How does financing work -

[5280Hawk]

when you are purchasing a boat from a private seller??

My max purchase price is 20K and i plan to have 3K down. I saw a great boat on craigslist from a private seller, so how would/can the financing work?

 

[mthieme]

Re: How does financing work -

You go to the bank and borrow $17K.

 

[5280Hawk]

Re: How does financing work -

But do they want to title to the boat first?

Will the bank use the boat as collateral for the loan?

what about percentage rates?

 

[rockyrude]

Re: How does financing work -

The first hurdle is to get the bank to loan on a boat, then it needs to be appraised (usually by the bank) to see if it's worth what you say it is. They MIGHT give the loan on the promise you surrender the title to them because yes they use the boat as collateral. Rates are whatever you can get.

 

[lowkee]

Re: How does financing work -

It works the same as a car loan. You go to the bank, get pre-approved for a set amount and when you find the boat you want, you tell the bank, they write a check and you bring them the title.

It has been a loong time since I've taken out a loan, so this may have changed, but when I bought a used car, I got a 'blank check' from my bank, which was a physical check I could fill out *up to a certain amount*. I bought the car I wanted and they instantly had that car as collateral, just from my using that check to buy it.

I was guess percentage rates are the same as if you bought a used motorcycle (or any other luxury item), high.

 

[jacknbella]

Re: How does financing work -

Boat loan rates are typically more than auto loan rates. I've seen boat loan rates as low as 6% for newer models, where as, auto loan rates can be as low as ZERO %. Of course, the market changes everyday so you might find a "steal" somewhere too.

 

[Tuna Van]

Re: How does financing work -

Shop around for the best rate at banks and credit unions, but like jacknbella said - a good boat rate is like a bad episode of Family Matters, it doesn't exist. I would have a hard time financing $17K on a $20K boat. Save your money bro and buy something cheaper.

Tuna

 

[Edko]

Re: How does financing work -

You can get a home equity and deduct the interest, if possible.

 

[mthieme]

Re: How does financing work -

That's a good option. I bought my wife's car that way.

 

[Bob_VT]

Re: How does financing work -

We have a whole bunch of us that have worked in finance in a car dealership..... including myself. Before you shop I would visit the bank or credit union and find out what you have the ability to do and their procedures...... everyplace is just a little different.

I would not do a home equity on a depreciating asset.

 

[mphy98]

Re: How does financing work -

sent you a pm

 

[Mike722]

Re: How does financing work -

Bob VT what is your reason for not wanting to do a home equity? Like Edko we use are Home equity loan for all our cars, and improvement at the lake. Current rate is 3.99% and the interest is tax deductable. The only problem I see is that most are adjustable rates and you have to be prepared and have the ability to refinance if rates would take off.

 

[5280Hawk]

Re: How does financing work -

Thanks everyone for your responses,

Follow up question?- (GETTING AWAY FROM BOATING THOUGH)

How do I shop for rates with out have the creditors running my credit a bunch of times (thereby effecting my cerdit score)

 

[cdnfthree2]

Re: How does financing work -

Bob VT what is your reason for not wanting to do a home equity? Like Edko we use are Home equity loan for all our cars, and improvement at the lake. Current rate is 3.99% and the interest is tax deductable. The only problem I see is that most are adjustable rates and you have to be prepared and have the ability to refinance if rates would take off.

I'm not Bob or a financial expert but I'll take a stab at it. The rate could take off like you mention. Also, if financial trouble arose you won't be able to sell the boat for anywhere near what you paid for it new. If the bank were to call the note you'd be living in the boat or taking a big hit. I have financed nearly every car I ever owned although it doesn't really make any sense to finance anything the depreciates a fast as a car. Unless you rich though u have little choice.

As for shoppping rates, I've never had my score drop more than 5-8 points that I'm aware of due to inquiries. I realize that 5 points can be a deal breaker in some situations but once I got a house a really stopped caring about little things. It comes back quickly.

 

[Tuna Van]

Re: How does financing work -

You can look at rates on banks websites or by calling. If you have good credit your rate will most likely be close to that. Find a couple places with the best rates and then see what you can get. A couple credit checks isn't going to affect your score that much. Plus this is America. We don't worry about credit scores. Just keep in mind that a good rate on a boat is like a bad HJ...it doesn't exist

http://www.bankofamerica.com/vehicle_and_personal_loans/index.cfm?template=boat_loans

https://www.suntrust.com/portal/server.pt/community/rate_terms_marine/547

https://www.gfcuonline.org/loansandmortgage/rates.asp

 

[5280Hawk]

Re: How does financing work -

Just keep in mind that a good rate on a boat is like a bad HJ...it doesn't exist

LMAO!!