baywatch

Unless for some reason you don't think you will get financing, I would never do a pre-approval before you have a contract on the boat which is contingent on financing. All of those hits push your credit score down.

My wife and I's Fico's are each in the 790's and we have yet to ever get pre-approval on anything. We submit a contract contingent on financing and then start calling for rates, and we don't allow our credit to be pulled until we find the best rate/term and then it is only pulled once.

The one thing that I have learned over the years is that banks like to lend money to people that have a little money. If you are buying a 50k boat and you have 60k in a money market account it is a slam dunk. On our boat they didn't even want tax returns, just stated income.

DaveP

Excessive credit inquires will hurt your score. 4-6 a year is not excessive. 10-15-20 will hurt your score pretty good.

Always make sure you know how many banks a finance company will send you to? Some SHOTGUN your application and send you to 6 banks at one time. That is not something you want. Decide on which bank has the best shot at offering you the loan amount, term and conditions that you are looking for.

Panther

In my experience I found that dependant on what your credit history is it was important to work with the right banks. Banks also see boat loans as a personal loan, more than an assett backed loan because a boat depreciates in value.

Some banks look at a combiniation of Credit score and "Credit History", which where my problem lied... My credit score was excellent. I always paid cash for everything, and had "ZERO" debt so I didn't have credit history.

I found it to be extremely frustrating because I had the income to pay for the loan 3 times over, $40K down on a $100K boat etc. But due to my history, or lack there of, I couldn't get approved. Everyone would look at my paperwork and tell me that it wouldn't be a problem. My credit is excellent, my W-2 is excellent etc. etc.

Most of the agents would go to places like Key Bank, and I would get turned down. I was constantly getting turned down until I met someone who analyzed my situation in-depth and given my circumstances knew exactly which bank to go with and whala.... APPROVED!

The good news is, in my case, the next loan will be much easier to get!

Von Bongo

And the reason is that on a luxury item, or any major thing lke a home, we don't want you 1 missed paycheck from being in trouble. It's called reserves and shows the ability to weather an illness, lost job or an unexpected expense.

Strip Poker 388

iTrader: (6)

DaveP thanks for the post ,Thats some good info.

The Comp Credit is what go me My locall bank made the loan anyway.But will prob have the same prob when I up grade.

Some people, the will to pay out weighs the ability to pay and wil pay it no matter what. IMO ya have to look at the person.

Rob

DaveP

Smaller local hometown banks are better when it comes to a situation like yours. The local bank knows you, might have your business checking with them or mortgage, etc.... It is usually easier for them to bend the rules than the larger national lenders. On the flip side, most of the time the large national lenders have better rates (usually but not always).

Strip Poker 388

iTrader: (6)

How do you get a national lender to take a chance on the Comp Credit prob,when everything else is steller?

DaveP

Thats kind of like asking what are the numbers to the lottery tomorrow night?

It all depends on the top credit person of the bank as well as the size of the loan.

Comp Credit is $30k and you are looking for $100k? This is much easier than comp credit being $30k and looking for $300k.

Most national banks have strict guidlines. A few let their Chief lending officers made decisions outside the box.

I wish I could be more exact but it is a tough call.

The other factor - if you are using a finance company do they have an excellent long relationship with the bank and have had zero problems with their portfolio or have they had some repos and losses recently??

That can also be a factor.