How long did you finance your boat for?

[dmer8282]

Now how many people buying brand new Malibu's are paying cash for them? 10%??? If nobody financed a new boat, I dont think there would be too many used ones around and Malibu probably couldn't even stay in business.

[IXFE]

Now how many people buying brand new Malibu's are paying cash for them? 10%??? If nobody financed a new boat, I dont think there would be too many used ones around and Malibu probably couldn't even stay in business.

Amen, brother!

You know... every forum (car, motorcycle, boat, etc.) has a thread like this one. In every case the only responses are the people who like to brag about how they paid $60k in cash for their ________. They lecture the others about what's prudent (financing is evil, ya' know and only for truly stupid people).

My favorite comment is this one (and it comes up every time w/out fail): "I could have paid cash, but I decided to finance my boat over 100 years because my investment portfolio is so awesome that I get a much better rate of return than the 8% I pay on the boat."

Riiiigggghhhhtttt. I'm sure that's why you chose to finance the boat. I also believe you that your investments yield a risk-free 15%.

Sometimes i wish that all the people who financed their toy would stand up and be counted. Don't be ashamed. I don't have a boat yet, but if/when I do it will likely come with a 20 year note. Not because I plan to own it for 20 years or ever pay it off. It's because I have no interest in paying $1,000 a month for something I can only use three months a year. Does that make me stupid? I don't think so. As long as I buy right (e.g. used or leftover) and Malibu keeps raising the price on new boats, I can and probably will sell the boat in 3-5 years w/out being upside-down.

To those of you who paid cash, congratulations! However, you are not the majority despite what this thread might reflect.

[chrisallenhogs]

Now how many people buying brand new Malibu's are paying cash for them? 10%??? If nobody financed a new boat, I dont think there would be too many used ones around and Malibu probably couldn't even stay in business.

Amen, brother!

You know... every forum (car, motorcycle, boat, etc.) has a thread like this one. In every case the only responses are the people who like to brag about how they paid $60k in cash for their ________. They lecture the others about what's prudent (financing is evil, ya' know and only for truly stupid people).

My favorite comment is this one (and it comes up every time w/out fail): "I could have paid cash, but I decided to finance my boat over 100 years because my investment portfolio is so awesome that I get a much better rate of return than the 8% I pay on the boat."

Riiiigggghhhhtttt. I'm sure that's why you chose to finance the boat. I also believe you that your investments yield a risk-free 15%.

Sometimes i wish that all the people who financed their toy would stand up and be counted. Don't be ashamed. I don't have a boat yet, but if/when I do it will likely come with a 20 year note. Not because I plan to own it for 20 years or ever pay it off. It's because I have no interest in paying $1,000 a month for something I can only use three months a year. Does that make me stupid? I don't think so. As long as I buy right (e.g. used or leftover) and Malibu keeps raising the price on new boats, I can and probably will sell the boat in 3-5 years w/out being upside-down.

To those of you who paid cash, congratulations! However, you are not the majority despite what this thread might reflect.

Nice post. This is what I was kind of getting at as the OP. I talked to the guy at the boat shop and he said that 99% of customers finance for atleast 5 years most for 10 - 20. He said that 2 of the boats in the past year he has had someone lay down 100%.

[dmer8282]

Now how many people buying brand new Malibu's are paying cash for them? 10%??? If nobody financed a new boat, I dont think there would be too many used ones around and Malibu probably couldn't even stay in business.

Amen, brother!

You know... every forum (car, motorcycle, boat, etc.) has a thread like this one. In every case the only responses are the people who like to brag about how they paid $60k in cash for their ________. They lecture the others about what's prudent (financing is evil, ya' know and only for truly stupid people).

My favorite comment is this one (and it comes up every time w/out fail): "I could have paid cash, but I decided to finance my boat over 100 years because my investment portfolio is so awesome that I get a much better rate of return than the 8% I pay on the boat."

