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Sometimes Financing is Better than Cash

December 28, 2016

Savvy buyers are making the decision to finance even when they have the cash. Financial flexibility is key to getting the most out of your buying power. Pre-qualify today!

As year-end approaches, we all start looking at where we are in life. From New Year’s resolutions to squeezing in those last few thousand miles to get us to the next frequent flier level to what to do with disposable income. Why not take advantage of some of the best interest rates of the year …

Pay cash or finance?

It's a debate being played out all over the country. The current low interest rate environment is helping to drive sales, especially of yachts. Whether to finance or pay cash often is a big consideration for any potential buyer. Where arguments can be made for both sides, we are finding that, even if they have the cash, some savvy buyers will choose to finance for some very practical reasons.

Interest rates on boat loans are running at around 5 percent. Lenders who have been in the business for more than 30 years say they have never seen rates on boat loans so low. With borrowing rates low and attractive, financing instead of paying cash allows the buyer freedom to invest cash in growing financial markets.

Today, buyers can weigh the options. Sometimes even a partial finance, say 30%, can free up a good amount of cash for other options such as high yield managed funds, the market as it continues to climb, even real estate. These decisions should be made with the buyer’s financial advisor of course, as there are many things to consider that are individual to each portfolio.

There are other things to consider in the cash versus financing debate. Marine loans are more like home loans, especially on boats with a head, galley and sleeping quarters. For example, you can finance a boat for up to 20 years. Some say, because a boat with a head, galley and sleeping quarters qualifies as a second or primary home, you can deduct the interest from your federal income tax.

Historically, boat loan rates have been "priced a few points above those of home mortgages". This spread has disappeared for a variety of factors. Default and delinquency rates for boat loans are also very low, well below those on car loans and, certainly, credit cards. Competition among lenders for these high-quality loans has helped erode the spread between boat loans and other types of loans.

When you're shopping for loans, lenders advise you to ask about points, fees and closing costs, just as you would when shopping for a home mortgage. Watch out for early-payoff penalties. Make sure you're dealing with a lender that offers the level of customer service you think you'll need.

In synopsis, by financing the purchase of your new yacht, instead of liquidating assets or paying cash, you increase your financial flexibility. This allows you to take advantage of attractive new investment opportunities as they present themselves. You may even qualify for some tax advantages, similar to those you currently take on your home like deductible mortgage interest. These items together could potentially offset the cost of your boat in such a way that it may cost you less by not paying cash!

Get your ducks in a row, buy by year end or set yourself up for success in the New Year, call DetailsDetails today.

First Time Yacht Buyers

by Michael W. DickensMay 16, 2016

If you happen to be a first-time pre-owned cruiser customer the options of used yachts available for sale is usually too much to handle. How does one understand each of the versions and varieties out there?

The brand new pre-owned yacht client really should refrain from choosing on feelings and relax and take a critical look at what they anticipate doing while using the watercraft. Carrying out the inappropriate selection will certainly be a big letdown in the longer term and quite likely financially impact you financially. To start off, are you presently a sailor or a motor cruiser?

Quite a few like the appeal of a sailboat with the picture of exotic island destinations in the snapshot; yet quite a few don't want the need for the sails, rigging and so on. However a sailboat is quite cheap to operate if your strategies consist of planning a trip to far-away destinations. Also, power boating will not be pricey if you pick the proper watercraft.

Powerboats commonly come properly designed with all of the little luxuries you could possibly every need; frequently much more than all but the largest sized of sailboats. And you don't need to learn all of the sailing skills as well. Once you have considered your cruising personal preference you are usually able to determine what you intend on doing with it.

Will you be intending to sail, cruise or fish from it? Needless to say, you can actually fish from just about anything if you would like, but used yachts suitable for offshore fishing are generally different than those built for cruising. How many times will you make use of your brand new used boat? I often say that you can find "boaters" and "boat owners". Boaters use their boats; yacht owners just like to tell you they own a vessel as their yachts rarely leave the boat dock. Some boaters may just be full-time live aboards making use of their boats as their family home every single day. Other people might just use their boats on nice vacations when time allows for.

Next is the expense of yacht ownership. You will need to take this under consideration. The purchase price is pretty much like a down payment. Cruising has its own fees that you must be mindful of. If you're mechanically prepared, you will find that the expenses usually are not very high.

The majority of boat operators carry out the vast majority of work themselves. I have a blog posting at my Cruising Center website in regards to the details of boating expenses that breaks it down into every charge. Feel free to take a look.

So at this point we now have figured out what version of boater we are, so we understand what variety of vessel generally interests us, we realize how much we expect to use it and about what to be expecting in the upkeep of her. Thus far so good!

Now comes the tough part; how to decide on just the right one? I have produced a buyers check-list that I use with my clients to permit them indicate the essential popular features of a yacht. This permits them to select features that they can live without and the ones that are features which are cannot-live-without. That check-list then will become the structure for the best yacht research. When I am working together with buyers, I then try to find used boats that best meet the customer's wishes knowing that vessel acquisitions sometimes incorporate some compromise. Almost never do I find a vessel with all the desired characteristics. In the searching phase, I always point out that you'll realize it when the proper boat unfolds; it will certainly "talk" to you personally. Any potential vessel will have the lines, the feel and the characteristics that suits you. Never settle for anything less than that pleases you.

But how about the expense of that vessel? Exactly how do you're certain you are getting a fair package? Borrowing from another posting at the Cruising Center in regards to the True Value of Boats, good boats always receive higher selling prices, always! A more recent boat in poor condition will deliver a lot less than an old boat in great condition always! Under no circumstances buy a yacht determined by the price tag alone or you will be advertising it for sale it within 6 months.

And must you accomplish a marine survey, yes it's normally suggested. Choose an experienced surveyor that has experience with your preferred boat. Ask him for individual references too.

Fun Things to Do on a Boat

by Sarah menonSeptember 6, 2016

Boating in itself is a great recreational activity. Hitting the water on a sunny day is a great way to enjoy the day. However, after a couple of days on your boat or yacht, this might seem a little monotonous. But, there are a host of other activities that you can do aboard your yacht or boat, that will keep you and your family from getting bored. This boating article lists out a couple of fun activities that you can adopt when going yachting or boating.


Boating is fun. But don'tleave your other hobbies behind. When yachting, you can carry your hobby withyou! If you are into reading, carry a couple of books. You can catch up on your reading with no disturbances. Writing is also a good option. Your boat or yacht can function just like the inspirational writer's cabins in the woods. Or, just jot down your reflections in the form of journal entries!


Go boating and dock at interesting places. Explore the locality, immerse yourself in local culture.

Water Sports:

Indulge in water sports. Go water skiing, tubing or wakeboarding. Water sports get your adrenaline pumping, and if you're tired you can always climb back into your boat or yacht and relax.


Enjoy a quiet afternoon fishing. You can even take back your catch home for dinner!


Your yacht or boat is the perfect place to entertain your family or friends. Invite them over to spend a day on water with you. In the company of family and friends, boating takes a whole new avatar. You could have lunch on the boat and then enjoy some water sports. It's a great way to bond with new colleagues at work too!

Plan a Date:

Wondering where to go on your next date? Why not go boating? There are few things that could beat spending time on a boat under the open sky, as the light breeze blows on. You could watch the sunset and have a romantic dinner illuminated by the stars and the moon. There are endless activities that one can do on a boat.

The key is to choose something you enjoy. With so much to do, boating can never be boring or monotonous.