boat financing is a little more purpose-specific.

Obviously, there will be an application/evaluation process, as with any other type of loan, which will include a credit check. Before this begins, you will need to decide what sort of boat you want and how much you want to borrow. Then, you will have to provide all the required information and wait for the lender to review that information.

If you are approved for a boat loan, the lender purchases the boat on your behalf. You will probably have to make a down payment, usually 20% of the purchase price. So let’s say your boat costs $100,000: Your down payment would be $20,000 (20%).

Once you sign the loan documents you are responsible for repaying the loan under the terms of the agreement. This will typically be done by using a set monthly payment for the negotiated term. In most cases, while there are no prepayment penalties, you are required to make 6 monthly payments before you can consider paying off your loan in full.

How Much Will I Have To Pay Per Month?

There are several things that will affect your repayment rate. First of all, the lender will consider the size of your loan. If you’re just borrowing a few hundred to buy a canoe, those monthly payments can be quite small. Of course, if you’re buying something larger like a yacht, those monthly payments are going to be much larger.

Secondly, your financial qualifications will also play a role. People with better credit can generally be expected to make payments more reliably. As such, they are considered to be less of a risk and will likely get a better interest rate.

The term of repayment will also be important. When you get a boat loan, you will need to choose the length of the repayment term, usually from 5 to 20 years. If you go with a shorter repayment term, your monthly payment will be larger since you are paying the loan back sooner. If you choose a longer repayment term, your monthly payment is smaller but over time you are paying more interest.

Understanding Interest Rates

The Federal Reserve sets the Interest Rates that they charge banks to borrow money from them and what they can charge other banks to borrow from each other. The Banks themselves set their own Interest Rates for consumers based on several factors including demand, the economy, and risk. This applies to mortgages, car loans, and boat loans. Loans traditionally have been either a fixed rate or variable rate over the term of the loan. For boat loans, the rates are fixed for the term you choose. This allows you to have a fixed payment every month for the term of your loan, which makes your ability to plan for the future easier.

Conclusion

Boat loans are pretty self-explanatory: You get a loan to purchase a boat. The concept is simple but on occasion, the specifics can be difficult for some people.

To summarize the process:

Choose a boat that fits your needs and your financial situation
Choose a Lender
Negotiate the Terms of the loan
Apply for the loan
Make the down payment, close on the loan and take possession of the boat
Make payments until the boat is paid off or sold

The best way to simplify the process is to choose a high-quality lending organization whose employees are there to guide you through the process and to ensure the process goes smoothly and efficiently. To get started with your boat loan, contact Atlantic Horizon Capital through our website or by calling 609-365-1540 and allow us the privilege of helping you secure the boat of your dreams.

The Complete Guide To Financing An Aircraft

As you may already know, aircraft loans are slightly different from other types of loans. Since aircraft are specialty assets, they are subjected to specific laws that many traditional lenders do not understand. There is good news if you are looking to finance your next aircraft purchase. Atlantic Horizon Capital is here to help with our complete guide to financing your aircraft.

The Aircraft Purchase Process

Before applying for a loan, you should know how these transactions differ from other loans. First, the parties will sign a Letter of Intent (LOI) as the buyer places a deposit on the aircraft. The LOI will often contain the basic payment terms and a description of the aircraft. Many parties will use a title company or law firm to act as an escrow agent for the deal.

Remember, many of these sales are purchased on an “as-is” basis. If you are buying an aircraft, it is vital to get an inspection of the asset. Most buyers will arrange an inspection to conduct a mechanical and visual check of the aircraft. If there are any issues with the aircraft, the buyer can request the seller to correct any problems before closing on a sale.

At this time, the escrow agent will search for any lien against the aircraft. If there are any liens, the seller must satisfy them before the sale can proceed. With help from the escrow agent, all the closing documents are prepared and executed.

After that, the parties will attend a closing where the documents are released and filed. Unlike a real estate transaction, these closings are usually handled remotely. Once everything is finalized, the buyer will have possession of the aircraft.