Riiiigggghhhhtttt. I'm sure that's why you chose to finance the boat. I also believe you that your investments yield a risk-free 15%.

Sometimes i wish that all the people who financed their toy would stand up and be counted. Don't be ashamed. I don't have a boat yet, but if/when I do it will likely come with a 20 year note. Not because I plan to own it for 20 years or ever pay it off. It's because I have no interest in paying $1,000 a month for something I can only use three months a year. Does that make me stupid? I don't think so. As long as I buy right (e.g. used or leftover) and Malibu keeps raising the price on new boats, I can and probably will sell the boat in 3-5 years w/out being upside-down.

To those of you who paid cash, congratulations! However, you are not the majority despite what this thread might reflect.

Nice post. This is what I was kind of getting at as the OP. I talked to the guy at the boat shop and he said that 99% of customers finance for atleast 5 years most for 10 - 20. He said that 2 of the boats in the past year he has had someone lay down 100%.

Yea, for a minute, it almost sounded like only the rich should have boats. We do call them toys, but for some of us, its a way of life no matter how we pay for them. The 15 yr. loan probably put some people on the water that shouldn't be, but I know there are a few that paid cash that have no business on the water either.

[Brodie]

Yea, for a minute, it almost sounded like only the rich should have boats. We do call them toys, but for some of us, its a way of life no matter how we pay for them. The 15 yr. loan probably put some people on the water that shouldn't be, but I know there are a few that paid cash that have no business on the water either.

Amen!

[auto]

Amen, brother!

My favorite comment is this one (and it comes up every time w/out fail): "I could have paid cash, but I decided to finance my boat over 100 years because my investment portfolio is so awesome that I get a much better rate of return than the 8% I pay on the boat."

Riiiigggghhhhtttt. I'm sure that's why you chose to finance the boat. I also believe you that your investments yield a risk-free 15%.

Man I wish I was as smart as you. Don't know about you, but my boat loan is sitting at 6.125. Let's see what today's account value was, hmmmmm, looks like I am ahead of the game. Nothing is risk free, but the 60K+ buys a some decent amount of risk tolerance. Lose job tomorrow still can pay the bills. You might want to realize some people do have the capital, and choose to finance/rent for 6.125 and keep the money in play.

Edited June 20, 2008 by auto

[jayjoans]

Nice post. This is what I was kind of getting at as the OP. I talked to the guy at the boat shop and he said that 99% of customers finance for atleast 5 years most for 10 - 20. He said that 2 of the boats in the past year he has had someone lay down 100%.

Then your original question should have been "If you bought your boat new from a dealer, how long did you finance it for?".

Asking about who financed for how long is going to get the responses you got. Many of us don't buy new, and don't buy if we have to finance. That's prudence, not stupidity.

I don't doubt that your boat shop guys was right, but his observation and your question are not apples/apples.

[Madmanacrossthewater]

Now how many people buying brand new Malibu's are paying cash for them? 10%??? If nobody financed a new boat, I dont think there would be too many used ones around and Malibu probably couldn't even stay in business.

How so? What does financing have to do with Malibu as a manufacturer?

Edited June 20, 2008 by Madmanacrossthewater

[JohnDoe]

Amen, brother!

My favorite comment is this one (and it comes up every time w/out fail): "I could have paid cash, but I decided to finance my boat over 100 years because my investment portfolio is so awesome that I get a much better rate of return than the 8% I pay on the boat."

Riiiigggghhhhtttt. I'm sure that's why you chose to finance the boat. I also believe you that your investments yield a risk-free 15%.

Man I wish I was as smart as you. Don't know about you, but my boat loan is sitting at 6.125. Let's see what today's account value was, hmmmmm, looks like I am ahead of the game. Nothing is risk free, but the 60K+ buys a some decent amount of risk tolerance. Lose job tomorrow still can pay the bills. You might want to realize some people do have the capital, and choose to finance/rent for 6.125 and keep the money in play.

