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Can't you deduct the interest on a boat loan if it has kitchen and bathroom, like a second home? I think you can do that with motorhomes.
Yes, but can deduct for only 1 "second home". Boat has to have a sleeping quarters, cooking capability and a head. This does not mean a chair cushion, a grill and a bucket.
Feel bad for the OP. $92k debt on your 03 Coastal? I bought my 02 Coastal two years ago for $62k. I own it free and clear.
I am very fortunate to own my boat, two cars, and have zero CC debt. My only debt is the house. Purchased in Sept 09, my down payment was 22% to ensure I maintained some positive equity.
.... That said, I still may finance a boat in the future, but I don't think I'd ever want a long term 20 year loan. I think my max time period would be 4 or 5 years.
Again being typically a cash buyer. I ordered my boat with cash for it in the bank. A deal on a machine (for business) came up before the boat was delivered that was just too good to pass up. So I took out a 15 year note that did not have a prepayment penalty, and I paid it off 3 or 4 months later. Point being, if you plan on a short term loan, a long term note could possibly serve you better. My electric bill is higher than that boat payment was (I forget what it was).
I love boating, but I always thought of boats as a luxury. Why would you finance a toy?
You are glad people do finance their boats. I'll let you think about that for a minute. For some people financing a boat is the only way they can get into boating immediately. Why would financing a toy be any more illogical than financing anything else?
__________________ 2008 Pioneer Cape Island 18/Yamaha 115 2S
1999 Custom Craft 14/Mercury 25 2S
Plastic Navy: Hobie Revo 13, Heritage Redfish 10, Emotion Mojo 12, Field and Stream SOT 12
This actually lends itself to a long standing rule I have when buying any boat...
Why Buy Brand new?
I know that everyone would like brand new, but with transferrable warranties and tons of stock, you can usually pick up any boat you want one or two years old.
With most boats loosing 25-40% of value in the first 2 years it seems buying used is the best value.
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24' Grady White - SOLD!
13' Boston Whaler
A friend, who moved to the Philippines, tried to sell his pursuit for almost a year before he stopped making payments, after taking all his money out of the bank holding the loan. Bank finally took it about six months later. Worked out for him but he has no intention of moving back to the states anytime soon!
A deadbeat, got it.
Makes it harder for everyone else to get financing.
i unfortunatley see this all the time. If you need to sell, get what you can and arrange a deficency loan ahead of time. I am amazed that so many people never heard of a deficentcy loan. Yes, you are making payments but you are protecting your credit at pennies on the dollar.
I love boating, but I always thought of boats as a luxury. Why would you finance a toy?
Never finance a depreciating asset.
Quote:
Originally Posted by Poseidonistaken
Your friend is a scumbag
Quote:
Originally Posted by JAGSARE1
Yes, but can deduct for only 1 "second home". Boat has to have a sleeping quarters, cooking capability and a head. This does not mean a chair cushion, a grill and a bucket.
Quote:
Originally Posted by shark bait uhaha
Yes you can. There is absolutely no law that says you have to use home eq. $$$ for home improvements.
True.
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That is crap.
Which idiot told you that CO2 only makes up 0.039% of the atmosphere?
I purchased my Century 2101 Bay 200 Yamaha for Cash 18k in May 2007 and then took out a loan out on it directly after the fact. I now owe about 12k on it. I believe I could sell it for what I owe If I needed to . If I got into a bad situation and was forced to sell it quickly I could move it for 10k and chalk the small loss up to enjoyment costs.
I'm using this boat and the loan as a learning process and test bed for my next boat and loan which will be considerably more expensive in both initial cost and maintenance. Within the next two years I'm looking to move up to a used 31' CC in the 60-80k range and I'm going to do my homework to try and avoid getting to far upside down. If that means putting 40% down then so be it.
As for people not going to the bank to buy toys, that's fine if it's your thing. I have a friend of mine who's dad is very wealthy and enjoys fishing with us but only owns a 1991 20' Hydrasports that's way past it's prime. He doesn't get out much because the boat beats him up and/or he doesn't trust it in rough weather. I guess here in lies the issue, you either think of boating/fishing as a activity and expense like going to the movies like my friends father or you think of it as an essential part of who you are and everything else you do in life is done with the goal of spending more time on the water.
I fall in the ladder category and can understand why people go to the bank because to us it's not just a toy, in our minds it's an essential part of our lives.
With interest rates as low as they are, I finance my boats. Keep the cash. Once rates start to go back up, will start paying cash again. With low rates come out better in the long run if you put the cash you were going to pay for the boat in a simple investment instead of paying cash for the boat. But most people can not control there money good enough to make this work.
You die-hard CASH guys are so funny. I am all for living within your means. I agree 100%.
But money is still cheap if you qualify. Why would you take money from investments with tax consequences and tie it up in something material. Its better to pay 5 to 6 % on a loan and leave the money invested making more the 5%.
You need money to make money. Having it tied up in depreciating material assets won't do that for you.
I love boating, but I always thought of boats as a luxury. Why would you finance a toy?
So boating should be reserved only for the extreme wealthy, yeah that makes sense.
If everyone operated by your above quote 90% of the boating industry would go under overnite.
Unless your trying to get out........................who cares?...............don't worry about it..................If you need to get out, then plan on writing a check at the closing......................Best thing you can do is forget about it and use it and have fun!
Exactly - you are still paying the same amount for the boat every month and getting the same usage.
The only thing I would add is that if you are that upside down, and need to get out of boating, approach the bank and hand them the keys.
If you are thinking of trading up, and can afford it, then you must be doing well financially, so no big deal.
If you want to trade down, ask yourself why. When you look at it, you will find that your costs to own and operate will go down a lot less than the amount of boating features, functionality and size does. Ride it out - don't buy high and sell low.
I love boating, but I always thought of boats as a luxury. Why would you finance a toy?
Two ways to look at this.
1) If you have the money to pay cash - Because over the long term, you make more on the savings/investment that you retain than the interest that you pay out over the life of the loan. You are always financially better off if you can borrow at a rate lower than your investment return
2) If you don;t have the money to pay cash - Because we were not put on this earth to just work for 45 years, put the kids through college, shuffle off to a retirement home, and check out without enjoying what the world has to offer in the way of joy and passion in life.
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