Boat loans for Young Professionals

[Hermanns]

I too went through this in my late 20's.

Had no debt, 401k, savings -- but little to no credit. Finally saved 25% down for our loft and started to truly build our credit up. A auto lease followed (now on my 2nd) and a Amex card. Within 5 yrs we qualified for a "Luxury Boat Loan" - which means the underwriters are super scrutinizing! (I was told by my broker ALL boat loans are luxury considerations and income, assets + fico trump all.

My 2 cents at least...

[sailorboy1]

I think that people who take the "all debt/credit is evil" approach and avoid it at all costs are sticking their heads in the sand! Good credit is your friend unless you are an idiot who can not control yourself.

Hell currently interest rates are so low you sometimes are a fool to not use credit!

[OnTour]

Try your personal bank or credit union. I have had much better luck with my personal bank than the so called marine lenders.

[flash]

For $40,000 you can get a nice entry level live aboard. Why go into debt? If I were in your shoes I would look for something like an '80s Pearson 365 which can be had for less than that. Not a speed demon, but comfortable, very well-built, stall shower, attractive...

[jpmccros]

Thanks flash, I've got center cockpits on my mind. I've found that they are going to be the best layout to comfort my live aboard lifestyle.

[mub]

Originally Posted by denverd0n

I've heard this before, and it makes absolutely no sense to me. Understand, I'm not doubting the truth of it, just saying that it is completely illogical.

When it comes to home mortgages, you can get a bigger loan if you say it is your residence, rather than a second home. The reasoning is that you will be willing to do more, make more sacrifices, to keep up with the payments on your primary home than you would for a second home. Why the underwriters for boat loans would conclude the exact opposite, completely escapes me.

Just going through this.

For the national lenders it is true.. living on the boat is considered vagrancy.
However the specialty boat and local lenders wanted me to live on the boat as it implied a high level of supervision.

All depends if the person understands what you are talking about!

Mub

[Group9]

Try asking about owner financing. That was the way I bought my first expensive sailboat. A lot of people would like to get rid of sailboats right now, who own them outright. If I was trying to sell mine, and needed it sold right away, I would consider financing 50 per cent of the price for someone with a job and not much credit history yet.

[jpmccros]

I will try that out. How would the contract be written out? For example would it be like buyer agrees to pay 50% down payment, and will finance 50% through seller for 3 years. Buyer will resume boat title until completely paid.

If you were selling the boat, what type of contract would you agree to that should protect you if the buyer couldn't make payment?

[Anzo]

I got owner financing on mine, too. I got the broker to present the owner with an offer he pretty much couldn't refuse. I paid his full asking price, which I deemed, for me, to be not unreasonable. Put 50% down, owner financed the balance for 2 years. I paid a couple of grand extra as "interest". Paid too much-prolly. Got what I wanted-absolutely. Oh, and I also stipulated in the contract that the boat wouldn't leave the general area (N Chesapeake Bay), and I'd pay for the insurance and slip even though it was in the owner's name until paid off. Worked perfectly, owner and I became pretty good friends. A decent broker should be able to pull something off for you.

[The Other Gary]

Since you are in Tennessee I am going to go out on a limb here and suggest that you spend a little time on the phone with Tony Eyls.

He is the Princilple of Watermark Marine Group and a friend of ten years.

He is a broker and as such is paid by the vendor so there is no cost to you and you may just find the answers you seek easier than on a forum,

This is Tony's personal boat that has had the most intensive refit imaginable. He is also well versed in sail. Most important of all is that it is his job to find you acceptable financing and his advice will be worth a lot.

Watermark Marine Group (Harrison, TN)

[Bash]

If you're thinking about a 40'ish boat for $70,000, you're probably looking at boats more than a decade old. The rule is this: the older the boat, the harder to get a loan.

You may actually have more luck on a new boat.

[jpmccros]

Yes I would agree I would have more luck on newer boats for loans...but low probability of finding a 40ft center cockpit that's greater than 1995.

[Group9]

Originally Posted by jpmccros

I will try that out. How would the contract be written out? For example would it be like buyer agrees to pay 50% down payment, and will finance 50% through seller for 3 years. Buyer will resume boat title until completely paid.

If you were selling the boat, what type of contract would you agree to that should protect you if the buyer couldn't make payment?

Federally document the boat with yourself as the lienholder. It can't be transferred without you saying the debt is satisfied. And, put a GPS locator on the vessel. A lot of the used car lots do that around here. You can get the ones that don't cost anything for service until you query for the location of the tagged vehicle/vessel.