If someone loses their job they're going to have a hard time because they can't sell boat when they finance too much because they'll be upside down, so you're actually forced to keep it. There is much more security in owning something. High equity=high value even if somewhat unliquid. Not saying financing doesn't make sense sometimes, but like someone earlier posted, I have been taught you never finance a depreciating asset. If you need to finance, then do so with an appreciating asset as collateral. Not saying get a third mortgage on house to buy a boat, but leveraging equity in an appreciating asset is much wiser.

[JohnDoe]

Now how many people buying brand new Malibu's are paying cash for them? 10%??? If nobody financed a new boat, I dont think there would be too many used ones around and Malibu probably couldn't even stay in business.

How so? What does financing have to do with Malibu as a manufacturer?

He's saying that without the financing options available to customers, sales would drop by 90%. I think there'd be less volume, but people would find other ways to pay for their toys.

[dmer8282]

Now how many people buying brand new Malibu's are paying cash for them? 10%??? If nobody financed a new boat, I dont think there would be too many used ones around and Malibu probably couldn't even stay in business.

How so? What does financing have to do with Malibu as a manufacturer?

How many new boats would you sell if your buyers could not finance? My guess was maybe, at the most, 10% of what you sell now. I dont think the original post said "new boats", but that is what I assumed he was talking about. My point was how could Malibu stay in business loosing 90% of their sales, thats all.

[Sandbagger]

This whole thread cracks me up. Pretty simple really, if you want a boat but do not have the cash you finance. If you have the cash you have the choice of either paying off the boat or financing.

BTW, depreciation on the boat is the same whether paid in cash or financed and you can pay now or pay later when you sell it.

Also, someone mentioned liquidity. Nothing is more liquid than cash and a boat is not liquid no matter if it is free and clear or financed. So if you really want to stay liquid wouldn't you be better off with a financed boat with cash in the bank? You might think you can sell the boat if you need the cash but if you needed the cash fast, how much would you have to discount the boat to get it sold fast. Really think about it.

If you are talking about financing the boat so you can blow the money on somthing else, then my opinion is that it is probably a wise idea to pay cash for the boat to remove the temptation of blowing the cash.

I give you one more example regarding cash flow. Say I have a loan on a rental house of $60,000 and the payment is $850 per month and the rent return is say $1,000 per month. The $60,000 boat payment over 20 years is say $410 per month. By financing the boat and paying off the rental house loan my net cash flow is improved by $440 per month.

One more example in hard times; if I had serious cash flow problems and was at risk of losing assets, would I rather lose the financed boat or the financed rental house.

One last thing, refinancing a property will generally have fees and closing costs while my boat loan had no fees whatsoever.

In the final analysis everyones situation is different and what is good for one person may not be good for another. And lets face it, buying a boat is not a good financial decision no matter how it is paid for; that is why I find this thread so funny. For the record, I put 25% down, financed the balance for 20 years and can payoff at any time should I decide that is in my best interest.

[Madmanacrossthewater]

Now how many people buying brand new Malibu's are paying cash for them? 10%??? If nobody financed a new boat, I dont think there would be too many used ones around and Malibu probably couldn't even stay in business.

How so? What does financing have to do with Malibu as a manufacturer?

He's saying that without the financing options available to customers, sales would drop by 90%. I think there'd be less volume, but people would find other ways to pay for their toys.

On average 25% of my deals are financed. Most pay cash, or use another line of credit. This year, I have seen more declines (bad credit) than usual. As mentioned above, most folks aren't buying unless they have the cash to pay for it. I'm sure it's different from dealer to dealer.

[JohnDoe]

BTW, depreciation on the boat is the same whether paid in cash or financed and you can pay now or pay later when you sell it.

Also, someone mentioned liquidity. Nothing is more liquid than cash and a boat is not liquid no matter if it is free and clear or financed. So if you really want to stay liquid wouldn't you be better off with a financed boat with cash in the bank? You might think you can sell the boat if you need the cash but if you needed the cash fast, how much would you have to discount the boat to get it sold fast. Really think about it.

