Boat Financing

[wakesetter2001]

I am looking at a new 2007 Wakesetter VLX. I am just wanting to know of good boat finance places that anyone has delt with. I am trying to find a better % rate then what the locals have around here to try and bring the payments down. I have looked online and found a few better rates but I am very hesitent with online CO. One of them is Boatguyz.com. My current boat (2001 Sunsetter LXi (For Sale By the way)) is financed through Bank of the west and they are offering 7.75% at this time. Any help or knowlege will be great.

[Madmanacrossthewater]

7.75 is a pretty good rate nowdays. The 4's and 5's have been gone for a few years now.

[vlx wakesetter]

If thats for 15 years then I would consider going with them. My guess is anything under 8% for 15 years is a fair deal, just keep checking around because it doesn't hurt to get multiple quotes

[TalleyHo]

I got <6.5% -- for 15 yrs thru EssexCredit(.com) in May. They were fairly easy to deal with. They were also the lowest wrt down payment requirement (15% vs. 20%). That's a good chunk of change tho for these boats.

[Sunapee]

If you own a home, and have equity in it, consider a HELOC (Home Equity Line of Credit). The interest rate is usually lower than a consumer loan, you are only required to pay the interest each month, and all interest is deductible because it is a mortgage not a consumer loan. You are in control of how fast you reduce the principal.

[vlx wakesetter]

No down payment for us when we initially got the loan After we got the loan through Wells Fargo at 7.25% for 15yrs then we put 30k down to lower our principal

[68Slalom]

If you own a home, and have equity in it, consider a HELOC (Home Equity Line of Credit). The interest rate is usually lower than a consumer loan, you are only required to pay the interest each month, and all interest is deductible because it is a mortgage not a consumer loan. You are in control of how fast you reduce the principal.

This is the way to go if and that's "IF" you own a home and have enough equity. Good Luck, I went with Patelco Credit Union and did 5 year loan at 8% so 7% for 15 years isn't bad.

[Lakenut]

15 years for a boat is absolutly crazy!!!!! Whats that 07 wakesetter going to look and run like in 2022?

[jessem]

If you own a home, and have equity in it, consider a HELOC (Home Equity Line of Credit). The interest rate is usually lower than a consumer loan, you are only required to pay the interest each month, and all interest is deductible because it is a mortgage not a consumer loan. You are in control of how fast you reduce the principal.

I think that's a horrible idea all HELOC's are tied to prime and prime is riding at 8.25% and why in the world would you want to turn your short term financing (BOAT CAR TRUCK RV) into long term debt that is constantly depreciating But to each thier own

[IceMelted]

If you own a home, and have equity in it, consider a HELOC (Home Equity Line of Credit). The interest rate is usually lower than a consumer loan, you are only required to pay the interest each month, and all interest is deductible because it is a mortgage not a consumer loan. You are in control of how fast you reduce the principal.

OUCH!!!! We went that route with a second boat (Our Pontoon) and even with making considerable additional payments, the principle never seems to move. It will end up being the most expensive Pontoon on our lake by the time were done paying for it. So if your really going to consider this, make sure to be committed to doubling down on the monthly payments at the least.

[Sunapee]

If you own a home, and have equity in it, consider a HELOC (Home Equity Line of Credit). The interest rate is usually lower than a consumer loan, you are only required to pay the interest each month, and all interest is deductible because it is a mortgage not a consumer loan. You are in control of how fast you reduce the principal.

OUCH!!!! We went that route with a second boat (Our Pontoon) and even with making considerable additional payments, the principle never seems to move. It will end up being the most expensive Pontoon on our lake by the time were done paying for it. So if your really going to consider this, make sure to be committed to doubling down on the monthly payments at the least.

As I said, YOU control how fast you reduce the principal. If it is set up for a monthly payment that is interest only and you do not increase your monthly payments then you will never touch the principal. Using simply math you can figure out how much extra to pay each month to pay it off in nn months (principal / nn). At that point your payments would be the same as a consumer loan. In the event something happens and you need to skip the additional principal reduction in any given month you can (again YOU are in control). I would recommend that you never let the principal exceed the current value of the boat. Also, don't discount the tax advantage of a mortage vs. a consumer loan.

If you are not disciplined enough to manage the HELOC then you should stay away from it.

[CLOUT1]

If you own a home, and have equity in it, consider a HELOC (Home Equity Line of Credit). The interest rate is usually lower than a consumer loan, you are only required to pay the interest each month, and all interest is deductible because it is a mortgage not a consumer loan. You are in control of how fast you reduce the principal.

