Buying New vs Used

06Rinker270

What would you say the average life of a boat loan is?  

Handymans342

15 to 20 years or Cash if you are MT

06Rinker270

I am dreaming of a larger vessel which is what prompted my curiosity.  But that wont be for a while.  

Handymans342

You dreaming of what?

LaRea

Yeah, 20-yr financing is common for boat loans over $100K.  Some banks offer 30, but you'd be crazy to do 30 on an express cruiser.  

craigswardmtb

10-15 seemed normal when I did mine.  I did 10.  But it was low dollar compared to most boat loans, from what the broker conveyed.

Michael T

Can you guys still write the interest from your boat loans off as a second "home" mortgage if you can sleep, cook and the boat has a fixed head? Up here we can't :-(

raybo3

yes I claim mine..

06Rinker270

Wait...say that again?  You can claim the interest!?

Handymans342

Yes. If you need the IRS rule PM me as my admiral is a tax accountant

Michael T

It sure cheeses me off that we can't do that here in Canada. It would sure save the boaters a lot of cash!.....Wait, am I now a Certified Rinker Financial Advisor (CRFA)???? LOL

craigswardmtb

Yes you can write it off however if you have a 2nd home with mortgage interest that you deduct than you cannot. Pick the greater of the two. 

JoeStang

To answer the original question I'll chime in.

I ended up buying new from the Detroit boat show in 2013. I paid $62k out the door for my 276 cuddy with a couple options. Not loaded, but not bare bones.

I got 2.99% interest for 15 years, so the payment is very reasonable. And yes I can deduct the interest.

I had been looking at similar boats in the 26-29' range, and they were all either $50k+ for 3-5 years old (and no warranty), or 10+ years old and $27-$35k.

The hours and condition ranged, but the main reason I went new was because of the payments. On a 10+ year old boat I could only get like 7.99% and 10 years max. So the payments ended up being very close between new & used. So, it didnt make financial sense to risk an outdrive failure, electronics issues, or having to spend thousands to replace canvas or carpet when I could just buy new and have it all done.

I have 5 years warranty on the engine/drive, and various coverage 1-5 years on the rest of the items on the boat. Hull is lifetime, and I got great dealer support with the couple issues I've had.

Now, that was at the absolute top of my price range, and if I was looking at a 280EC or similar it would have HAD to be used. But every situation is different and I wont "outgrow" my 276 for at least another 5-7 years, which by that point it should be positive or at least even equity with the loan.

JoeStang

Also insurance was much cheaper for my boat being new, only $355 a YEAR for BoatUS with an agreed hull value (non-diminishing) and vanishing deductible.

gtyee

Home equity loans can be written off  taxes with a lower interest rate and the principle can be paid down to save on interest money. Also a whole life or universal policy can be turned into cash and you can buy a term policy (with good health) for less money due to the lower term rates due to people living longer. Whole life, universal. or cash value policies have a much higher cost of insurance compared to term life. Ask your insurance agent or check rates on line to save more. Last but not the least not all kids need college! LOL.. I have three in college right now. ugh!! Its retire now, work later.

06Rinker270

On a 100k boat, lets say a 2004 410 for just a nice round number.  What would you think this boat would depreciate a year?

LaRea

Assuming it has been well-maintained with no damage, I'd say 4-5% per year.  

I owned my 342 for ten years, and kept an eye on prices of used boats during that time.  Based on that "data," here's how mine depreciated each year:  15%  12%  10%  9%  8%  7%  6%  5%  4%  4%

Of course, I only have two real data points -- the purchase price and the sale price after 10 years.  

LaRea

Of course, a lot depends on the owner and fresh vs. salt water.

Dream_Inn

Patrick, I've usually seen the best bang for the buck is around the 4-5 year mark.  If you get a used boat around that, it won't depreciate a whole lot (it's typically less than half the original 'paid-for' price) and the boat isn't so old that you have tons of problems.  The 'problems' start near the 10 year mark.  That is when things, like hoses, need replaced.  Just my opinion.

Handymans342

Patrick, what LaRea forgot to mention that if his 342 had diesels, it would be 15% 0% 0% 0% etc. LOL

06Rinker270

Interesting and appreciate the info.  I thought my 2006 was new as I came from a 1995.  What a world of difference that made.    

Chris, to have a starting point, was your 342 new?  I really like those models.

raybo3

Handymans342 said:

Patrick, what LaRea forgot to mention that if his 342 had diesels, it would be 15% 0% 0% 0% etc. LOL

Handy no market out there for big very slow boats.........lol

Handymans342

Really Ray, really???  Lol

LaRea

Yes, I bought it new in 2003.  I hit the half-original-price point after six years (not accounting for inflation).  But those were six glorious years!

raybo3

Handymans342 said:

Really Ray, really???  Lol

LOL OMG that is too funny. That is a saying I use all the time. How did you know?...LOL

06Rinker270

LaRea I bet they were glorious years.  From the amount of time you had the boat sounds like you really enjoyed it.  Lately we have been looking for what our next boat would be and the 342 is one of my favorites.  I was not aware that there are so many different models throughout the years, rarely stays the same.