As I contemplate the possibility of getting a boat and looking into loans and such, a few things jumped at me. These ones below strikes me the most. Please correct me if wrong:
** A new boat price
vs a boat 3-5 year old. New seems to loose about 1/3 of cost by 3-5 year mark. Then, it seems to hold price
for a while depending on add-ons. Sure new is new, and it comes with all the benefits of new. However, to me the loss of a 1/3 of the cost in that time period is not worth the benefits of new.
** There are a lot of poorly cared for 5-8 year old boats out there. Surprisingly, but there are.
** Most boats in marinas
seem to move hardly ever, and I am in south FL!!! It scares me to become one of these in a few months.
Given what I said above, I looked into boat loans. For the size of boat and using the max price I would be willing to pay, I compared a 10 year loan to a 20 year loan (same interest rate of 4.99%, same max price of $145K, same 20% down payment, same boat age of >2004). Knowing me, I know <5 years or so down the road I would want something different/newer. Not necessarily more expensive, but chances are it will be. I'm not the type to upgrade things, so I would be getting something right off the bat now that has pretty much everything I want on day one.
Given this scenario, which makes more sense? 10 year loan or 20 year loan? Of course, the 20 year loan has a much lower monthly payment($1,230 vs $765), which frees up enough money
to pay for the slip and insurance
. But, in the long run, is it worth it to have the 10 year loan instead if one could carry it? I prefer to accrue equity on the boat that can be used for down payment later rather than have to come up with more cash for the trade
down the road. However, the higher payment also means less free money
along the way for incidentals and such (tighter budget
now). Does that make sense?
Please, educate me on how you chose your terms and why. Of course, it goes without saying this is aimed at people with loans and newer boats.