I give you one more example regarding cash flow. Say I have a loan on a rental house of $60,000 and the payment is $850 per month and the rent return is say $1,000 per month. The $60,000 boat payment over 20 years is say $410 per month. By financing the boat and paying off the rental house loan my net cash flow is improved by $440 per month.

One more example in hard times; if I had serious cash flow problems and was at risk of losing assets, would I rather lose the financed boat or the financed rental house.

One last thing, refinancing a property will generally have fees and closing costs while my boat loan had no fees whatsoever.

In the final analysis everyones situation is different and what is good for one person may not be good for another. And lets face it, buying a boat is not a good financial decision no matter how it is paid for; that is why I find this thread so funny. For the record, I put 25% down, financed the balance for 20 years and can payoff at any time should I decide that is in my best interest.

True, as to depreciation, but you're paying interest on a depreciating asset, so you're taking it both ways. Your rental example is over simplified and cannot be responded to as there are way too many other variables.

If you paid 75% of your boat's purchase price, and for example, it was $60K, financed the other 45 at 6.5%, then by year 20, you will have paid $80,522.24 (on just that 45K), on a depreciating asset. Although the future value of the 45K, had it been invested at the same rate, yields a high future value when compunded, but I don't like paying for things once, let alone twice. To each his own.

[Sandbagger]

True, as to depreciation, but you're paying interest on a depreciating asset, so you're taking it both ways. Your rental example is over simplified and cannot be responded to as there are way too many other variables.

If you paid 75% of your boat's purchase price, and for example, it was $60K, financed the other 45 at 6.5%, then by year 20, you will have paid $80,522.24 (on just that 45K), on a depreciating asset. Although the future value of the 45K, had it been invested at the same rate, yields a high future value when compunded, but I don't like paying for things once, let alone twice. To each his own.

Well, I lease my car too, that is probably a bad idea because of all that interest/depreciation I am paying when I could have plunked down the cash and paid no interest right? I also financed my house, you ever calculate how much interest you are paying on that? Maybe I should not buy a house until I can pay all cash, because I would not want to pay it twice. Maybe I should not get a new car every two to three years because of all that interest/depreciation I am paying, just pay off a car and keep it the rest of my life. Same with the boat, I think I will pay all cash because I am keeping it to the day I die, I don't think so.

I will keep getting new cars after the lease runs out and write the payment off as a business expense. Maybe the boat is for business too and could be written off or maybe could be financed by a home equity loan and the interest would be tax deductible.

Anyway, I will keep buying real estate even though I am paying for it two to three times over in interest expense, I will get a new car every time my lease runs out and I will get a new boat, probably even finance it whenever I get tired of the one I have. But the boat is for fun and I do not mind having a payment for it, just like the green fees at the golf course.

And the day I die, it really won't matter how much interest I saved in my lifetime, only that I enjoyed life and lived it well.

Edited June 20, 2008 by Sandbagger

[auto]

Amen, brother!

My favorite comment is this one (and it comes up every time w/out fail): "I could have paid cash, but I decided to finance my boat over 100 years because my investment portfolio is so awesome that I get a much better rate of return than the 8% I pay on the boat."

Riiiigggghhhhtttt. I'm sure that's why you chose to finance the boat. I also believe you that your investments yield a risk-free 15%.

Man I wish I was as smart as you. Don't know about you, but my boat loan is sitting at 6.125. Let's see what today's account value was, hmmmmm, looks like I am ahead of the game. Nothing is risk free, but the 60K+ buys a some decent amount of risk tolerance. Lose job tomorrow still can pay the bills. You might want to realize some people do have the capital, and choose to finance/rent for 6.125 and keep the money in play.

