Financing Thoughts?

[CBedo]

I'm getting close to pulling the trigger, and wanted to get you guy's thoughts on financing.  I'm planning on putting down about ten grand, and then financing the rest for 15 years, although I assume I'll pay it off in 5 or less.  But I figure going out fifteen, if for some reason, I have a tight stretch, I should easily still be able to make my payments.

Any thoughts on who to finance it with would also be appreciated.  I hate my bank!  Has anyone used any of the internet resources?

Thanks for everything

[CBedo]

Also, I am exploring a home equity loan since that interest will be tax deductible.  

[J._Bricker]

CBedo the home equity loan would be the way to go, let your money work for you plus the benefit of a tax deduction.  Just my .02

[settle1]

yea home equity loan or join a credit union....but you cant beat the tax deduction

[Madhouse27]

I guess I am more from the Dave Ramsey school of thought. I'm not into financing anything. Have you thought about finding a great boat for the ten grand you currently have and running that for a few years while you save more money? Then you could sell the boat and step up to a 15 grand rig etc and would never have a payment and your boats would continually get better. I certainly don't have a problem spending money and buying cool stuff, I guess I'm just not into buying on time regardless of how sweet the deal is or how low the interest rates are.

[CBedo]

I guess you have two points, Madhouse.

1) Would I be happy with a ten grand rig.

Answer:  Probably not, I want a big monster (with warranty) with a big front deck to fish team tourneys.

2)  Should I buy "on time" as you say?

Answer:  Financing is better than paying cash, if you have better alternative investments.  Even though I will finance this thing 15 years, I expect to pay it off in 5 or less.  If over that five year period, I could make more money investing somewhere else than what the loan costs me, then it makes sense to finance (as long as you still have financial flexibility and are not overextended).

And I do expect that, so this is not a question of whether or not I will finance, but HOW I will finance.

I do understand what you're saying though, and appreciate the thoughts.

[DDbasser]

Cbedo

The home equity loan would be the best deal.

Because you can deduct the interest.

I had thought about going that route on mine but I didn't have enough equity in my house so I financed it through Commerce bank, that's the bank the dealer I bought the boat from recommended.

My interest rate was a little higher than I would have liked, but I really wanted the boat.    

[Big T]

Excuse me for my last reply I was having computer user problems, I would think that a home equity loan would be the cheapest way to go as far as interest goes.  However I think I migth be more inclined to buy a cheaper boat.  Nitro has some pretty decent boats for around $15 to 20 grand. I would put down my $10,000 and finance the rest with a credit union for five years, I don't think I would like to use equity in my house for a boat.

[Sam]

Take some time and visit three or four local banks to get their financing advice and interest rates.

I financed my boat through United Services Automobile Association (USAA).  However, this is an insurance company for military officers and NCOs only so you may not be able to use their services.

Ask the bankers about the interest situation when using your equity line. Make sure their is an IRS tax deduction and if you have to itemize your tax return.

The boat dealer has financing so when you walk in to make your purchase you need to have all financing set up so you can 1) compare the dealer's rates and payments with 2) the most favorable approval you have received from your local bank.

Buy that boat!  You will never regret it!!!

[Smib]

Just my 2 cents but this time of the year (Oct thru Jan) you can find some really good deals on used boats.  There are alot of nice looking 20 rigs out there for 13,000 or less.  I agree with Madhouse, don't go crazy with your hard earned money.  Punch in "used bass boats" on google or yahoo and I think you'll find something you'll be very happy with, I did.    

[flechero]

CBedo,

You seem to be pretty estute regarding your finances and are fortunate enough to have some options.  Here are a few thoughts, or options.  

I would only question your 15 year strategy.  If you plan to pay it off in 5 years, why go 15?  If you feel the need for safety in a tight stretch, maybe just go 8-10 yrs.  I say this because very few people can stay disciplined enough to stick to paying extra when they have it.  

Or, if you forsee a tight stretch, maybe you should reconsider the used boat... you'd own it and never be worried with payments.  Besides, I don't know a single person (me included) that bought a new boat first and got all the options right for long term.  And, it's hard to top the new boat later.

you said " Financing is better than paying cash, if you have better alternative investments.  Even though I will finance this thing 15 years, I expect to pay it off in 5 or less.  If over that five year period, I could make more money investing somewhere else than what the loan costs me, then it makes sense to finance (as long as you still have financial flexibility and are not overextended). "

If you have an extensive investment portfolio, and can do all of that w/o being overextended, do you really even need to finance it?  You could buy it outright and take what would have been your expected payment (on the 5 year schedule) and invest that.

I can't suggest a bank, the last boat I financed was with John Deere Credit and they don't do boat loans anymore.

I'm just thinking "out loud" here.  Figure out what makes the most sense for you and by all means... wear that new boat out!!

Good luck and enjoy shopping!