20 year boat loan

[agallant80]

Any one out there ever do a 20 year boat loan? I know on the smaller boats 10-15 is the normal but when you get up to the 100K mark you start thinking of 20 year and viewing it as a house. So my question is has anyone ever done a 20 year loan and what are your thoughts on it?

 

[aspeck]

Re: 20 year boat loan

Not me, and never would for a luxury item. But that is just the way I am made.

 

[korygrandy]

Re: 20 year boat loan

What else would prompt you to lock into a 20year financial commitment? I don't even want that on a home mortgage. Boating would really need to be a big part of your life to make that sort of financial commitment.

Now don't get me wrong if they're offering a 2%APR I might consider it, especially since that means I could get about 3x the size boat I have now but I still wouldn't be able to afford the gas.

Even most private equity investors are in and out in 5years and a boat is certainly a far cry from an investment.

Final answer, No I wouldn't do it.

 

[Bob_VT]

Re: 20 year boat loan

20 years on a depreciating asset........ I would not do it.

 

[Limited-Time]

Re: 20 year boat loan

I know several people that have and have never looked back. They enjoy the boating lifestyle and view the payments as the cost of their pleasure. One couple even claimed it as a second home as were able to write off the interest as such. But I also know a couple that bought a second hand Cruiser, payed cash and never found the enjoyment they thought was to be there. They ended up selling the boat as a loss rather than pay slip fees for a pastime they did not enjoy.

 

[tpenfield]

Re: 20 year boat loan

Cash is king . . . depending on how much down payment you put into it . . . but taking on a 20 year loan for a $100K item that will be worth $30K in 10 years is pretty scary.

That $100K boat (loan) will cost you about $160K and you would have to earn about a quarter-million $$$$ before taxes to pay for it.

You will not be able to sell the boat for the amount of the loan balance due for many years . . . 10 -15 years probably. (upside down scenario).

That is why I don't believe in long term loans for items that should be considered a 'luxury' and not a 'necessity'.

 

[roscoe]

Re: 20 year boat loan

20 years on a depreciating asset........ I would not do it.

Make that a depreciating liability.



The only way I'd even think about it, is if the boat was my source of income, as in a ferry, tour boat, or commercial fishing vessel.

 

[coastalrichard]

Re: 20 year boat loan

Cash is king . . . depending on how much down payment you put into it . . . but taking on a 20 year loan for a $100K item that will be worth $30K in 10 years is pretty scary.

That $100K boat (loan) will cost you about $160K and you would have to earn about a quarter-million $$$$ before taxes to pay for it.

You will not be able to sell the boat for the amount of the loan balance due for many years . . . 10 -15 years probably. (upside down scenario).

That is why I don't believe in long term loans for items that should be considered a 'luxury' and not a 'necessity'.

So true...the numbers don't lie!

Make that a depreciating liability.



The only way I'd even think about it, is if the boat was my source of income, as in a ferry, tour boat, or commercial fishing vessel.

Can one make an income?

 

[NYBo]

Re: 20 year boat loan

Odds are if a boat is big and expensive enough that you need a 20 year loan to buy it, you can't afford to feed and maintain it.

 

[bruceb58]

Re: 20 year boat loan

I wouldn't get a loan of any length on a boat. That's just stupid.

 

[smokeonthewater]

Re: 20 year boat loan

No way No how Not in a million years.... MAYBE if I knew I was gonna die in 6 months.....

If I can't buy a toy with cash, I can't afford to be buying toys.... take that monthly payment and put it in a savings account until you can afford to buy a toy.

 

[bruceb58]

Re: 20 year boat loan

If I can't buy a toy with cash, I can't afford to be buying toys.... take that monthly payment and put it in a savings account until you can afford to buy a toy.

^^^^^^ +1

 

[tazrig]

Re: 20 year boat loan

Wouldn't do it either. It's not just the initial 100K outlay it's all the maintenance and repairs that start right around the 5 year mark and keep increasing in ADDITION to the monthly payment that will sink you!

 

[southkogs]

Re: 20 year boat loan

I'll just add another "no" log on the fire ... Look at 10 year old comparable boats on Craigslist and see what the ACV is on the rig. Then calculate principal and interest where you would be in 10 years on a loan ... should scare the Dave Ramsey outta' ya'.

I'm with Ted:

Cash is king . . .

 

[Bob_VT]

Re: 20 year boat loan

Make that a depreciating liability.

Ooops yup liability!!

 

[theBrownskull]

Re: 20 year boat loan

I don't know if I would commit to a 20 year loan, but life is short. It depends on the interest rate and if you can pay it off early. If the payment is low then who cares...just like any other payment. By the way has anyone seen the cost of college or braces. How can one save for that.

 

[trendsetter240]

Re: 20 year boat loan

My buddy just did exactly that but he did it on a 10 year loan. He can easily afford the payments and wants to have this boat for the next 5 years while his kids are young and for it to be a part of their family time in the summer.

Interest rates are rock bottom right now and if you can afford the payments, properly maintain the boat and use it enough it can be a good choice.

 

[MH Hawker]

Re: 20 year boat loan

I looked into a 80 foot summerset house boat a few years ago as a second home and the payments went all that bad. but the slip space and insurance was out of sight.

 

[H20Rat]

Re: 20 year boat loan

I would be so sick to my stomach with a boat loan that long! Plain and simple, but if you need a loan that long, you can't afford the boat. Anything that thinks otherwise loves to give money away. Personally, unless you are living on the boat, you shouldn't take out ANY loan, period. Buy cheap, buy small, and then save up for the next boat.

 

[bruceb58]

Re: 20 year boat loan

An even dumber thing to do is take out a home equity loan to finance boats or cars. I have a few friends that did this and are stuck with 6 and 7% loans on their first because they have no equity in their home anymore due to the home equity loan and can't refinance.