mirageman

So I got this flyer from my mortgage holder stating I have $60k in equity in my home that I could use, at 5.25% and would only be $263 bucks a month addition to the mortgage payment.
Anyone here use the equity in there house to buy a boat before? What were the pro's and con's?

rchevelle71

iTrader: (1)

CON: Most homequity loans are variable rates.

PRO: you can insure it for as little, or as much as you wish, not what the loan provider tells you since the loan is secured by your homes equity, not the boat.

I am thinking of doing the same.

SinkorSwim

be very careful,,,

Did not like that at all, did it on the first boat...

Downtown42

If your world crumbles, you are gambling some with your equity in home. My opinion, get a fixed rate boat loan secured by the boat and if things go to hell, at least you can retain some of which you have worked for.

I would bet rates are very good still for fixed loan.

Ck with Von Bongo, Mitch Stellin and others on board for their rates.

Cord

iTrader: (2)

I agree with downtown 42 totally. I'd rather give up the boat than my home.

mirageman

The Family has spoken.....boat loan it is!

Von Bongo

Depending on the boat there may be no advantage. The 2 possible advantages would be maybe a lower rate and possible tax deductions. Most of the offshore boats already have the v-birth, potty and "galley" to qualify as a second home.

Boat rates last I checked for up to 20 years fixed were 5.25-5.75% fixed. They might be up a touch I just haven't looked at them for a couple weeks.

MitchStellin

I went thru Coastal Marine and have a 15yr at 5.5% fixed, no balloon either. The Bank I work for was a full % higher. The HELOC is a variable rate and and when the Fed starts raising rates you will move with them. As long as you have a sink you can write the interest off anyway. I can give you the number for Coastal, it is 616-494-2628, ask for Chris. No fees either.

CigDaze

Just so there's no confusion, here's the text on Interest deductions on boats, straight from IRS publication 936:

For you to take a home mortgage interest deduction, your debt must be secured by a qualified home. This means your main home or your second home. A home includes a house, condominium, cooperative, mobile home, house trailer, boat, or similar property that has sleeping, cooking, and toilet facilities.

http://www.irs.gov/publications/p936/ar02.html#d0e495

Sydwayz

iTrader: (1)

If you search hard enough, you can get 5.25% on a boat loan.