loan rates

[Nitrousbird]

You didn't do Disney....you did Kissimmee.

We did Magic Kingdom. Buildings were impressive - lines and rides were not. No reason to do the animal park when we live 7 minutes, and are a member, to one of the best rated zoos in the nation and are a member to one of the best Safari style parks in the nation as well. We also did the Disney shopping area but that was an overpriced joke so we didn't spend much there.

Now Ive gotten lost on where I sit. NB sounds very frugal with his money and can save like the best of them(Ive never gotten out of a vacation for under $5k, even when it was just me for a weekend in vegas... ), hell probably retire 15 years earlier than me and probably is way smarter than I WANT to be. On the other hand, I could never justify spending 2x on a boat financing it. $80k is a lot on a boat and if you said "If you take out a loan, youll actually pay $140k" Id probably s*** myself. Even with making double payments, I can go to Europe and back 5 times with my wife with what I save(Not on the cheap either).

I prefer referring to myself as cheap than frugal. My wife can save with the best of them - I just don't overspend. I hate not paying the best price for something - it feels like throwing money away. I have too much respect for money.

We all make financial mistakes. I should have taken the 10k loss when I tried to sell my rental property instead of renting it. Now that loss would be in the 20-25k range if I tried to sell. Bad investment gamble. Wife and I have both made bad stock market picks. I regret not spending more during the housing crash, though we did take a decent advantage out of it.

[ctvandy23]

I cant believe this thread still has legs! Quite a spirited debate...who knew. I originally checked in to see what rates people were getting to compare to my rate never thinking there would be so much passion tied to boat loans, for or agin! Anyway, I am on my second boat loan and I can definitely see both sides. Both loans were/are right around 4%, to me that is cheap money. I would rather keep my cash/investments in place and use the bank's cash for my toys. I know the whole interest debate and that's just the price of doing business! Think about it, no matter what we do in life there is a price, financially or otherwise. So I get those that believe cash is king, but I also believe in the balance of life, understanding that life is way too short and the importance of enjoying life when you can enjoy it! Sometimes waiting for the right time just never comes. I caveat all this of course by agreeing with those who have stated in previous posts that you need to be responsible when making financial decisions. Sinking under the weight of a boat loan is not good, but with proper planning and figuring out what is right for you and your family, a boat loan may be the ticket to years of enjoyment. Great memories are hard to quantify, no? Yes yes, as others have stated, you don't necessarily need a new 100K boat to make memories, but that is true for a lot of things in life, but yet most of us desire to make our lives better through material things at some point. Again its a balance!

Personally and according to my wife, she would been happy with our 2001 Crownline, and maybe that's true...but I for one cant wait to unwrap my brand new VLX this spring!!

[ahopkins22LSV]

I cant believe this thread still has legs! Quite a spirited debate...who knew. I originally checked in to see what rates people were getting to compare to my rate never thinking there would be so much passion tied to boat loans, for or agin! Anyway, I am on my second boat loan and I can definitely see both sides. Both loans were/are right around 4%, to me that is cheap money. I would rather keep my cash/investments in place and use the bank's cash for my toys. I know the whole interest debate and that's just the price of doing business! Think about it, no matter what we do in life there is a price, financially or otherwise. So I get those that believe cash is king, but I also believe in the balance of life, understanding that life is way too short and the importance of enjoying life when you can enjoy it! Sometimes waiting for the right time just never comes. I caveat all this of course by agreeing with those who have stated in previous posts that you need to be responsible when making financial decisions. Sinking under the weight of a boat loan is not good, but with proper planning and figuring out what is right for you and your family, a boat loan may be the ticket to years of enjoyment. Great memories are hard to quantify, no? Yes yes, as others have stated, you don't necessarily need a new 100K boat to make memories, but that is true for a lot of things in life, but yet most of us desire to make our lives better through material things at some point. Again its a balance!

Personally and according to my wife, she would been happy with our 2001 Crownline, and maybe that's true...but I for one cant wait to unwrap my brand new VLX this spring!!

And we all can't wait to see it!!