You have to have descipline to use a HELOC. My wife and I did the same thing...wrote off the interest and had a sub-six rate. We opened a line to do an addition on the house and had enough for the bu. Some people who have issues with HELOCs don't understand what their doing...DON'T do interest only...be carefull, it is a very large credit card against your house!!!

[68Slalom]

15 years for a boat is absolutly crazy!!!!! Whats that 07 wakesetter going to look and run like in 2022?

I have seen lots of boats that are 15 years old and look great, it all depends on how you treat the

[vlx wakesetter]

15 years for a boat is absolutly crazy!!!!! Whats that 07 wakesetter going to look and run like in 2022?

I have seen lots of boats that are 15 years old and look great, it all depends on how you treat the

[jessem]

I don't have any issue with HELOC's I just think it is a unwise move to use your home equity for a Boat that is always depreciating. If I can't afford to do a consumer loan on a recreational vehicle I probably wouldn't buy one.

[SacRiverRat]

Once you factor in the tax deductibility, and lower interest rate of the HELOC, seems like the wise choice. Sure, you really don't want to be paying for your boat over 15 or 30years - but respectfully - that is a lame argument. You can still make the same monthly payment, that you would with a conventional loan. You can also get a second mortgage with a fixed interest - so if you're concerned about the interest rate, go that route.

If you can get a lower rate, and deduct the interest, why wouldn't you leverage the equity in the house?

[SacRiverRat]

I don't have any issue with HELOC's I just think it is a unwise move to use your home equity for a Boat that is always depreciating. If I can't afford to do a consumer loan on a recreational vehicle I probably wouldn't buy one.

I don't realize what difference it makes what secures the loan (the boat or your house). Either way, you're buying a boat that will depreciate.. Shouldn't you try and reduce how much it will cost you?

[jessem]

I don't have any issue with HELOC's I just think it is a unwise move to use your home equity for a Boat that is always depreciating. If I can't afford to do a consumer loan on a recreational vehicle I probably wouldn't buy one.

I don't realize what difference it makes what secures the loan (the boat or your house). Either way, you're buying a boat that will depreciate.. Shouldn't you try and reduce how much it will cost you?

I am a mortgage broker bye trade and the problem is, is that 99% of the people out there are not disciplined enough to manage their HELOC's. The days of HELOCS being in the 6's are long gone, As I stated earlier all HELOC are tied to the prime rate and prime is at 8.25% Back 3 or 4 years ago when prime was at 4.25% I would say it was a little bit better idea because at that point it was cheaper than regular boat loan with the so called benifit of the tax write off. If it was me and had some equity to pull out, I would find something to invest it in that would pay me a decent rate of return and use the interest to pay the boat payment still have the principal of my equity in the investment while the boat was being paid for. Say you pull 50K out on your equity line invest it in something paying you 12%APR that would pay you $500.00 a month in interest more then enough to make a regular boat loan payment Just my opinion...

[SKI LVR]

Since you don't REALLY enjoy a boat until it is paid off, buy a used one with money you have.

Year after year of payments through winter months gets really old.

My first boat cost very little. That's what I could afford then. By avoiding huge debt on depreciating assets used only a portion of the year (boat) I could eventually afford better and better boats, and I am able to sleep well.

If deducting the interest on a loan is such a great idea, why not get a real high interest rate?

[Badger]

I don't have any issue with HELOC's I just think it is a unwise move to use your home equity for a Boat that is always depreciating. If I can't afford to do a consumer loan on a recreational vehicle I probably wouldn't buy one.

I don't realize what difference it makes what secures the loan (the boat or your house). Either way, you're buying a boat that will depreciate.. Shouldn't you try and reduce how much it will cost you?

Say you pull 50K out on your equity line invest it in something paying you 12%APR that would pay you $500.00 a month in interest more then enough to make a regular boat loan payment Just my opinion...

I know the stock market has done pretty well for the first half of the year, but I'd like to know where I can get a enough of a guarantee for 12% to pull equity out of my house to use for investment purposes?? I guess I just like have the feeling of not being 100% mortgaged.

If you are borrowing for the boat and have the equity available in your home, I think the fixed rate and tax deductible interest of a home equity loan (not line) is the way to go. The way I look at it, the ability to deduct the interest, gives you a discount on the percentage rate equal to your tax bracket.

Badger

[jessem]

I don't have any issue with HELOC's I just think it is a unwise move to use your home equity for a Boat that is always depreciating. If I can't afford to do a consumer loan on a recreational vehicle I probably wouldn't buy one.

