Jump to content

Welcome to TheMalibuCrew!

As a guest, you are welcome to poke around and view the majority of the content that we have to offer, but in order to post, search, contact members, and get full use out of the website you will need to Register for an Account. It's free and it's easy, so don't hesitate to join the TheMalibuCrew Family today!

Sign in to follow this  
Jeffro84

Financing a boat.

Recommended Posts

Jeffro84

I want to get prequalified by a lender and was curious if anyone has done this recently and could give me some pointers. I'll call my credit union and see if they deal in boats. Not sure what the interest is on a used boat. Thanks.

Share this post


Link to post
ericivey21
I want to get prequalified by a lender and was curious if anyone has done this recently and could give me some pointers. I'll call my credit union and see if they deal in boats. Not sure what the interest is on a used boat. Thanks.

I think my interest is around 7 percent. I highly recommend Russo Marine. They did the financing for the guy who bought my boat and I went with them to finance my new boat. Great people to work with. The fee for them is 250 I think. They do all the leg work including all documentation for the boat as well as doing the tags and title work. Saves you a trip to dmv. Ask for Ben Killino if you use them. They can pre approve you when you call in a matter of 2 minutes.

http://www.russomarine.com/content.asp?nav...;cpid=3685&

Share this post


Link to post
crescentbar

All depends on the situation.

Bank of America - Free Home Equity Line of Credit to 85% of the value of your home. Good credit will get you Prime minus 1%. 4.25% right now.

Key Bank is a good one in the NW.

Bank of the West - Good rates/terms but limited online services. Can't make payments online unless you have a checking / savings account with them. They also use the old school payment books. PITA

Share this post


Link to post
SC Fam

My credit union probably would have been ok (my dentist had them falling all over him to get credit...and mine is as good as his), but I had the best success with Bank of America. I paid 7 percent on new boat. You can actually prequalify online...go to www.bofa.com and I think you can wiggle around there until you find the boat loan page. Fill it all out and then wait a few days for them to get back to you. In my case, my dealer sorted it all out for me and called 3 banks...just so happens they landed on BofA also, so that is my story...

Share this post


Link to post
Jeffro84

Thanks for the replies. I think I'll call the marine company first thing tomorrow and see what they have to say.

Share this post


Link to post
CLOUT1

I agree that an equity line is a great option for a boat due to rate and the ability to write off the interest on your return. The only thing I would say is I would strongly look into getting a FIXED home equity not the variable. The "prime-minus" deals sound great but in two years when prime is 2 1/2% higher is won't seem so great. Since rates are rather low a fixed rate is a better option unless you plan on paying it off in the nexty 2 to 3 years...then the variable would work better. Good Luck!!!

Share this post


Link to post
TalleyHo

To each his own, but I wouldn't hedge the house (ie home equity loan) on a boat to save a few bucks in interest. If you can't foot the bill on the boat, then you might have to worry about where you are going to live -- especially in today's market.

I went thru Essex Credit. I think my rate is very low 6's, but I put 15% down. They were one of the more 'generous' lenders requiring less than the typical 20% down payment. Granted they farmed it out to Bank US which I'm not a big fan of, but still it was the best non-home-equity rate at the time.

Good luck.

Share this post


Link to post
BlastRlxi
To each his own, but I wouldn't hedge the house (ie home equity loan) on a boat to save a few bucks in interest. If you can't foot the bill on the boat, then you might have to worry about where you are going to live -- especially in today's market.

I went thru Essex Credit. I think my rate is very low 6's, but I put 15% down. They were one of the more 'generous' lenders requiring less than the typical 20% down payment. Granted they farmed it out to Bank US which I'm not a big fan of, but still it was the best non-home-equity rate at the time.

Good luck.

Plus1.gif

Share this post


Link to post
SCOTTDOMINE
To each his own, but I wouldn't hedge the house (ie home equity loan) on a boat to save a few bucks in interest. If you can't foot the bill on the boat, then you might have to worry about where you are going to live -- especially in today's market.

I went thru Essex Credit. I think my rate is very low 6's, but I put 15% down. They were one of the more 'generous' lenders requiring less than the typical 20% down payment. Granted they farmed it out to Bank US which I'm not a big fan of, but still it was the best non-home-equity rate at the time.

Good luck.

I have to agree w/ not hedging the home on your toys :) JMO though. I have gone through my CU on my last two boats and have gotten in the low 6% range both times. Credit Unions always seem to be just a tick lower than the everyday banks Dontknow.gif

Share this post


Link to post
SacRiverRat

What is wrong with hedging the house? I don't get it.. If you can't afford the loan, you just sell the boat, what is the risk to the house? Plus you can write off the interest, and the rate is equal to or better than any consumer loan you can get.. Dontknow.gif

Seems to me you're just throwing money away, while your home equity just sits there.

Share this post


Link to post
Malibudude
What is wrong with hedging the house? I don't get it.. If you can't afford the loan, you just sell the boat, what is the risk to the house? Plus you can write off the interest, and the rate is equal to or better than any consumer loan you can get.. Dontknow.gif

Seems to me you're just throwing money away, while your home equity just sits there.

Bingo! Either way you're making a payment on a loan.

Share this post


Link to post
BlastRlxi
What is wrong with hedging the house? I don't get it.. If you can't afford the loan, you just sell the boat, what is the risk to the house? Plus you can write off the interest, and the rate is equal to or better than any consumer loan you can get.. Dontknow.gif

Seems to me you're just throwing money away, while your home equity just sits there.

You make excellent points, but, to me, it goes along with not buying stock in the company you work for. If things go bad, you may lose your job and your investment. To each his own, though.