Before you can think about finalizing a deal, you need to find the right financing for your aircraft.

What Are Typical Aircraft Loan Terms?

Certain financial methods are used to qualify borrowers for an aircraft loan. First, you will want to find a reasonable interest rate for your loan. The interest rate will affect the amount of the loan. Most lenders will look at the buyer’s credit score. With these loans, the terms are usually at a fixed-rate basis rather than a variable rate. However, you may still find a variable rate for your aircraft loan.

Down payments are usually required for an aircraft loan. For many business and private aircraft, a typical down payment is around 15%. The lender could reduce the down payment to 10% if you have exceptional credit. The down payment requirement could increase to 30% for those with poor credit. The down payment can even affect your terms. A higher down payment will usually give you a longer term on your loan.

Many times, the amortization period and terms are different lengths. In some situations, balloon payments may be required after a specific time. For example, an aircraft loan with a 20-year term could require a balloon payment after five years. Many newer aircraft will have terms up to 20 years, while older planes may only have loans with 10 to 15-year terms.

As you imagine, all those factors can affect the monthly payment. These loans are similar to a home mortgage. Most of the interest will be paid upfront, meaning you will not gain much equity during the first years. Some loans do not have prepayment penalties, which means you can pay off the loan without any fees.

What Can Affect Your Aircraft Loan and Purchase Price?

The type of aircraft will make a difference in the terms. Some older aircraft do not qualify for the best rates, but those newer models can find the ideal terms. The purchase price is another factor that can directly influence the type of financing. Some loans can be spread out over several years, helping to lower your monthly payments.

Along with that, the installed equipment can affect your terms. The age, quality, and type of installed equipment will influence the purchase price. New avionics could boost the price even if you purchase an older aircraft. On the other hand, outdated and older equipment could lower the aircraft’s price since they will have higher maintenance costs.

All aircraft will have records that show responsiveness to the FAA’s Airworthiness Directives. Also, there should be complete maintenance records for the asset. You will want to examine the craft’s airworthiness certificate, equipment lists, airframe and engine logbooks, flight manual, and weight and balance data. If anything is missing, it needs to be reflected in the sale price of the aircraft.

Finally, the damage history will affect the price of the aircraft. You will want to review the type of incidents and accidents associated with the plane, repair details, and whether there is any major impact on the components. Any pre-purchase inspection will take a close look at the history of the craft to ensure it conforms to all FAA practices and regulations.

The Approval Time and Terms of Aircraft Loans

Many people are accustomed to closing on a car loan in a few hours. That is not the case with an aircraft loan. In many instances, it could take at least a few days to finalize a simple loan. Expect more time to process the loan if you have complex financing terms. Typically, the longest financing term for an aircraft loan is 20 years, but you may only finance older aircraft for 10 years.

Credit Scores and Aircraft Loans

Like most types of loans, the credit score is extremely important. The credit score shows that you will make the payments on time and can help you get a lower interest rate.

Understand the Basics of an Aircraft Loan

Now that you understand these loans better, you can find a provider to give you the best rate and terms. Aircraft loans are different from other loans, and you will want to work with an experienced company to help you choose the right financing option for your next purchase. Contact Atlantic Horizon Capital today if you are ready to apply for an aircraft loan.

The Complete Guide to Financing An RV

Now that you are ready to purchase an RV, you need to understand how to finance the vehicle. You might think they are similar to car or truck loans, but they are slightly different. You can finance through the dealership, but you will not get the best terms or rates. Atlantic Horizon Capital has created this guide to help you make the right financing decision for your RV.

Types of RV Loans

There are two types of loans for an RV: secured or personal. A secured loan will use the RV as collateral to guarantee the loan. The lender can repossess the vehicle if you cannot make those monthly payments. With these terms, the lender has some guarantees about the loan. In many cases, if you have good credit, then you can expect a lower interest rate.

