Will You Go Broke On A Boat? - 1999 Viking 60 SportYatch

[fgarriso]

I hate to say it, but your just one break down from going broke. One serious break down from going bankrupt and still having a bank note.

DON'T DO IT!

 

[El Dorado]

Thank you for the patience, having access to the Freedo boat club sounds like the most reasonable first step. That way you can build up 100hrs of experience with a licensed captain for preparation in the insurance department.

 

[READY]

That is an excellent idea. A great way to dip your toe in with no long term commit or huge up front investment.

 

[El Dorado]

That is an excellent idea. A great way to dip your toe in with no long term commit or huge up front investment.

Appreciate it, I would've never known the service existed, thank you all.

 

[Snapdragon III]

I would say don't do it. In every case, I would say don't buy a boat unless you can afford to pay cash for it. Also, you need to really drill down on what is available, and how much it will cost for insurance that covers Hurricanes on PR.

 

[El Dorado]

I would say don't do it. In every case, I would say don't buy a boat unless you can afford to pay cash for it. Also, you need to really drill down on what is available, and how much it will cost for insurance that covers Hurricanes on PR.

Yes understood on the burden of just getting coverage and I need to a few years to work on that. But how do most yatch owners finance $2million dollar plus vessels? During low interest rates, they could just borrow against their assets, which made sense.

Doesn't it make theoretically more sense to get a loan, if you can write off the interest expense?

It will be achievable to have a monthly income to cover something like this, but to pay in one lump that could mean savings of 20 years? Is that really necessary if it was treated as the primary residency? That is another struggle to deal with.

 

[mvweebles]

There's an old saying that banks like to lend money to people who don't need it. A boat is lousy collateral and will result in an expensive loan with lousy terms if you can even find a lender.

While I know a lot of owners who would be hit hard if their boat was lost, I don't know anyone who's boat is their top asset. They have access to capital secured by other assets if desired.

Peter

 

[Snapdragon III]

Yes understood on the burden of just getting coverage and I need to a few years to work on that. But how do most yatch owners finance $2million dollar plus vessels? During low interest rates, they could just borrow against their assets, which made sense.

Doesn't it make theoretically more sense to get a loan, if you can write off the interest expense?

It will be achievable to have a monthly income to cover something like this, but to pay in one lump that could mean savings of 20 years? Is that really necessary if it was treated as the primary residency? That is another struggle to deal with.

In my personal experience, everyone that I know that bought a 2 million dollar boat could easily afford to pay cash for it. They might not have due to some tax reason, or something, but it wasn't because they didn't have the cash. I had one friend with a boat that was valued right around 2 million, used (it was 3.5 new), and his insurance was $50K a year!

 

[Action]

But how do most yacht owners finance $2million dollar plus vessels?

As stated above. Wire transfer the CASH.

Doesn't it make theoretically more sense to get a loan, if you can write off the interest expense?

A purchase of <$300,000 primary residence, sure. And that is how you are thinking about this purchase.
This isn't house with some added monthly expenses. This is more like a serious monthly or on going expense that happens to be relatively low cost to get into. A 25 year old yacht that has depreciated significantly in value. But the maintenance does not stop. It gets more expensive.

It will be achievable to have a monthly income to cover something like this, but to pay in one lump that could mean savings of 20 years? Is that really necessary if it was treated as the primary residency? That is another struggle to deal with.

This is why it is necessary to have pre-purchase inspections. To know what is obvious to a trained eye that will be immediate problems to address.