Tracking Boat Loan Interest Trends

If you are looking to buy a boat or own already own one, tracking boat loan interest trends can help you decide the best time to buy, or refinance your loan.

Each bank or lender sets its own boat loan interest rates, but all of them are based on the interest rate set by a team of twelve bankers called the Federal Reserve.  The Federal Reserve's interest rate is not strictly for boat loans -- the rate they set affects the interest rate for all loans.  So you can use this information to watch your interest rates for boat loans, but also for car loans or home loans as well.

What Information Should I Watch and Why?

Most newspapers carry articles on our government agencies' monthly reports on various economic statistics. The statistics which affect boat loan interest rates the most are the "Gross Domestic Product," or GDP, which measures the amount of goods or services produced in the United States; the "Consumer Price Index," or CPI, which measures the average price for different items; and national payroll and unemployment rates.

Pay attention to how these figures rise or fall each month.  A larger-than-average increase or decrease indicates an overall economic trend which could affect future boat loan interest rates.  Increases in most of these figures mean the economy is heading towards a state of inflation.  During an inflation, the government usually steps in to raise interest rates, in an effort to slow down the economic growth and bring inflation back under control.  On the other hand, if these figures are falling, that could indicate a recession - which causes the government to again take control by lowering interest rates.

How Does This Help With My Boat Loan?

During a recession, sales on luxury items are usually first to drop.  Most people consider boats to be luxury items, so lenders may drop their boat loan interest rates sooner in an effort to get your business.  They may also drop them lower than home or auto loan rates.

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