A personal loan is not backed by any type of collateral. However, these loans are riskier for traditional banks and lenders. For that reason, online lenders typically offer these loans. In some cases, the interest rates are higher. While that may be a problem for some borrowers, you can still secure a great rate for your RV loan with the right lender.

Can you buy an RV with an auto loan? If you want to buy an RV with these types of loans, you need to think again. Since recreational vehicles are more expensive than cars or trucks, you will need a larger loan. RV loans have a more in-depth underwriting process than standard vehicle loans. Additionally, lenders will look at other factors for the loan, such as net worth, cash flow, and liquidity. In many situations, these factors are not considered with an auto loan.

Who Offers These Loans?

As previously mentioned, you do not need financing from a dealership. You can find online lenders, credit unions, or banks for these loans. Banks and credit unions will offer secured loans, while online lenders specialize in personal loans. Online lenders can provide you with faster funding, but some traditional loans could be a better option to secure a lower rate.

Interest terms can vary. You may get an interest rate of 4% if you have good credit. Sometimes, you may be expected to pay interest rates as high as 17% with poor credit. Generally, most RV interest rates fall into the 4% to 10% range.

Speaking of credit scores, many lenders will require the borrower to have a score of at least 690. Keep in mind that these requirements can vary depending on your lender. Other factors will determine your RV loan’s terms and interest rates, including your debt-to-income ratio, employment history, and income.

Down Payment for an RV Loan

The total down payment percentage is based on the RV’s selling price before the title, tax, license, and loan processing fees. The amount of the down payment will vary from lender to lender. Typically, you can expect to put down at least 10% of the vehicle purchase price for a down payment.

Like buying a car, a new RV will depreciate as much as 20% when it leaves the dealership’s lot. With a long-term loan, you could owe more than it is worth. For that reason, you will want to make a bigger down payment on your next RV purchase.

Many of these RV loans have longer terms than a typical car loan. Since the price of a new or used vehicle is higher, many buyers can get longer terms to make the payment more affordable. Generally, the average RV loan will range from 10 to 15 years, but some lenders can even extend these terms for 20 years or more. Like any type of loan, if you can get terms for two to five years, you will pay less interest for the life of the loan.

RV Loans and Insurance

Many times, lenders will require proof of insurance to release the loan. However, some lenders will waive these requirements. You can get a loan without insurance, but it is essential to carry full coverage insurance. In the event of an accident or loss, the insurance company will reimburse you. In many states, it is a requirement for the vehicle to be insured. Always check with your local laws to see what is needed to drive your vehicle down the street safely and legally.

Titles, Registration, Taxes, and Loan Processing Fees

If you want to finance your title, taxes, registration, and loan processing fees, it is possible with some lenders. Financing these fees must meet your lender’s loan-to-value (LTV) guidelines. While most lenders prefer that you pay for these fees out of pocket, they are willing to help finance these costs.

The Next Steps

Knowing the basics of RV financing allows you to find the best rate for your needs. RV loans can be complicated to understand, but with the right amount of research, you can finance that next big purchase. One of the biggest challenges is knowing what you can afford. Most lenders recommend keeping the RV loan to less than 25% of your income. Without knowing your budget, you could be stuck making big payments for many years to come.

Along with financing, there are other costs associated with RVs. Always think about maintenance. RVs will have plenty of ongoing costs after the initial purchase. Plus, insurance rates can be higher for those vehicles. You will want to consider those factors when it comes time to purchase and finance your vehicle. All these costs can add up when you are buying an RV.

There are many ways to finance your next RV purchase. Usually, these loans have higher requirements for approval than a standard auto loan. You will want to work with a lender that specializes in these types of loans and can get you an excellent rate for your vehicle. At Atlantic Horizon Capital, we offer personal loans so that you can make these purchases. If you would like to learn more information about our RV loans, reach out to us.

