Performace boat loans!!!!!!!!!!!!!

[WMF]

I feel that the banks( goverment) are going to kill Perfomance boats. They will no longer loan money based on credit score or value of what you are buying!!!!, they are now looking at stated income and cash in bank!!! Most performance boat owners are business owners and dont show all thier income!! or have tons of chash on hand!!! or cash they can show!! I know for a fact that you can have no more then 42% debt to income, and have to have as much in the bank as the loan values to get a boat loan and 15-30% down!! I rember the days when credit score and the value of the item was the most important items!! I dont know what the performance boat manufactures are going to do to fix this problem, but thier are alot of buyer that are being turned down right now based on these facts!! I am one of them. I feel the boat manufactures need to start thier own Financing companies to sell thier boat!!! or thier needs to be a good bank started to sell boats, RV, and all toys for adults!!! If not we will see the complete destruction of our hobby!!!!!! I have alot more to say but really dont know how to put it in words.

 

[Offshoredrillin]

totally agree, the honest guys that own business's cant. I quoted that e letter that went around to my assistant. She was let known that if my taxes go up, I will not take a pay cut, she will be unemployed. she honestly thought i was joking, I havent invested years and tons of money to let it be taken away. The banks are just nuts, like its our fault they gave gov enforced loans.

 

[Audiofn]

The problem with looking at the current value of things is that the values in the economy are dropping like rocks. A boat that you may have paid 120K for just 2 years ago is now selling for 60 or even less.

I agree this is going to put a hurting on boat sales. I see more and more people putting 2nd mortgages on their houses just to make it happen if they need to do so. I also see the price of boats dropping even more then they already have.

 

[getchasum111]

i didn't think that second mortgages were even available anymore.....

 

[Davidmnc]

From the RV side. Several years ago Fleetwood RV decided to start there on financial services. They were the bank. This ended up being a loosing proposition so they sold out to GE. Now Thore is going to try this type situation again. We will see if it works or not, but if it does it will be a model for other manufactures to do the same. I don’t think many performance boat companies can afford to do financing in house when they are barley hanging on to begin with.

 

[cigdaze]

Hate to say it, but banks tightening up is a good thing. Sucks for the guys who can't prove income, but in reality why would I risk loaning someone money who can't prove to me that they'll make money this year....That's what got us into this mess into the first place, isn't it? Secondly, let's face it, a boat isn't exactly a necessity...and when things take a turn for the worse for most folks the boat, RV and toys are the first thing they'll stop paying; most people would rather keep the house than the boat if forced to choose. Thirdly, with all the boat biz scams and illicit dealership practices of late, it's no wonder that lending institutions are hesitant to loan on a boat. Lastly, it just doesn't make sense for lender to buy a boat for the client (borrower) when that boat will be worth about 1/2 of what you just paid for it in 12 months - talk about unsecured debt.

 

[cigdaze]

I rember the days when credit score and the value of the item was the most important items!!

I think this sentence deserves it's own highlight.

I think this recession and the current state of affairs has proven beyond a shadow of a doubt that credit score simply isn't a good indicator of a person's willingness or ability to pay off a loan. Also, I think we've more than shown that the value of something doesn't mean sht anymore. Real Estate's down 35% in recent years, and boats...forget it. Not many saw that coming, if they did, the lending should have stopped years ago.

 

[MANITIE]

It will not get better anytime soon....banks are still lending on cars even on secondary loans they are buying deep.....but if you talk to any banks that have taken a big hit...its the ones that were doing stupid loans in the first place....the banks that have been sticking to there guide lines are still in the game.....GMAC and Chrylers Fin. have taken a big hit in financing there cars....and with a bad economy there defults went threw the roof.....so I would think the boating industry getting into in house will be a hudge risk....there losses on a defult loan would be 10X on what a car loan defult would be......the differance is with most good banking practices there defult rate is under 10%, some as low as 6% they can sell there paper after 6 months to a year...some will whole the note for the term and turn a good profit....but on 5 boat loans...1 bad boat loan could wipe out all profits in one hit....and in most cases, a person will let there boat loan go before there car everytime....BOA has a good recreational loan division but they will ask for POI 75% and they will require you for a good % of down payment..... and thats why they are still in the game....

We have all seen with buying shadey paper dose..... it will be a long time before banks go back to that practice if they even attempt it again....they are all going back to there old guide lines...

income to debt:
a good down payment:
and proof of income:

 

[Offshoredrillin]

Hate to say it, but banks tightening up is a good thing. Sucks for the guys who can't prove income, but in reality why would I risk loaning someone money who can't prove to me that they'll make money this year....That's what got us into this mess into the first place, isn't it? Secondly, let's face it, a boat isn't exactly a necessity...and when things take a turn for the worse for most folks the boat, RV and toys are the first thing they'll stop paying; most people would rather keep the house than the boat if forced to choose. Thirdly, with all the boat biz scams and illicit dealership practices of late, it's no wonder that lending institutions are hesitant to loan on a boat. Lastly, it just doesn't make sense for lender to buy a boat for the client (borrower) when that boat will be worth about 1/2 of what you just paid for it in 12 months - talk about unsecured debt.