[pauley71]

I cant believe this thread still has legs! Quite a spirited debate...who knew. I originally checked in to see what rates people were getting to compare to my rate never thinking there would be so much passion tied to boat loans, for or agin! Anyway, I am on my second boat loan and I can definitely see both sides. Both loans were/are right around 4%, to me that is cheap money. I would rather keep my cash/investments in place and use the bank's cash for my toys. I know the whole interest debate and that's just the price of doing business! Think about it, no matter what we do in life there is a price, financially or otherwise. So I get those that believe cash is king, but I also believe in the balance of life, understanding that life is way too short and the importance of enjoying life when you can enjoy it! Sometimes waiting for the right time just never comes. I caveat all this of course by agreeing with those who have stated in previous posts that you need to be responsible when making financial decisions. Sinking under the weight of a boat loan is not good, but with proper planning and figuring out what is right for you and your family, a boat loan may be the ticket to years of enjoyment. Great memories are hard to quantify, no? Yes yes, as others have stated, you don't necessarily need a new 100K boat to make memories, but that is true for a lot of things in life, but yet most of us desire to make our lives better through material things at some point. Again its a balance!

Personally and according to my wife, she would been happy with our 2001 Crownline, and maybe that's true...but I for one cant wait to unwrap my brand new VLX this spring!!

Congrats on the new ride. Enjoy it and the time with the family...

[Steve B.]

Here I go on a tangent, oh well. But, even as cheap/frugal gas prices are now, you can get flights to Orlando for around $49.00 each way ! I wouldn't want to put the wear and tear and stress of driving.

My $.02

Steve B.

[robbennett]

Here I go on a tangent, oh well. But, even as cheap/frugal gas prices are now, you can get flights to Orlando for around $49.00 each way ! I wouldn't want to put the wear and tear and stress of driving.

My $.02

Steve B.

What airline? My ticket to Tampa tomorrow was $260 one way with Delta. I did wait until yesterday to buy it though.

[Nitrousbird]

Here I go on a tangent, oh well. But, even as cheap/frugal gas prices are now, you can get flights to Orlando for around $49.00 each way ! I wouldn't want to put the wear and tear and stress of driving.

My $.02

Steve B.

Not a year ago (haven't checked now). I checked Cinncy, Columbus, Cleveland, Dayton and even the crappy flight out of Rickenbacker that only runs twice a week when we were looking last year. Obviously I'd fly at that rate of available.

[That Guy]

Here I go on a tangent, oh well. But, even as cheap/frugal gas prices are now, you can get flights to Orlando for around $49.00 each way ! I wouldn't want to put the wear and tear and stress of driving.

My $.02

Steve B.

+1. We flew Southwest and had 3 direct flight roundtrip flights for under $500. You couldn't put me in a car for 30 hours for that much...let alone the cost of a hotel or two, fuel, and missing out on 2+ days of vacation. I take time off to ENJOY it, not sit in a car for 2 days straight.

[Nitrousbird]

+1. We flew Southwest and had 3 direct flight roundtrip flights for under $500. You couldn't put me in a car for 30 hours for that much...let alone the cost of a hotel or two, fuel, and missing out on 2+ days of vacation. I take time off to ENJOY it, not sit in a car for 2 days straight.

15 hours each way. Travel at night, take turns driving, sleep when your aren't driving. Sure, it is nicer to fly but I've done it many times. No need for a hotel. You aren't eating 2 days of vacation since you leave the night before, typically arriving the same time or before a flight. You loose the day back, but combine your drive to the airport, waiting in airport, flight, time getting your bags, time getting a rental car, travel from airport to your destination, etc and it all adds up.

Same reason we will fly direct from Toronto instead of Columbus when going to Newfoundland when the price makes sense. Overall travel time ends up being nearly identical. Lately the direct flight is more expensive (makes no sense for it to be cheaper to take a plane to get onto the next same plane) so we haven't been doing it.

[Cmb396]

I cant believe this thread still has legs! Quite a spirited debate...who knew. I originally checked in to see what rates people were getting to compare to my rate never thinking there would be so much passion tied to boat loans, for or agin! Anyway, I am on my second boat loan and I can definitely see both sides. Both loans were/are right around 4%, to me that is cheap money. I would rather keep my cash/investments in place and use the bank's cash for my toys. I know the whole interest debate and that's just the price of doing business! Think about it, no matter what we do in life there is a price, financially or otherwise. So I get those that believe cash is king, but I also believe in the balance of life, understanding that life is way too short and the importance of enjoying life when you can enjoy it! Sometimes waiting for the right time just never comes. I caveat all this of course by agreeing with those who have stated in previous posts that you need to be responsible when making financial decisions. Sinking under the weight of a boat loan is not good, but with proper planning and figuring out what is right for you and your family, a boat loan may be the ticket to years of enjoyment. Great memories are hard to quantify, no? Yes yes, as others have stated, you don't necessarily need a new 100K boat to make memories, but that is true for a lot of things in life, but yet most of us desire to make our lives better through material things at some point. Again its a balance!

