Can You Buy A Boat With A VA Loan?

Thomas Short
Military VA Loan contributor

One dream a lot of people share is to someday own a boat. Boats can be used for both living and recreation, and plenty of boat owners are happy with their purchase.

The biggest downside to purchasing a boat is the cost associated; aside from any fees you need for upkeep and storage, boats can cost a lot of money upfront. The total cost of the boat only increases as the boat gets larger as nicer.

It isn’t uncommon for people to secure financing to help afford a boat. Financing can be a safer way to spend money, since most people don’t have the type of cash necessary to make that kind of purchase sitting around. If they do, it can be dangerous to dip too far into those reserves.

When it comes to borrowing money, it’s tough to beat VA loans. Can you use your VA loan eligibility to buy a boat?

Click here for today's VA rates (Jul 15th, 2024)

Can you buy houseboats/RVs?

If you’re eligible for a VA loan, then you’re able to purchase property to live in. A common question many VA home buyers have is if they can use their VA loan to buy a houseboat or an RV. After all, both may be recreational, but they can also be used as a permanent living space.

Unfortunately, the VA does not allow you to use the program to purchase a houseboat or RV. The catch is that your purchase has to be real estate, meaning property needs to be involved. Since both of these types of homes are mobile, they don’t fit the VA’s requirements.

Securing funding for a houseboat or RV can be difficult regardless of what type of loan program you use. Instead of looking to live in your purchase, you could always buy a boat solely for recreational purposes – something you can do through the VA.

Getting a boat with a VA refinance

Not all VA homeowners know this, but there are two types of VA refinance. The first is the IRRRL, which is the most commonly used refinance program the VA offers. The IRRRL is used to lower rates, saving veterans money on their loan.

The other refinance offered is the VA cash-out refinance. This program can also lower your mortgage rates, much like the IRRRL. But the ultimate difference is that you can take equity of your home with a cash-out refinance.

Any cash that you take out of your house is yours, and you can spend it on anything you want – including a new boat.

Check today's VA rates (Jul 15th, 2024)

VA cash-out refinance eligibility

Veterans that are eligible for a VA loan but used another product – such as FHA or conventional – are still eligible to refinance with the VA. In some cases, homeowners are even eligible to refinance through a VA refi even if they aren’t eligible with other programs.

But you can’t take out as much cash as you want. You can only receive cash worth the total equity of your home. This means that if you have $50,000 in equity, you can take out up to $50,000 in cash.

Keep in mind that you don’t have to take out the full amount available. If you have a boat in mind, it’s best to take out a lower amount of cash so you can still have equity in your home. This will help keep your monthly payments lower.

So, while you can’t directly get a boat with a VA loan, there are ways for you to make your dream purchase using products offered by the VA.

Check today's VA cash-out refinance rates (Jul 15th, 2024)