Hot Tub Financing 101

Hot Tub September 07, 2017

Blog Update CL (3)

One of the most common comments we hear is 'I would love to have a hot tub, but I really can't afford one right now'. I can definitely understand this viewpoint.

With so many things vying for our money these days (kid's extracurricular activities, college funds, house remodels, family vacations, and the list can keep going on for pages), a hot tub seems to be pretty low on the list. However, with all of the health benefits associated with hot tub ownership, along with potentially adding a new family ritual to your daily or weekly routine, the hot tub might need to be moved up on the priority list.

(Shopping for a hot tub? Schedule a free consultation or wet test.)

Financing options available on hot tubs are actually very simple and attractive in most cases, allowing you to begin the hot tubbing way of life sooner than you may have thought possible - sometimes for less than a daily coffee or caffeine addiction!

Most hot tub retailers will have a variety of financing options available, so we wanted to make sure you are aware of some of the most popular options that are offered by retailers and how they could work for your budget. We have found an average purchase price on hot tubs hovers around $7,000, so we will work through the options with that purchase price.


Local Credit Unions

The first option will most generally be financing through a partnership with a local credit union. This option will typically allow for a purchase price up to $15,000, and will carry an interest rate based on your credit history, but can be as low as 3.9%.  We have found that local credit unions are extremely flexible with the consumer, finding the best payment plan for their budget, and offering differing loan structures varying from a signature loan to home equity loans.  If you use our example from above, a $7,000 hot tub would carry a monthly payment of $161 at 4.9% interest, financed for 48 months.  This equates to $5.36 / day!


Payment Factorhot tub financing

The next option will generally be a payment factor option. This type of financing allows for the lowest payment possible, and generally carries an interest rate of 9.9%. The payment is simply calculated by multiplying a specified 'payment factor' to the total purchase price.

A common payment factor is 2% of the loan balance, so you would simply multiply the purchase price * .02 to come up with your minimum first monthly payment. The minimum monthly payment would then go down each month, as you would apply the payment factor to the remaining loan balance. A 2% payment factor has a loan term of 65 months if you only make the minimum monthly payment. In our example, a $7,000 hot tub purchase would calculate out to $140 minimum payment for the first month - less than $5/day!


Special Financing - 0% Offers

Finally, you can watch for hot tub stores to offer special financing. Generally, a few times per year, each retailer will offer 0% financing for a given number of months - common options are 12, 18, 24, and 36 months. These offers are extremely appealing, as you will only pay the purchase price, and the monthly payment is an easy calculation of the total purchase price / number of months to be financed. As these tend to be shorter finance periods, your monthly payment will be the highest on this option, but the benefit is no associated interest paid. Again, using our example, a $7,000 purchase would calculate out to $194 / month - about $6.50 / day.


As you can see, hot tub financing is easier to navigate than you might think, and there are some great options available for most budgets - making hot tub ownership well within reach for less than the cost of your favorite latte or lunch joint each day!   Might be time to host your own hot tub party!


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