Personally and according to my wife, she would been happy with our 2001 Crownline, and maybe that's true...but I for one cant wait to unwrap my brand new VLX this spring!!

Well said!! This is my stance! Enjoy your VLX! I'm on my way this weekend to look at a 13' LSV.

[ctvandy23]

Good luck with 13'!! Take lots of photos...photos are always good!

[williemon]

Geez!! You guys can spend some money!! glad my stuffs paid for now. Id still use a loan though to get something now rather than wait and save for several years. If rates were higher i would not though. Just thought id keep stirring the pot. ??

[jwl019]

So...how many oppose financing lake front property? Avereage land loan rates?

Example:

Looking at 3 acres on the lake, already has some trees cleared near the lake. Price is $180k, debating on offering $125-150.

[05hammerhead]

So...how many oppose financing lake front property? Avereage land loan rates?

Example:

Looking at 3 acres on the lake, already has some trees cleared near the lake. Price is $180k, debating on offering $125-150.

Do it. Real estate only goes up. Especially lakefront.

[williemon]

Have to remember that every dollar in intrest paid on something other than real estate is money you never get back.

180k for 3 acres on a lake? Man, around here youd have to pay three times that if you could even find something that large.

[pauley71]

So...how many oppose financing lake front property? Avereage land loan rates?

Example:

Looking at 3 acres on the lake, already has some trees cleared near the lake. Price is $180k, debating on offering $125-150.

Just remember that land loans aren't very friendly. Not deductible interest, require large amounts down and typically are balloons.

[williemon]

I was able to use a heloc to purchase land some time ago and have since built, moved in and, sold old house. Its deductable in my case up to the actual value of the home it was secured with. I had lots of equity in my previous home and put quite a bit down on the 11 acers i purchased. Land around here is a bit high.

[bamabonners]

I hate all the holier than thou attitudes that always seem to come about in these loan discussions. Just make the decision that is best for your family and move on. Reminds me of the public school, home school, private school discussions.

[carguy79ta]

I had my house paid for. Bought boat with loan thru my bank. Rolled it into a heloc with the same bank. (3 months time frame). Have been looking for a new home for a while. Found a home, took money out of heloc on first home to put 20% down on new home. Sold first home, therefore paying off the heloc and the boat. I will take the proceeds to build a metal building for cars and the boat. My goal was to take advantage of the mortgage rates and to leverage my assets. I have a 20% home loan 3.2% for 15 years

BTW, I had a 2001 crownline also, for 4 years. Good family memories.

[67King]

Just remember that land loans aren't very friendly. Not deductible interest, require large amounts down and typically are balloons.

You can always do a construction and perm loan if you plan to build on it.

To answer the above question, no I don't oppose financing an appreciating asset, especially when the interest is tax deductible.

[ajive]

This thread has both talked me into ordering the VLX I've been dreaming of... but also to sell my VTX and go debt free.

Winter time is complicated.

Not that it really matters in the long run of this thread, but in my particular case I'm looking at ~$5000 worth of financing cost over the 60 months I plan to pay off the VTX. Whatever. Not the best $5k I've ever spent, but I'm typing this on my 5 year old laptop with duct tape on the hinges; so I'm sure I could think of a less satisfying way to spend it.

And for the record, I intend to order that VLX at the end of the season, so call it $7000 worth of financing cost over 7 years. Whatever. Would I blow that up front for the privilege, probably not; but I'm excited every time I open the garage door and there is nothing I'd rather be doing on a long, hot summer Saturday with my friends and family.

Dave Ramsey has good points and I actually use some of his behavioral tricks to ensure that I stay on a reasonable path. But if you're saving responsibly and can keep the finance costs in line, why the hell not!?

[67King]

But if you're saving responsibly and can keep the finance costs in line, why the hell not!?

Well, this is for overall public debt, but twice in the past hundred years, private sector debt has exceeded GDP, once in 1929, the other in 2007. Yeah, we're talking macroeconomics versus microeconomics. But the mindset of living off of debt is what caused the great depression, and then the great recession. About half the country has a negative net worth (financing depreciating assets moves one towards the negative). I don't mean to imply that everyone should live in fear of going bankrupt the next time we have another economic downturn, but the answer to your question is basically that. If the economy turns downwards, and one loses his job, would they be at risk to go bankrupt during the downturn? If so......that's why. If not, then you are right.