Share this post


Link to post
Malibudude
What is wrong with hedging the house? I don't get it.. If you can't afford the loan, you just sell the boat, what is the risk to the house? Plus you can write off the interest, and the rate is equal to or better than any consumer loan you can get.. Dontknow.gif

Seems to me you're just throwing money away, while your home equity just sits there.

You make excellent points, but, to me, it goes along with not buying stock in the company you work for. If things go bad, you may lose your job and your investment. To each his own, though.

I can understand the diversification aspect, but when I did work for a Fortune 500 company, purchasing stock didn't cost me any fees. I took advantage of it and wish I had invested more since it split 4 times since I've owned it. Either way we own boats and that's the important part!

Share this post


Link to post
BillFooter

I would and did use the home equity option. If your finances are strong enough you are NOT risking your house. Also the interest on the equity note is tax deductible.

Share this post


Link to post
Green_Giant

My preference is to not finance the toys at all. That said, to me using home equity is a decent option assuming taking on any debt is a prudent decision given your families financial position. The cons stated above for using home equity for me would be cons against taking on debt of any kind. So, if there's even a remote possibility of not being able to make the payments, I wouldn't take the debt. Defaulting on a consumer loan is a bad thing, and so is defaulting on a home equity line.

Share this post


Link to post
MalibuCalifornia
To each his own, but I wouldn't hedge the house (ie home equity loan) on a boat to save a few bucks in interest. If you can't foot the bill on the boat, then you might have to worry about where you are going to live -- especially in today's market.

I went thru Essex Credit. I think my rate is very low 6's, but I put 15% down. They were one of the more 'generous' lenders requiring less than the typical 20% down payment. Granted they farmed it out to Bank US which I'm not a big fan of, but still it was the best non-home-equity rate at the time.

Good luck.

Plus1.gifPlus1.gifPlus1.gif

Share this post


Link to post
snowrider

We worked with Patrick Maloney at boatloan.com to get our pre-approved boat loan. The loan ended up being with Sovreign Bank. Pretty easy transaction, 7% rate and minimal fees with $0 down. Patrick was responsive to all my questions both before and after the loan closed. Overall, I would recommend working with them and would do so again for a marine loan.

Share this post


Link to post
Mike00LXI

I've done boat loans with Keybank and Soverign bank and both were good experiences with competitive rates.

Share this post


Link to post
sp0tts

Google "boat loans" and you'll get a bunch of banks that come up. I've seen some banks advertising rates around 5.75%.

Another vote for a home equity line, as long as your finances are strong. If you can write off all the interest, I don't see why you wouldn't go that route unless you were worried aobut financial/job security.

Share this post


Link to post
NorCaliBu
...7% rate and minimal fees with $0 down...

Be prepared for negative equity unless you keep the boat for a while.

Do they offer gap insurance on boat loans? Dontknow.gif I don't finance toys...guess I'm just old fashioned that way. Of course, I also don't have a $70K Shocking.gif boat. No.gif

Share this post


Link to post
CLOUT1

I'm not looking to go off on a rant but I guess I don't understand the people who say that I wouln't "bet the house" on a boat. The main reason why the economy/real estate is going in the tank is becuase people buy things THAT THEY COULDN'T AFFORD IN THE FIRST PLACE on their equity lines!!!! If I can afford a $600 boat payment at 6% then I can afford the same payment at a similar if not lower rate and get the tax break. The tax break, depending on your bracket can actually pay for a payment or two or atleast a few tanks of gas...OK, A tank of gas since we're over $3.00 a gallon.

Share this post


Link to post
Jeffro84

Great points made by all. Signing papers today on 07' 23XTI. I'll have pics up whem I get it. If you go to wakeboardingmag.com and go to the virtual test drives,the 23xti used looks just like the one we bought. I'm happy with the price and financing. We took out a home equity loan to make improvements on our home,make large down payment on the boat and help build the boat dock. (6.5% fixed). This site has really helped with the buyers remorse one feels when dropping 45K on a toy. Twenty years from now when my wife and I are looking at old photos of the kids in that boat,thats what you can't put a price on.

Share this post


Link to post
mrothwell

If your house is not completely paid for, then paying cash for a boat is the same as taking a home equity line out of a house. If you spend $50K (cash) on a boat and have a mortgage of $250K, then it is the same as taking a $50K LOC on the house that has a $200K mortgage. The only difference is that the interest is deductable on the home loan.

Anyone that says they "only pay cash for toys", is not telling the whole story if they still have a house payment.

The trick, is to make sure that you don't over extend. And, dont get yourself into a loan that the rates can skyrocket.

Share this post


Link to post
Green_Giant
Anyone that says they "only pay cash for toys", is not telling the whole story if they still have a house payment.

Respectfully disagree from a monthly cash flow perspective. You have to assume the home mortgage pre-boat purchase is constant in both scenarios. By then financing the 50k boat, your monthly debt service goes up. Yes, it's offset by your interest deduction, but not until tax season, and only at your effective tax rate. JM2C.

The trick, is to make sure that you don't over extend. And, dont get yourself into a loan that the rates can skyrocket.

Totally agree.

Share this post


Link to post
jjackkrash

It is my understanding that the difference is that the security interest in a home equity loan is the house. The security interest in a boat loan is the boat. If you can't make payments on a home equity loan, the bank comes looking for the house. If you can't make payments on a boat loan, the bank comes looking for the boat. Banks prefer looking for the house, so they usually give you a better rate.

In case of a financial disaster such as getting hit with a tort judgment for which you are not insured or underinsured, equity in a house may be protected by homestead laws, but equity in a boat is not. And selling the boat in this situation won't help because the judgment creditor can attach the proceeds of the sale of a non-exempt asset.

In a "worst case scenario," I would rather own the home outright than the boat. It depends on your situation and your risk tolerance.

Share this post


Link to post

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this  

×
×
  • Create New...