Its hard to finance right now....

[john232]

It was hard for me to finance a 200K loan with a cash down payment of 50K. My wife has alot less credit background than I do but still had a credit score of around the mid 600s,. My credit score was low 700s. told the Lender that I would be getting a 40K bonus in a month and between my wife and I we bring home over 6K a month and live in a one bedroom apartment and will have only one car payment of 300 a month after we sell are 3rd car. we had some mis- information on our credit report and supplied letters of dispute to the lender but they said to bad, we must get the descrepencies removed entirely from our credit report, and they all so said it would be better if we had a House or more assets. But My job forced us to travel around the country for many years so we never lived in a House long enough to obtain any serious equity. And since we moved back to Texas in 2001 we decided to rent a House untill our youngest Daughter was out of School (which was in the last part of 2006) Now we want to start our dream of getting a Norseman 447 and outfitting it for some serious cruising, and retiring from my job (since I have been there 32 years) and on top of that have I just turned 50, and the clock is ticking. Some People have said the Banks are tighting up since the Housing Market crunch and the rumors of recession are on the horizon, but who knows? The good news is that the Lender said if we do a few adjustments with our credit that we MAY get approved.

[RickBowman]

Get that **** fixed on your credit report. Doing that could help you save in different ways such as auto insurance. Freecreditreport.com can be used 1time per year at no charge. I did it, it's quite simple.
Banks are being much more careful these days, can you blame them? This isn't over yet with the sub-prime slime, and the they are right in the middle of this fiasco.
"A smaller boat with a suitcase full of money beats a larger boat tied to the bank everytime."

[TrueBlue]

I'm not qualified to provide financial advice, but even if financing is approved, if I were you, I'd be very reluctant to bury myself in debt for a quarter million. Especially for a deeply depreciating asset, no home equity and during this declining world economy.

Hell, my home's paid for, no car loans or credit card debt, all kids college loans paid for - and I'd still hang on to my money . . . at least until the dust settles.

[witzgall]

John232;

I agree with TrueBlue. We don't know your entire financial picture, but unless you have, or will have another 250k in assets, you will quickly find yourself boat poor, unable too cruise, or even keep up on the mainainence and insurance of your boat. If you really want to cruise, then find something MUCH cheaper, and be happy with it.

When my wife and I first started shopping for a boat, we looked an much more expensive boats. First boat we visited, and even went sailing on? A 47' 139k asking price monohull.

What did we buy? a 32', 20k Westerly. To buy the bigger boat, we would have had to either sell our house, or use all of our liquid assets, + take out a loan. Now we have a boat we own outright, and are spending the money to get her up to snuff, without it breaking our bank. Have you checked out the prices for rigging on a 47' boat? Bottom paint? I got a quaote for insurance for that 47' boat - $3500 a year east coast only. Ours for the same cruising area is $1200.

If you have not done so already, pick up a copy of "The Cruising Life", by Jim Trefethen. Jim is Opinionated, and I don't agree with everythig he writes, but most of it is good advice.

http://www.amazon.com/Cruising-Life-...3951301&sr=1-1



Chris

[cardiacpaul]

Its not so much the credit report, or the history, its the fact that you're looking for a bank to hook up to 200k for what they "see" as a basically.... 'unsecured' loan. Yea, I know they can take the boat if you don't pay, same as they could a car, but they don't like having "assets". They like cash, and you can't turn a big dollar boat into cash easily.

[camaraderie]

and you can't turn a big dollar boat into cash easily.

Tell me about it!!

[SailorMitch]

Originally Posted by cardiacpaul

Its not so much the credit report, or the history, its the fact that you're looking for a bank to hook up to 200k for what they "see" as a basically.... 'unsecured' loan. Yea, I know they can take the boat if you don't pay, same as they could a car, but they don't like having "assets". They like cash, and you can't turn a big dollar boat into cash easily.

Just like the old joke goes -- they will gladly loan money to people who don't need it.

[hellosailor]

There is no question that some banks have realized they are about to go bankrupt if they keep offering trash loans, but in the meantime you'll still find plenty who are trying to sell homes with zero down payment and the intent of creating more sub-prime trash loans.

Boats are something else, the folks who make boat loans are understandably more reluctant to get stuck with them but they are still in business only as long as they can LEND MONEY. So they are still lending--and eagerly lending--but they are looking twice at who they will lend to.

"Prime" Tier1 customers will have a credit index in the upper 700's, pushing 800. 600's won't cut it. 32 years on one job is great--but being near retirement, with potentionally zero income--runs against you. Moving around can be explained--assuming that's one employer showing 32 years--but again, they are going to look at everything, twice. Once your boat goes out of US waters, if you default it becomes very expensive to find and reposses the boat. And the lenders are also very much aware that some folks take boats out and default on them intentionally--with expensive repo fees to follow.
So, is it harder to get a loan? Yes and no. Harder if you are not Tier1, but those prime customers are still going to get it without arguments--at some of the lowest rates in a long time.
All things considered though, this is still an easy time to go broke and lose everything. Once the investigations and prosecutions and bankruptcies from the subprimes really start to snowball...things may get ugly at a lot of "financial institutions". And, for all of their customers.

[john232]

I plan on retiring with a yearly retirement income of 36K a year from my employer. My Wife and I will be living on the coast and working for another 3 or 4 years trying to pay the boat off early before we take off on our adventure. The Norseman 447 have done practically all the depreciating there going to do and are holding there value at 200K to 240K. Yea the smart thing to do is keep working for another 5 to 10 years hoping are health holds and hoping are dream is still obtainable, but usually most people don't make it and I was always told to go now while you are still young enough or it will never happen. I guess I could put 50K down on a Passport 40 at around 110K or a Passport 42 at around 130K and my monthly payment would go down to about 6 or 700 a month and if we live aboard and work for a few years we could about pay off the loan quicker. Like I said the clock is ticking.

[sailingdog]

One other point... without a house or other significant assets tying you to the USA, a bank is going to look very hard at you, since if you leave US waters, you'll effectively have very little in the way of financial ties to the US, and leave the bank very little recourse in case of default.

Most of those Tier1 customers are going to have assets the bank can go after in the USA, should they decide to default on the loan and take the boat to foreign ports.

One idea is to get a smaller boat, and buy it for cash... and then leave sooner... do you really need a 44' boat??? You might want to also consider that as you get older, your ability to easily handle the weight and size of larger sails, equipment goes down. There is a significant difference between the sails, gear and costs on a 44' boat, compared to a 38' boat.