Do many owners borrow to buy a boat?

[Frogmogman]

It seems like there is some kind of virtue-signalling going on in this thread; I don't borrow money, aren't I brilliant ?

If you can afford the payments and it suits your situation, there's nothing wrong with borrowing cash against something like a boat.

Certainly in France, financing a new boat on a lease scheme can make a lot of sense. You get to halve the VAT bill, and on current interest rates the saving on say a 5 year lease will pretty much cover the cost of the credit.

Historically in France leasing has been attractive fiscally, as in tax terms boat is seen as an outgoing expense rather than a capital asset which would have to be included in the calculation of your net worth for the dreaded ISF wealth tax.

 

[Uricanejack]

Interesting. Boats are often leased in France. Leading probably to more French sailors. Because it probable makes it more affordable for more people.

Cars are often leased. Although I have never leased one myself. It obviously works for some people.
The advantage. For a clearly defined monthly cost for a clearly defined period of time. You have the use of a nice reliable car.
The end of which you go lease another.

I wonder why a “lease” option is not readily available for most new boats?

 

[Skylark]

I love the way so many people say they'll never borrow money to buy stuff, but they're all happy to have a mortgage!

........happy to have a mortgage, so that's hypocritical.

It seems like there is some kind of virtue-signalling going on in this thread; I don't borrow money, aren't I brilliant ?

I just love reading contributions from posters suffering from “chip on their shoulder” syndrome

May 2019 bring happiness to one and all.

 

[pvb]

I just love reading contributions from posters suffering from “chip on their shoulder” syndrome

May 2019 bring happiness to one and all.

Ah, so someone whose opinion differs from you has a "chip on their shoulder"? What a strange way to view the world. HNY.

 

[JumbleDuck]

If there were no "mugs" prepared to buy new cars then you would never get the chance to own a 2cheap2 fully depreciated car.

Of course, but you are conflating two different issues. Even for people who want a new car, personal hire plans are a lousy deal because they cost more than just buying and selling. Evidence: car manufacturers make FAR more from these plans that they do from selling cars.

Cars are not a long term asset but a short term consumer item.

That's definitely a matter of opinion, and confounded by ...

If you are really seeking the overall lowest cost of motoring then do what I do. Buy a new or nearly new car and run it until falls apart or has little monetary value.

The monthly cost in terms of capital erosion is much the same as the dealer plan over the first 3 or 4 years (how could it be any different given you are consuming the same value)

Because in one case the manufacturer is making a whacking great additional profit. What an odd question.

Of course neither of these two strategies suit everybody, nor do the others that you can construct but you can't call them a "rotten deal" just because they don't suit you.

Conflation again. Even if I wanted to throw money away on a new car, personal hire would be a rotten deal because it's a very expensive way of doing it.

 

[Luffe44]

Perhaps it is a matter of priorities? If you prioritze boating, you don't wait but take a loan or up your mortage. Alternatively you do boating with what is left after the important stuff is taken care of.

 

[Irish Rover]

It seems like there is some kind of virtue-signalling going on in this thread; I don't borrow money, aren't I brilliant ?

As I said in my OP I wouldn't dream of borrowing money to buy a boat. No virtue involved. Maybe it's a lack of courage or self confidence or maybe it's just a throwback to my upbringing in a poor family. But let me ask this. Would you borrow money to buy a race horse or a share in a race horse? I'm involved in syndicates in Ireland which, overall, cost me much more annually than my boating. There's no chance my boat will quadruple in value over night but one of the horses could turn out to be a champion hurdle or gold cup contender and be worth considerably more than it cost us. Given this potential for profit would any of you borrow to finance an interest in horse racing?

 

[Skylark]

Ah, so someone whose opinion differs from you has a "chip on their shoulder"? What a strange way to view the world. HNY.

On the contrary. Many have differing views as evidenced by the content of the thread. Only those with chips on their shoulders chose to make unnecessary disparaging comments about those who have different values to their own.

 

[Daydream believer]

Horses for Courses really:encouragement:

 

[Luffe44]

As I said in my OP I wouldn't dream of borrowing money to buy a boat. No virtue involved. Maybe it's a lack of courage or self confidence or maybe it's just a throwback to my upbringing in a poor family. But let me ask this. Would you borrow money to buy a race horse or a share in a race horse? I'm involved in syndicates in Ireland which, overall, cost me much more annually than my boating. There's no chance my boat will quadruple in value over night but one of the horses could turn out to be a champion hurdle or gold cup contender and be worth considerably more than it cost us. Given this potential for profit would any of you borrow to finance an interest in horse racing?

We each have our passion(s), horses for some, sailing for others. Is there a passion for motorboating?

 

[CAPTAIN FANTASTIC]

I have done and I will do whatever makes financial sense at the time. If you can borrow money cheaply, why not?. If you have spare cash in the bank or under the mattress, why not use it?. if you want to fiddle the taxman and manage get tax free, by different means, why not?

 

[Garold]

Serial new boat purchases, particularly from a single brand, seems to be more common in the mobo community - but I suspect far less common in the sailing boat community. Many tend to buy second hand and keep for long periods - and or buy new perhaps once or twice in a lifetime.

I’m not sure if your opinion is a true reflection of reality but just for clarity our finance was for two catamarans, one small mobo, and a monohull.