If someone loses their job they're going to have a hard time because they can't sell boat when they finance too much because they'll be upside down, so you're actually forced to keep it. There is much more security in owning something. High equity=high value even if somewhat unliquid. Not saying financing doesn't make sense sometimes, but like someone earlier posted, I have been taught you never finance a depreciating asset. If you need to finance, then do so with an appreciating asset as collateral. Not saying get a third mortgage on house to buy a boat, but leveraging equity in an appreciating asset is much wiser.

Still not getting it, you are lumping people into one category and it does not work. I finance my boats, trade out every two years, never roll or have negative equity and am not upside down, and if I were to lose my job, I don't have to sell house, cars, boats, guns, wine, dogs or clothes to survive, pretty simple.

Plenty of people do this and it works for them, just because you disagree doesn't make it wrong. America is awesome, we all have choices, I am happy with mine.

[Sandbagger]

BTW, depreciation on the boat is the same whether paid in cash or financed and you can pay now or pay later when you sell it.

Also, someone mentioned liquidity. Nothing is more liquid than cash and a boat is not liquid no matter if it is free and clear or financed. So if you really want to stay liquid wouldn't you be better off with a financed boat with cash in the bank? You might think you can sell the boat if you need the cash but if you needed the cash fast, how much would you have to discount the boat to get it sold fast. Really think about it.

I give you one more example regarding cash flow. Say I have a loan on a rental house of $60,000 and the payment is $850 per month and the rent return is say $1,000 per month. The $60,000 boat payment over 20 years is say $410 per month. By financing the boat and paying off the rental house loan my net cash flow is improved by $440 per month.

One more example in hard times; if I had serious cash flow problems and was at risk of losing assets, would I rather lose the financed boat or the financed rental house.

One last thing, refinancing a property will generally have fees and closing costs while my boat loan had no fees whatsoever.

In the final analysis everyones situation is different and what is good for one person may not be good for another. And lets face it, buying a boat is not a good financial decision no matter how it is paid for; that is why I find this thread so funny. For the record, I put 25% down, financed the balance for 20 years and can payoff at any time should I decide that is in my best interest.

True, as to depreciation, but you're paying interest on a depreciating asset, so you're taking it both ways. Your rental example is over simplified and cannot be responded to as there are way too many other variables.

If you paid 75% of your boat's purchase price, and for example, it was $60K, financed the other 45 at 6.5%, then by year 20, you will have paid $80,522.24 (on just that 45K), on a depreciating asset. Although the future value of the 45K, had it been invested at the same rate, yields a high future value when compunded, but I don't like paying for things once, let alone twice. To each his own.

That was my intention, to keep it simple. I really do not care to compare skills on running an HP 12C calculator and I am nobody's money manager, nor do I really care how you paid for your boat or anything else for that matter, just trying to open some minds.

[cbixby]

BTW, depreciation on the boat is the same whether paid in cash or financed and you can pay now or pay later when you sell it.

Also, someone mentioned liquidity. Nothing is more liquid than cash and a boat is not liquid no matter if it is free and clear or financed. So if you really want to stay liquid wouldn't you be better off with a financed boat with cash in the bank? You might think you can sell the boat if you need the cash but if you needed the cash fast, how much would you have to discount the boat to get it sold fast. Really think about it.

I give you one more example regarding cash flow. Say I have a loan on a rental house of $60,000 and the payment is $850 per month and the rent return is say $1,000 per month. The $60,000 boat payment over 20 years is say $410 per month. By financing the boat and paying off the rental house loan my net cash flow is improved by $440 per month.

One more example in hard times; if I had serious cash flow problems and was at risk of losing assets, would I rather lose the financed boat or the financed rental house.

One last thing, refinancing a property will generally have fees and closing costs while my boat loan had no fees whatsoever.

In the final analysis everyones situation is different and what is good for one person may not be good for another. And lets face it, buying a boat is not a good financial decision no matter how it is paid for; that is why I find this thread so funny. For the record, I put 25% down, financed the balance for 20 years and can payoff at any time should I decide that is in my best interest.

True, as to depreciation, but you're paying interest on a depreciating asset, so you're taking it both ways. Your rental example is over simplified and cannot be responded to as there are way too many other variables.