I don't disagree with anything you stated. That is one of the delimas being a business owner. You have a choice of how you disperse the funds. the sad state of affairs is that many people were using their homes as ATM machines.

and for the "pot meet kettle" comment that was posted then removed...whatever... I have never asked for anything that I haven't earned or worked for. That includes taking chances to build 2 companies from scratch.

 

[sellsman11]

Hate to say it, but banks tightening up is a good thing. Sucks for the guys who can't prove income, but in reality why would I risk loaning someone money who can't prove to me that they'll make money this year....That's what got us into this mess into the first place, isn't it? Secondly, let's face it, a boat isn't exactly a necessity...and when things take a turn for the worse for most folks the boat, RV and toys are the first thing they'll stop paying; most people would rather keep the house than the boat if forced to choose. Thirdly, with all the boat biz scams and illicit dealership practices of late, it's no wonder that lending institutions are hesitant to loan on a boat. Lastly, it just doesn't make sense for lender to buy a boat for the client (borrower) when that boat will be worth about 1/2 of what you just paid for it in 12 months - talk about unsecured debt.

Aaaaaaah....intelligent thinking....nice for a change.


The loans are there. You have to prove Stability, Ability and Willingness to repay any loan. A boat loan requires a couple more things to be proven. What I have noticed from recent experience is that no matter how high your score or how much income you have, if you are debt loaded out the yang, you are in for a challenge.

The Performance Boat Industry is going NOWHERE. (you heard it here first.)

 

[phragle]

like I posted in another thread...


$$ WE ARE OUR OWN BANK WITH MILLIONS TO LEND $$
No Credit - APPROVED! * Bad Credit - APPROVED! * Bankruptcy - APPROVED!
REGARDLESS OF YOUR CREDIT HISTORY - APPROVED! * Contact us at: 800 950 BOAT

 

[planetwarmer]

like I posted in another thread...


$$ WE ARE OUR OWN BANK WITH MILLIONS TO LEND $$
No Credit - APPROVED! * Bad Credit - APPROVED! * Bankruptcy - APPROVED!
REGARDLESS OF YOUR CREDIT HISTORY - APPROVED! * Contact us at: 800 950 BOAT

If your avatar is your picture, people may be afraid to borrow from you. You look like you will break their legs if they default!

 

[phragle]

you do not recognize my avatar? even after johnny Dep's portrayal and the cover of the rolling stone????

 

[BlackJack58]

you do not recognize my avatar? even after johnny Dep's portrayal and the cover of the rolling stone????

Maybee sum peepul are just knot that well-red. Yoo just nevur kan tel. :biggrinjester: But it duzn't justifie anee "Fear & Loathing..."

 

[phragle]

I like your style... you should party with my lawyer sometime.

 

[planetwarmer]

you do not recognize my avatar? even after johnny Dep's portrayal and the cover of the rolling stone????

Sorry, it was a bad joke. It did seem funny at the time!:biggrinjester:

 

[fund razor]

If your avatar is your picture, people may be afraid to borrow from you. You look like you will break their legs if they default!

His avatar ain't nothing.
Rob can achieve scary all on his own.

Anyway... it bums me out.... because I was one of those business owners who always paid the bills and had cash flow. But I can't disagree with Nick.
Although I do see credit loosening up at some point. Cash has always been king. But making credit available to an economy just plain allows more people to participate in that economy. I never expected most people to have sympathy for my hobby. When the government owns the banks they can control society by what they allow credit to be used for (at least among the tier below the uber-wealthy.)
In the long run... this will help the used market and classic offshores, because many will be able to trade in the used world. You can buy an old offshore for cheap and then pay the cost of maintenance over time rather than paying a note. A guy with even 30k in cash can go buy a great hull and then bring it back over a couple of years. You can finance blocks, rotating assemblies, heads, and cams. You can buy a carb. Bilge pump. Adds up of course. But with cash flow and delayed projects... end result is good, fast boating.
Sucks for a guy like Bill (WMF) who currently prefers a newer more turnkey boat right now, and is willing to make a big payment to get in a fairly new boat. In the interest of fuill disclosure, I bought Bill's boat in October and I feel a little guilty that he is having trouble replacing it right now.
Bill:
Maybe the restore plan isn't so bad. You probably wanted something a little bigger than the 28, with your family... but if you find a nice 31 or 35 cig, needs power... I know that you can get good help here and be able to build some big power reasonably.

 

[fund razor]

Hunter S. Freaking Thompson. (RIP)

 

[Audiofn]

I would assume we are going to see a drastic drop in price on new boats soon. They have to do something to keep inventory moving or they will have to shut down. Prices just have to drop. Not long ago (the 80's) a 30 foot Formula was in the 40K range I think it was. Now they are almost 200K or more! I am not so sure that the costs have gone up that much but maybe they have?

 

[Magic Medicine]

I would assume we are going to see a drastic drop in price on new boats soon. They have to do something to keep inventory moving or they will have to shut down. Prices just have to drop. Not long ago (the 80's) a 30 foot Formula was in the 40K range I think it was. Now they are almost 200K or more! I am not so sure that the costs have gone up that much but maybe they have?

I really don't see that happening, there are still people able to buy the big ticket items. They may not be plenty as they were but once things start to loosen up I am sure some guys are going to have some money burning a hole in their pockets, its not like it doing good in the market or real estate right now.