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Posts: 1316
Location: Madison, WI | Need some help finding the cheapest interest rate for a boat. I'm working on TRYING to purchase a boat for next year. I've contacted a few banks and the interest rates are anywhere from 8.5-12.5 depending on credit rating. I know i have a solid credit rating so i'm banking towards the lower rates, but they still seem alittle high. At 8.75 over a 5 year loan i'll be paying $1720 which is just crazy!!! Where did you go for $$$? Did you find rates lower going through a dealer or bank?
Edited by Magruter 10/16/2006 8:45 AM
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Posts: 1316
Location: Madison, WI | What type of extra costs can i expect?
Insurance ~150
Towing package for car ~250
Registration???
Anything else? |
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Posts: 434
Location: searchin for 50 | Try joining a credit union they usually have cheaper rates than banks do without all of the fees. |
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Posts: 13
Location: Northwest Chicago suburbs | Hey Magruter,
Do you have a 401k?
On most , you can take a loan (up to 50% vested) from your plan and pay yourself back with interest.
Did that with mine and I will pay myself back this February.
So now that I will officially own my boat does it mean I need to buy a new one?
Decisions, decisions. |
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Posts: 21
| Tapping your 401k for a boat????
Not a good idea. You're losing the money you can make on the principle. In the past few years, if you have a good investment, that can be in excess of 20%.
If you can't get a home equity loan, take out the boat loan at 8.5%
Better yet, save some $$ and pay cash.
Ubuck |
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Posts: 147
Location: WI - Land of small muskies and big jawbones | Borrowing from your 401K to buy a boat is a not a good idea. Eventhough you will pay back your 401K with interest, the money you borrowed from it was pre-tax dollars that you will now have to pay taxes on and the money you will pay it back with will be after-tax dollars. This means you are actually being taxed twice on the same money. Not to mention any interest you would loose on the money you took out had you just left it in your 401K instead. Ask any credible financial advisor about borrowing from your 401K to buy a boat and see what they tell you. I would shop around for the lowest interest rate you can find and take out a loan from a financial institution.
Edited by Lockjaw 10/19/2006 7:12 AM
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Location: Minneapolis, MN | Depending on what state you live in, you will pay upwards of 6.5% sales tax on a new boat. Many states have no sales tax on used boats and there are many used boats in great shape at a substantial discount to new. No boat is worth going broke over unless it comes with the girls I see in some of them  |
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Posts: 5874
| Fortunately, we live in WI, and get to pay sales tax on any boat we buy, new or used. What a scam! If a boat is sold 5 times, they collect sales tax on it 5 times. Same with vehicles. I ask the candidates about this every election for Gov. All of them say this needs to change, none of them are willing to change it.
Buy a used boat in MN, and leave it registered there. No sales tax that way. |
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Posts: 1316
Location: Madison, WI | So far my bank is offering the lowest rate at 7.25% I'm trying to keep my payments down to $100 bucks a month. So I'm looking at a 5 yr loan for $5000. Which after all said is done i'm paying over $6000 for the boat with interest. I just can't justify in my head dropping an extra grand when i'm borrowing 5000. Then Tax!!! I didn't even think about that. If the boat is priced at $5000 that's an extra 275 right there. But if i'm going to move i have to move fast, looks like the interest rates are doing nothing but increasing.
A home equity loan is alittle out the question, they want a minimum of 10000 dollars. According to my mortgage broker I can write off the interest which would be nice. |
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Posts: 1769
Location: Algonquin, ILL | 401K Loans, The way this works is that you are not Taking Money out of your 401k but using your 401k as collateral, You pay back the amount borrowed plus interest usually lower than a Banks, Now if you Fail to pay you will be taxed at the regular rate on the amount remaining PLUS a 10% penalty, In short using your 401K can work to your adavantage just check with you account manager for the details
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Posts: 147
Location: WI - Land of small muskies and big jawbones | Shep
Can you register a boat in MN when you live in WI? Is that even legal? If it is, please tell me how to do it because I am planning on buying a used boat from MN in the next few weeks. I live in WI but fish in MN as much or more than I do in WI. If this is a legal way to avoid paying sales tax in WI on a used boat that would be great. Having to pay sales tax on a used boat is a scam I would like to avoid if possible and legal. |
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Posts: 2865
Location: Brookfield, WI | Scott, typically a Home Equity loan is a line of credit. They'll want you to have the $10,000 line, doesn't mean you have to use $10,000. Interest is payed on what part of the line of credit you spend. Call Don Caveney @ U.S. Mortgage. (414-431-4111). Tell him Kevin Dunn told you to call. Tell him EXACTLY what you want to to do. He might not have a program for you as he does mostly first mortgages, but he'll tell you what your options are.
Don is a one man mortgage company. I've been dealing with these type of people for seventeen years, and he is the most honest and straightforward guy I have ever dealt with in mortgage lending. He got two guys I know that were having serious financial problems into loans, and he did not gouge the crap out of them in the process.
Oh, and tell him you know me from musky fishing. He's an outdoorsman himself.
Kevin |
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Posts: 5874
| I'm not sure how to register it in MN. Probably all you need to do is carry over the existing registration? I heard it here, so maybe do a search? |
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Posts: 42
Location: Shoepack | My suggestion - get a loan for a $20K boat. Pay it off over the next 5 + years. Spending $100/m for an old, underpowered boat versus $210 for a sweet ride is a no brainer.
The Midwest is full of guys owning $5K boats that wish the boat would go away. Don't be one of those guys!
Regardless - make sure you get a great deal on the price of the boat. A huge discount on the boat will easily offset all interest charges.
Just my two cents - I don't know everything... |
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Posts: 434
Location: searchin for 50 | Hey and don't forget life jackets, fire extinguisher,a oar or 2. Locater or graph, trolling motor, rope for unloading and loading. I'm sure there is more. |
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