Marine Financing - a bit long
TK
a bit of work finding what seems right for me, if all goes well I will
soon be on the water. We did a sea trial this morning and I'm having an
engine survey done tomorrow morning. The final pre-purchase survey is
scheduled for Sept. 13 and based on today's sea trial, I don't except
any major issues to crop up. I've got my insurance lined up and a spot
in rack storage at the marina near my house. We're already planning
our first trip.
About the only loose end I'm tying up right now is the financing and at
this point, this shouldn't be a loose end. I got so mad today when I
got off the phone with the finance company I've been dealing with that I
just had to post a little note - maybe to vent a little bit, definitely
so that someone else can avoid the same hassle. Since I'm a private
citizen and I'm recounting my own personal experiences, I don't see any
particular problem with mentioning the name of the company - Chesapeake
Financial Services in Annapolis, MD.
To start my search for financing, I used the web to search for the best
rate and terms. I refinanced my mortgage this way and was pretty happy
with the result so it seemed like the right way to finance a boat. Some
companies post their rates on their web sites, others want some info
before they provide you a quote. Most appear to be pretty straight up
and for the most part, provided me with timely information when it was
requested. Unfortunately, what appeared to be the best deal out there
as far as rates and terms didn't turn out that way. I made the mistake
of dealing with Chesapeake which IMO is utilizing the old bait and
switch in the worst way. This company advertises rates for different
sized loans and various terms on their web site. They lead you to
believe that you can actually get these advertised rates but it turns
out, it doesn't work this way.
After a quick call to confirm their rates, I filled out their on-line
application and applied for financing. A few days later, I received a
voice mail that I was approved and the owner of the boat I was buying
told me that they had contacted him to get the info on who held the
current loan. At this point - I thought - wow, that was easy. When I
called to confirm everything, I learned that I was indeed approved and
everything was set except the interest rate was almost 10% - over 2%
higher than the rate I thought I was getting. When I asked about this
difference, I was told that in order to get the lower rate they needed
to go with a different lending institution which required some
additional documentation in the way of tax returns and a financial
statement. No problem, I thought, so I quickly gathered this info up
and sent it in via FEDEX.
Today I called to check again and learned that I'm still approved but
the rate is still 1% point higher than advertised. When I asked why, I
was told - well you can get the lower (advertised) rate, but you need to
put down 30%. This, despite the fact that their web site advertises
this lower rate with 15% down. When I asked why 30%, I was told that it
probably has to do with the book value of the boat. This seems like
total BS since the boat is a 3 year old Searay 290DA, very lightly used
(115 hrs) and priced squarely in the middle of all the Searay 290s in
Florida. It also falls right in line with the NADA published prices
although I don't put much stock in those. In fact, by working backward
on the amount they are willing to finance ($53,000) at the lower
advertised rate for this boat, I calculated they value the boat at just
over $62,000 ( $62,352.94 for all you fellow finance folks) which would
make it the cheapest 1996 Searay 290DA in the entire country and quite a
steal considering how lightly used it is.
Seems like the old adage about "if it sound too good to be true it
probably is" is right on the money here. Fortunately, I've
pre-qualified with a few other lenders and am back to shopping around
for the best rate again (that I can actually get). If anyone has had a
good experience with a marine financing company they would like to share
- I'm all ears. As for Chesapeake Financial Services - I hope they will
clean up their act and stop the bait and switch routine.
TK
MuryMann
>good experience with a marine financing company they would like to share
>- I'm all ears
Essex Credit.... I've had four loans with them. My last purchase... I called at
9:00am Monday, hand delivered the deal and survey at noon Tuesday and had my
check at 12:00 noon that Wednesday.
Cresstar wouldn't even return my phone calls.
Sterling Financial also was good to me a few years back, but their rates and
high for used boats, and they wouldn't do an 80% deal for me on a 5 year old
SeaRay with a 45% loan-to-book equity value. ( maybe my credit wasn't strong
enough then.. who knows. )
My best experience has been my local hometown " Co-operative" Bank. Rates are
reasonable and getting the loan is easy. The down side.. loan period is just 5
years.
Good Luck!
BK
Larry Weiss
And don't forget to check out Boat/US.
Larry Weiss
"...Ever After!"
TK
helpful not to mention reasonable terms and rates. I'm also pleased that we're not
playing games with the rates. I also like the fact that they have a local office
here in Jax where we will do the actual paperwork which will help since this
particular boat is for sale by owner.
This entire boat buying experience has been quite interesting and at times a bit
frustrating - maybe a little bit like actually owning a boat - which if all goes
well will be the case in less than two weeks once we get the survey wrapped up.
Thanks for the help-
TK
Jared Sherman
Is it diesel? If so, what are you paying & what are they actually going
to be surveying for you on the engine? I've been wondering about how to
have a diesel "properly" inspected during a purchase myself.
TK
Jared -
The engines are gas - mercruiser 4.3LXs. The term survey is probably
used loosely in this context but what I did is ask around the marina
to find the best mechanic. I then paid his hourly rate ($55 an hour
for two hours) to come out and do several things to the engine
including a compression test and a hard look at all the major
components including the drive units. He looked at the oil, checked
the hoses and belts and provided me with some education on how to
properly maintain these engines. I feel like it was money well spent.
This particluar boat is 3 years old and very lightly used (about 100
hours). Despite the sellers assurances that the engines are in good
shape, I still feel better hearing that from an expert mechanic. This
seems to be the only way to go since it seems most surveyors won't do
much with engines.
The actual survey is scheduled for Monday and if all goes well with
that, we'll complete the transaction later in the week once the
written report is done.
TK