I don't realize what difference it makes what secures the loan (the boat or your house). Either way, you're buying a boat that will depreciate.. Shouldn't you try and reduce how much it will cost you?

Say you pull 50K out on your equity line invest it in something paying you 12%APR that would pay you $500.00 a month in interest more then enough to make a regular boat loan payment Just my opinion...

I know the stock market has done pretty well for the first half of the year, but I'd like to know where I can get a enough of a guarantee for 12% to pull equity out of my house to use for investment purposes?? I guess I just like have the feeling of not being 100% mortgaged.

If you are borrowing for the boat and have the equity available in your home, I think the fixed rate and tax deductible interest of a home equity loan (not line) is the way to go. The way I look at it, the ability to deduct the interest, gives you a discount on the percentage rate equal to your tax bracket.

Badger

Badger:

I never said Stock Market and I am surely not here to argue about how to pay for peoples recreational toys I am just giving my opinion. Nothing is guranteed in investments but I have an investment that pays a consistent (for the last three years) 1.5% per month. Myself, I don't care if my home is ever paid for so 100% mortgage is the best for me, but that's a totally different discusion

Jesse

[Malibudude]

I don't have any issue with HELOC's I just think it is a unwise move to use your home equity for a Boat that is always depreciating. If I can't afford to do a consumer loan on a recreational vehicle I probably wouldn't buy one.

I don't realize what difference it makes what secures the loan (the boat or your house). Either way, you're buying a boat that will depreciate.. Shouldn't you try and reduce how much it will cost you?

I am a mortgage broker bye trade and the problem is, is that 99% of the people out there are not disciplined enough to manage their HELOC's. The days of HELOCS being in the 6's are long gone, As I stated earlier all HELOC are tied to the prime rate and prime is at 8.25% Back 3 or 4 years ago when prime was at 4.25% I would say it was a little bit better idea because at that point it was cheaper than regular boat loan with the so called benifit of the tax write off. If it was me and had some equity to pull out, I would find something to invest it in that would pay me a decent rate of return and use the interest to pay the boat payment still have the principal of my equity in the investment while the boat was being paid for. Say you pull 50K out on your equity line invest it in something paying you 12%APR that would pay you $500.00 a month in interest more then enough to make a regular boat loan payment Just my opinion...

Many just aren’t knowledgeable enough about the making investments and thinking long term so the idea of writing off interest is real and something one can grasp. We did the HELOC; in fact we have an interest only mortgage loan now we just make extra principle payments every month. The idea of investing vs. writing off concept is the investor vs. the average Joe. I completely understand where you’re coming from and our financial consultant said the exact same thing i.e. get a convention loan and invest. Our boat was paid off in a year and we were able to deduct the interest as well, just another benefit DD’s are cheaper.

[JohnDoe]

I don't have any issue with HELOC's I just think it is a unwise move to use your home equity for a Boat that is always depreciating. If I can't afford to do a consumer loan on a recreational vehicle I probably wouldn't buy one.

I don't realize what difference it makes what secures the loan (the boat or your house). Either way, you're buying a boat that will depreciate.. Shouldn't you try and reduce how much it will cost you?

Say you pull 50K out on your equity line invest it in something paying you 12%APR that would pay you $500.00 a month in interest more then enough to make a regular boat loan payment Just my opinion...

I know the stock market has done pretty well for the first half of the year, but I'd like to know where I can get a enough of a guarantee for 12% to pull equity out of my house to use for investment purposes?? I guess I just like have the feeling of not being 100% mortgaged.

If you are borrowing for the boat and have the equity available in your home, I think the fixed rate and tax deductible interest of a home equity loan (not line) is the way to go. The way I look at it, the ability to deduct the interest, gives you a discount on the percentage rate equal to your tax bracket.

Badger

Badger:

I never said Stock Market and I am surely not here to argue about how to pay for peoples recreational toys I am just giving my opinion. Nothing is guranteed in investments but I have an investment that pays a consistent (for the last three years) 1.5% per month. Myself, I don't care if my home is ever paid for so 100% mortgage is the best for me, but that's a totally different discusion

Jesse

Something paying 12% APR (which, I have personally never heard of) and something retrurning a 12% ROI are 2 very different things. Many MFs have returned more than 20% last year, but that doesn't mean that 20% should be used as an expectation for return when making financial planning decisions.

[lxirod]

has anyone obtained a loan after the boat was " paid " for. i have a high interest loan i would like to eliminate but its a personal loan so there is no lien on the boat..

Edited July 16, 2007 by lxirod