The Complete Guide To Financing A Yacht

A yacht is one of the greatest status symbols that a person can own. At the same time, it can also provide a lot of fun for you and yours. However, even those who are relatively wealthy will likely find it more convenient to finance such a large purchase. This allows you to spread the expense out over time, making it easier to handle. In this article, we will attempt to tell you everything you need to know about financing a yacht.

Step 1: Choose A Yacht

When you apply for a boat loan, you will be applying for a specific boat purchase. That means you need to start by picking the yacht that is right for you. Obviously, you should look for something that fits your finances.

To do that, start by deciding how much you can afford to pay each month. Once you know that, you can contact your lender and ask them to give you a rough idea of how much you can afford. Once you have figured out your price range, simply choose the one you prefer from those within your price range. Bear in mind that there will also be storage costs, which will likely add to your monthly expense.

Step 2: Apply For The Loan

Now that you know the cost of your boat, bear in mind that you will need to make a down payment. Your lender probably won’t cover the entire cost. Typically, you’ll be looking at 10%-20% of the purchase price. So, make sure you have that sum on hand.

Contact your lender and let them know you wish to apply for a loan. They will guide you through the steps that need to be taken next. However, we can already tell you that they will want to identify you in person with a state-issued ID. They will also want a large amount of personal information, particularly financial information.

Having recent tax information on hand is a good idea, and you will definitely have to provide them with proof of your income and employment. They will also want all kinds of information about the yacht that you intend to purchase, so have that ready as well.

Step 3: Negotiate The Terms Of The Loan

Once you have been approved, you will need to figure out the exact terms of this loan. By this point, you should already know how much you need to borrow. You should also know roughly how much you can afford to pay each month. However, there are still some matters that need to be settled. While considering these things, you can use this handy loan calculator to juggle numbers and see how they work for you.

There are two basic types of boat loans: Secured and unsecured. A secured loan is guaranteed with a collateral agreement. That’s a fancy way of saying that they will repossess the boat if you default on the payments. An unsecured loan does not allow the lender to repossess any of your assets, but they can still seek damages in court. In most cases, you will have a better chance of getting a secured loan.

The term of the loan will also matter significantly. Boat loans normally have a term of 5-20 years. For a yacht, you are probably going to want a long-term loan. However, be aware that a longer loan will increase the total amount of interest that you have to pay. A shorter repayment term will mean a larger monthly bill, but less interest overall.

On the subject of interest, that also needs to be considered. You need to know the difference between a fixed-rate plan and a variable-rate plan. Interest rates are set by the Federal Reserve bank, and they change periodically. Thus, you might agree to a loan under a certain interest rate, only for the interest rate to increase or decrease at a later time. If you don’t want to take that chance, ask for a fixed interest rate. With a fixed interest rate plan, your total interest will remain at its original rate regardless of the federal rate.

Step 4: Get The Boat And Pay The Debt

From here, the rest is pretty simple. You pay the down payment, your lender pays the rest, and you take possession of the yacht. You will then be responsible for making a monthly payment until the entirety of the loan is repaid. At that point, your debt is cleared and the yacht belongs to you. Of course, it’s nice that you can still use it in the meantime.

As a new yacht owner, you will also need to consider storage costs. You should have already thought about this to some extent, as you obviously need a place to store your yacht. That usually means renting a spot at a local marina, or some other private storage facility. Of course, if you own waterfront property, you might want to build a dock instead. Either way, make sure you have provided for proper storage of your new boat.

A Word About The Current Market

It is worth noting that yacht demand is at an all-time high. While the exact reasons are debatable, the consequences are not. In many cases, you might have to wait awhile in order to get the model of yacht that you want. At this point, demand for these vessels tends to be greater than the supply, so be aware that waiting lists are common practice.

Conclusion

Although we have tried to cover all the important topics, we would urge you to do your own research as well. After all, we are talking about a very large purchase, and it makes sense to educate yourself beforehand. When you are ready to make that big move and get started, you can contact Atlantic Horizon Capital to find out more. As a trusted and high-quality lender, AHC has an excellent record in terms of customer satisfaction.