Catamaran: Advice on a Dream---Ealy Planning

[LoufromFWB]

Cat-Cruisers, how was your experience?------Just looking for some input on this dream of mine, and many others I'm sure, so hopefully your input will help many others too. I'll try and make this as concise as possible. But first, I'm sure some will believe this is a pipe-dream while others will give me encouragement, and though I want all input I would like to hopefully get some sound advice from either experience or knowledge, even pointing me in the right direction to find it. Let me put it this way---I do have backup plans (going a much cheaper route) but the fact is I will have a boat, no matter what---I just would prefer my "dreamboat." Anyway, enough with the speeches. Here are the specifics. The plan for purchase is around 2, maybe 3, years (retirement age)---so about 2019, and the plan is living and cruising on this boat. The boat (type) I desire is a catamaran, either a Fountane Pajot or Lagoon in the 42-45ft range, currently seen as low as $250,000, but most much much higher. For this post let's say that somehow I found or was able to talk down the price for financing down to a ridiculously low $200,000---again, most boats I've seen are in the $300-$400K range (under 10 years old is desired); so the standard 20% down payment for financing would be 40K. Now here's a little about me. I will have only 2 sources of retirement (secure-military, etc) income which total about $3000/mo (status-single). Any other income (and there will be some) will only come sporadically so I'm not sure this can be counted on for this "experiment." Now here's another issue: my credit history has been poor. This being said I am working on at least doing some repair on this, and my guess is that at least there will be nothing there too derogatory within 2-3 years (purchase date), and hopefully even a few things of a positive note. So for credit let's just say it'll be in the "ok" range. There's nothing major there, which is actually a negative I believe---so my history is more in lacking than in non-payment. Now here's my thinking. If my credit is "ok," but income will not be that high (though higher than many others I'm sure) for what I am attempting, the higher I go with a deposit will make it easier to acquire that financing. That makes sense right? But here the question arises, how much higher? I will have at least $60,000 for deposit---but is this enough to make this specific boat purchase dream come true? I think "they" will do anything to get this deposit money---am I right? Now obviously I need to take into account money needed for living, repairs, etc. So what do you think are my chances in acquiring financing with a 30% or more down payment on such a catamaran? Is there a minimum retirement or income you think I should have for this to be a reality (as a single person)? Like I said, I do have backup plans, but it would be so awesome to make this dream a reality. Please no comments on the boat is too big, etc. Let's assume I know how to handle it and this is the only boat type/size for this discussion. Thank you.

[Dulcesuenos]

Contact your lender for specific details and buc value, your down payment can change wildly.
Example, you find a boat negotiate for 200k. Lender says 20% deposit. Then oops we only loan 80% buc value. Buc value on your 20ok boat could be 180 could be 250. Survey may say less or more. Your 40k deposit could become 80k real fast or the deal falls thru as they now will only lend 160 so you need 32k for them and another 40k to close the gap. Buc value makes no sense and they dont care as they have their own senseless guidelines they follow. If you liveaboard its even tougher, best off with a credit union and shorter term loan


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[geoleo]

Your income is not enough to get a boat this large. They know Insurance and docking costs will "eat your meager income up. So I will say what you have said you don't want to hear. Get a smaller older boat!

[geoleo]

Hint--There are boats such as the well regarded Lagoon42TPI that are selling for 119K to 180K.

[GordMay]

Greetings and welcome aboard the CF, Lou.

[captainjay]

In the current lending climate in the marine industry you will not get a mortgage. With great credit good income and excellent credit history can be difficult. If you don't have a house or some other asset to borrow against then start saving cash because that will be your only option.

Jay

[valhalla360]

So you are looking at a reliable income of $36k/yr.


I haven't pulled up the interest rates but you are looking at minimum $2k/month for the mortgage payment.
Figure maybe $6k for annual maintenance (doing a lot yourself).
Another $2-3k for insurance.


That leaves you $3-4k for all other living expenses. If you want to stay in a slip, you probably are in the hole before living expenses.
Pretty much anything goes wrong and you are missing payments. Luckily, the bank will likely derail your plan before you put yourself in bankruptcy.

[SVNeko]

With a loan you'll be tied to a dock and a job. Much better to buy what you can outright and get out there.

[Bulawayo]

Originally Posted by geoleo

Hint--There are boats such as the well regarded Lagoon42TPI that are selling for 119K to 180K.

Second that......

[Fibonacci]

My advise - as a retired Financial Planner/advisor is: to only buy what you can afford (based on the capital you have). Once you are retired, only buy what you can afford. You will have many other unforeseen expenses that will eat away at your retirement income.

[duefocena]

Suggest talking to lenders now and get a feel for what will be necessary. Maybe go on creditkarma.com and read what it takes to improve your credit status, ( you can do this in the next couple of years).
Disagree with those telling you to look at TPI's ( I have one ), as they are too old to finance ( 10 years max usually ). A nice Lagoon 380 in the two's a few years from now is feasible.
Current interest rates here are 4.75% so what will they be in 2019? I'd factor in an additional $500 per month to be safe.
Go to some marina's and get a feel for rates as well as where you might keep her, even temporarily, prior to you dream trip.
I'd remember that the cheap can turn out to be more expensive.
Good luck, this is my 5th catamaran and I've had naysayers at each purchase so don't be disuaded.

[Scaramanga F25]

3K$ a month! Think 32 ft monohull paid in full and ready to go.

[Bulawayo]

Originally Posted by SVNeko

With a loan you'll be tied to a dock and a job. Much better to buy what you can outright and get out there.

As the ex-financial advisor says as well.......buy what you can afford allowing for some maintenance etc and use the 3k per month for what its intended. This is sufficient for many people per month whilst considering some shall need to be saved against future expenses as well as anti-fouling, insurance etc etc plus the unexpected issues and for the upgrades shall creep in. Paying finance charges each month on a limited income is likely a very slippery slope.

[captlloyd]

A 37-38ft cat is plenty big enough to live on. About 3 weeks ago a cat of this size was listed on the forum for $40,000. It has been setting on the hard for about 6 years. If I would have had 40 grand setting around I would have bought it myself. Deals are out there and you have time to look. By the way, that cat was immediately sold, does anyone know if a forum member bought it? I would like to know how the restoration is going. I think that cat was a diamond in the rough.

[Scout 30]

Time for a reality check! With $60k to spend & $3k a month to live on you are in a great position to retire on a boat that costs $30k. There is nothing wrong with that. That leaves you $30k for repairs/upgrades & hopefully a little in the bank. Start looking at older monohulls in the 30 to 40ft range now. The more you look the more you know. For $30k you can find a good boat well suited to living aboard in decent condition.