Again, not "preaching." Just explaining why many people are opposed to financing. If one has enough liquidity to cover the principal, and can generate a greater return than the financing rate, then Dave Ramsey can pound sand. But that is pretty rare.

[ajive]

This debate/discussion is clearly fizzling, but I'd be remiss if I didn't give you a little bit of a hard time over that chart. That situation had very little to do with a bunch of $30k boat loans.

When I was fresh out of college, 2005ish, and my household income was in the 60s I was offered a $350k interest only mortgage.

There is an immeasurable difference between taking out a slightly irresponsible toy loan that maybe delays your retirement 18-36 months vs taking out a speculative loan that you have no hope of repaying.

Sure, 2008 included a bunch of people driving cars they couldn't afford and some boats and RVs were mixed in. But it's my hope that in the case of this thread it's a case of high earners making metered decisions that they understand rather than blatant disregard for the risks of financing.

And for what's its worth, I still don't have a $350k house!

[67King]

This debate/discussion is clearly fizzling, but I'd be remiss if I didn't give you a little bit of a hard time over that chart. That situation had very little to do with a bunch of $30k boat loans.

When I was fresh out of college, 2005ish, and my household income was in the 60s I was offered a $350k interest only mortgage.

There is an immeasurable difference between taking out a slightly irresponsible toy loan that maybe delays your retirement 18-36 months vs taking out a speculative loan that you have no hope of repaying.

Sure, 2008 included a bunch of people driving cars they couldn't afford and some boats and RVs were mixed in. But it's my hope that in the case of this thread it's a case of high earners making metered decisions that they understand rather than blatant disregard for the risks of financing.

And for what's its worth, I still don't have a $350k house!

Um.....okay? I clearly stated that it was macro (the economy as a whole) versus micro (individual behavior) economics. And I clearly stated that the mindset is what led to it. It may be a $30K boat loan here. In other places, it may be a $30K car loan. And in the chart I listed, it is all of those loans for depreciating assets multiplied by a population of $300M that results in the scenario. And boats are depreciating assets. Was housing one of the factors in the crash? Certainly.....was it the only one? No. Like I said, it was the mindset of living off of debt. But I was NOT trying to imply that people here getting boat loans would drive down the economy. I was trying to answer your question.

Now let's let this come full circle, and I'll elaborate on things that I did not, as I assumed it would be inferred. I'm 5 years ahead of you, and I had a very similar scenario (not interest only, but twice as much house as my then $60K salary would have been able to realistically support). But Ford started laying off people 2 years after I got there. Then more several years into it. I started in August of 2000, and by the end of CY 2006, there had been 2 10% reduction, and 1 30% reduction. This was from a combination of both voluntary and involuntary separations I left in July, 2007. That Fall, there was another 10%. Within the timespan of about 7.5 years, the number of engineers (making an average salary I'd guess between $80-100K) had been cut in half. Many high level people one wouldn't associate as being expendable.

Now again, you had aksed a question that I was trying to answer. You had said that if you could keep up with the finance charges, why not? The second paragraph above tells you exactly why not. If one has a loan on a boat - ANY depreciating asset - what happens if one loses his job? Can said person cover his debts (and I'll say that cars are different, as transportation is a need)? If the debt is on an appreciating asset such as a house, one could sell the house and not be negatively affected*. If it is on a boat, especially a long term loan, and again especially in a down economy (where demand for luxury items falls), one would be at risk for not being able to cover the loan with the sale of the boat. And if one doens't have the funds to cover the difference between market value and outstanding principal, then he is in a whole world of hurt because he won't be able to sell the boat!

* For most of the country, there were exceptions in regions with more volatile housing markets, Las Vegas being a prime example. But overall, for average purposes, they won't be depreciating.

And let me add for clarity, I'm not judging anyone, or asking anyone to follow my advice or any of that. I don't recall preaching on here about the evils of a boat loan, if I did, I'd be a hypocrite, as I financed my first one for a few years. I was just answering the "why the Hell not?" question that was asked. Obviously one has to balance risks when determining that. A high caliber family physician carries very little risk for losing his job. A low performing factory worker is at a greater risk to losing his job. Sheesh, any engineer for any of the Big 3 is at risk, given the cyclical nature of the industry.

[gblasko]

2.29 to 2.99 at Credit Unions in MN.

Which Credit Unions in MN?