First-time floating home buyers often focus on the vessel — the hull, the renovation, the layout — and underestimate the slip lease. Experienced floating home brokers and lenders know the opposite is usually true: the slip lease is frequently the most consequential document in the transaction, particularly for financing.
What Is a Slip Lease?
A slip lease is the agreement between a floating home owner and the marina or dock authority that grants the right to moor the floating home at a specific water berth. The floating home owner purchases the vessel but leases the water space separately. The slip lease defines the terms of that arrangement — monthly cost, duration, renewal rights, and the conditions under which it can be terminated.
Why Lenders Care About the Slip Lease
From a lender's perspective, the slip lease is the foundation of the collateral's value. A floating home is only worth what it's worth in its slip. If the slip can be taken away — because the lease expires, the dock authority terminates it, or the marina closes — the home loses most of its value and becomes very difficult to liquidate. Lenders price that risk by requiring favorable slip lease terms as a condition of financing.
Key Slip Lease Terms Lenders Evaluate
Remaining Term
This is the most critical factor. Most lenders want to see at least 5–10 years remaining on the slip lease. A lease expiring in 2–3 years severely limits financing options. Most standard lenders won't write a 15–20 year loan against collateral whose slip could be lost in 3 years.
Renewal Provisions
Is there an automatic right to renew? On what terms? At what rate? Indefinite renewal rights (or long-term leases with automatic renewals) are the strongest collateral. Leases that renew at the marina's discretion introduce uncertainty lenders don't like.
Termination Clauses
Under what circumstances can the marina terminate the lease? Termination for non-payment is standard. Termination for marina redevelopment, regulatory changes, or other non-default reasons creates risk. Lenders read these clauses carefully.
Fee Escalation
Current slip fees in Sausalito run $1,200–$2,500/month. Some lenders evaluate whether the cap on annual increases is reasonable — unlimited or very high escalation rights create potential payment shock that can affect a borrower's ability to afford the home over time.
Transfer Provisions
Can the slip lease be transferred when the home is sold? What approval process does the marina require? A lease that can't be readily transferred makes the home much harder to sell — which affects both your exit and the lender's collateral value.
Red Flags That Can Kill or Complicate Financing
- Fewer than 5 years remaining on the lease
- No renewal right or discretionary renewal only
- Broad termination rights for the marina (beyond non-payment default)
- Non-transferable slip (must get marina approval for any sale)
- Pending marina redevelopment or ownership change
- Month-to-month or no written lease at all
What to Do Before Making an Offer
Before you're under contract, review the slip lease — ideally with both your broker and a real estate attorney familiar with floating home transactions. Ask:
- How long is remaining on the current lease term?
- What are the renewal terms and who controls them?
- What does it take to transfer the slip on sale?
- What is the current monthly fee and what's the cap on increases?
- Are there any pending issues with the marina, dock authority, or regulatory bodies?
Paul Bergeron reviews slip leases as part of every transaction he handles — he's been reading these documents for 40 years and knows what the financing implications of different clauses are before lenders even see the file. Call Paul at (415) 332-7539 before you make an offer.
Ready to talk financing?
Paul Bergeron is the only Sausalito broker who handles both the home and the loan. Call (415) 332-7539 or reach out below.