And yes, after some thought, my first post was incorrect - I believe that we’ve used finance on four boats.

I just can’t imagine that Beneteau would have been able to expand their business without offering easy finance packages (and govt subsidies etc etc. )

But just for the record, the fact that the French (and other EU buyers) can get partial VAT relief on their boat purchases by leasing, and we can’t, has always deeply irritated me. I sure that we could have developed our own similar scheme within the EU rule book.

Garold

 

[Deleted member 36384]

I am on my 7th house and first boat, all financed by mortgage. The last two houses and boat were paid off early by simple overpaying monthly and dumping bonuses into the mortgage. I also bought my first new car on a low cost company loan, fitted a new kitten to the 4th house with a bank loan, rather than extension to the mortgage, which was also settled early. Before boat ownership I chartered. As far as I am concerned mortgage finance was fantastic, I now find myself with assets, debt free and cash rich in my early 50's. Either LadyOldBoots and I will blow the lot, or the kids will pick up the assets when we pop our clogs. My son is very interested in the boat, so he gets to sail it without the hassle of chartering. A pleasant surprise was low cost endowments. I long converted to repayment mortgage when low cost endowments were known to be shit. I sold them all and got a nice return which made a big dent in one of the mortgages. After that it became addictive shoving money into the mortgage account and seeing it reduce. I would not like to be at this stage of my life, with little to show for it and debt. Mortgages have been good for me and my family and the time to have them and manage them is when you are young and developing your earning capability. However, it is all about the arithmetic, they are either affordable or not.

 

[Tranona]

Of course, but you are conflating two different issues. Even for people who want a new car, personal hire plans are a lousy deal because they cost more than just buying and selling. Evidence: car manufacturers make FAR more from these plans that they do from selling cars.



That's definitely a matter of opinion, and confounded by ...





Because in one case the manufacturer is making a whacking great additional profit. What an odd question.



Conflation again. Even if I wanted to throw money away on a new car, personal hire would be a rotten deal because it's a very expensive way of doing it.

I am not sure you have really done the sums. Do them and you will find out why PCP is attractive for those who do not have the capital to buy a car.

And no, I am not going to do them for you but part of the secret is in the interest rate compared with that available from other sources.

Perhaps your problem is a basic belief that people are being screwed without actually testing the evidence.

 

[Tranona]

As I said in my OP I wouldn't dream of borrowing money to buy a boat. No virtue involved. Maybe it's a lack of courage or self confidence or maybe it's just a throwback to my upbringing in a poor family. But let me ask this. Would you borrow money to buy a race horse or a share in a race horse? I'm involved in syndicates in Ireland which, overall, cost me much more annually than my boating. There's no chance my boat will quadruple in value over night but one of the horses could turn out to be a champion hurdle or gold cup contender and be worth considerably more than it cost us. Given this potential for profit would any of you borrow to finance an interest in horse racing?

The two are simply not comparable. Your horse racing activities, including the hope of owning a winner are just gambling (with perhaps a bit of skill thrown in).

Seems totally at odds with your second sentence.

 

[Irish Rover]

The two are simply not comparable. Your horse racing activities, including the hope of owning a winner are just gambling (with perhaps a bit of skill thrown in). Seems totally at odds with your second sentence.

You clearly know nothing about horse ownership. I'm a boat owner because I enjoy boating and get pleasure from it. It brings me into contact with like minded people including on this forum and I've made some great friends through boating. I'm a horse owner because I enjoy horse racing and horse ownership and get pleasure from it. It brings me into contact with like minded people and I've made some great friends through horse ownership and racing. Both are relatively expensive hobbies and I participate with no expectation of a financial return. I wouldn't borrow to finance any hobby. I was posing a question to posters who are prepared to borrow to finance their boating - would you borrow to finance horse ownership which, at least, has the potential to offer a return.

 

[Irish Rover]

We each have our passion(s), horses for some, sailing for others. Is there a passion for motorboating?

Of course not. Motorboaters just like the noise and the smell of diesel fumes. Same with my interest in horse racing. I just like the smell of horse shit. Perish the thought that anyone could match your passion for sailing.

 

[pvb]

On the contrary. Many have differing views as evidenced by the content of the thread. Only those with chips on their shoulders chose to make unnecessary disparaging comments about those who have different values to their own.

So you're saying you have a chip on your shoulder?

 

[Skylark]

So you're saying you have a chip on your shoulder?

Nope, I’m well balanced. I have a chip on both shoulders.

You seem to be forgetting that you were the one calling people a hypocrite for their financial choices in life. I wouldn’t dream of making such a personal, unprovoked attack on someone’s lifestyle.

None taken

 

[JumbleDuck]

I am not sure you have really done the sums. Do them and you will find out why PCP is attractive for those who do not have the capital to buy a car.

A new car. And that is the problem. As I originally wrote, personal hire is an expensive way to hide the pain of new car ownership. It may be attractive, but it also makes huge additional profits for car manufacturers - from whom, precisely, do you think these profits come?

Payday loans are attractive for those who do not have the capital to buy a new phone. They are also a very, very bad deal.

My scruffy old Berlingo cost me about the same as two months personal hire of a new small VW. That's without the deposit and without having to give it back to the manufacturer to sell on the second hand market when I have paid the depreciation.