If you paid 75% of your boat's purchase price, and for example, it was $60K, financed the other 45 at 6.5%, then by year 20, you will have paid $80,522.24 (on just that 45K), on a depreciating asset. Although the future value of the 45K, had it been invested at the same rate, yields a high future value when compunded, but I don't like paying for things once, let alone twice. To each his own.

That was my intention, to keep it simple. I really do not care to compare skills on running an HP 12C calculator and I am nobody's money manager, nor do I really care how you paid for your boat or anything else for that matter, just trying to open some minds.

Right now I am financed for 20 years... the reason for that was the horrible interest rates as they are right now. I do plan on refinancing to a 15 year note with a lower interest rate once the rates go down (which I hope they do soon). I put 15% down on the boat and plan on making additional payments each month... but I wanted to make sure that I had some flex room in there if I needed it.

Like everyone else on here I am not rich by any means, but I still want to enjoy a Malibu while I am at the age and health to do so. I don't feel bad one bit financing that long on a boat. Once my finances get into a much better position or I am in the position to pay it off I will, but in the meantime I will be able to still enjoy the boat today rather than 20 years from now when I "may" be able to buy one with cash (wouldn't that be awesome).

Anyway, thought I would share!

PS. I did my boat loan through eboatloans.com and they were GREAT to deal with. I got a MUCH better interest rate (6.65%) with them with better terms and conditions. I would recommend them highly. I was very skeptical on doing a boat loan with anyone other than my trusted lender, but eboatloans changed my mind... I was very happy with the deal they gave me and the process.

[ADHD]

Thats good to hear about eboatloans.com cause my wife kept telling me to call them and I was very adiment about that just cause its some online site!!

I ended up going to my local credit unioun and got a approved for a loan at 9% for 15 years which in the long run ended up being like 14k in intrest alone I almost fell out of my pants and said NO way!! I then asked to talk to the owner of the place and told him I wanted a loan for a new boat and asked if there was any way to put the loan based on my investments I had. I ended up walking out with a 3% share loan for 5 years and my payment only went up 100$ compared to the other loan!! Saved my a** 12k in the long run and am still making intrest off my shares!! LOL..

I guess the old saying is true "U gotta have money to make money"

[TrevorD]

I went 15 yr. for a "safety net" in case times got tight. I currently make pretty healthy payments, though. Part of my income is from oil and gas properties, so it goes without saying that my income has dramatically increased over the last year.

[Sporty]

Financed for 5 years but paid it off today! 4 years early. Feels good to have our "toy" paid for. Now moving that would have been boat payment over to wifes old student loans to speed that up. Might take some time.

[Calexan]

I put 40K down on my 09 LSV. Then financed the rest for 3 years. The payments are going to kill me for a year till I get out of law school, but then after that it shouldnt be a problem and hopefully I can pay it off before the 3 years.

Id rather have the toys now before I start to feel old with the whole "job" thing. I like the thought of being able to take the boat out in warm times and then take the occasional snowboard trip to give me my board fix year round....

[Mike00LXI]

Has anyone actually tried to get a boat loan lately? I'm curious if lenders are being as stingy with boat loans as they are with home loans with the tighening of the credit markets at the moment.

[Calexan]

They didnt give me a hassle at all, and I'm 24. The 40K in cash probably helped them sleep a little better at night though.

[Mot]

Always an intersting thread. My next door neighbor sells boats, pwc's, snowmobiles and quads. He stated that slightly over 90% are financed with no money down. He said this is a new trend as 5 years ago, most people paid cash or only financed a small portion. Our boat was purchased used with the toy fund that had been accumulating so we could act fast on the right deal. If I'd have bout a new Bu for 60K?? I'd have financed it without a second thought. I don't have that sort of scratch just laying around for 100 hours a year of pleasure. For those that do, awesome...I do get joy from your joy. Me, can't do it...no biggie.