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Used Boat Loan With Down Payment Collateral – Bad Credit in San Luis Obispo

This borrower is living in central California in San Luis Obispo and wants to borrow $112,000 in the next month so he can upgrade his boat to a Sea Ray 340 that he has his eye on. He has collateral in the form of the used boat he is buying and he has some home equity if required. He has a down payment of $50,000 as well, so you would think this loan would not be a problem at all. However, he is overall DTI is a concern due to support payments, his mortgage payment, current personal loan payments, and cost of living.

His current wife doesn’t work either which makes it harder as his income is the only income they have for the household. He doesn’t make allot of monthly income because he is a school teacher. He is a life-long teacher and has no other extra income coming in from any other source. You can see the results of his application with the lender at hand below, and he was really on the hairy edge when it comes to approval. He was ultimately declined for approval because of the DTI issue, but we present with his permission the full the pre-application details of the loan request.

It’s also difficult to get approved for a loan on used boats these days. We are not completely out of the woods as far the economy goes, and lenders are not willing to take any chances at all, unless the applicant is in a very strong financial situation. This applicant also has bad credit, which really finished him off with the bank(s). He has been shopping for this used boat loan for over 2 months now with no joy. With all of the borrowers and applicants out there just trying to stay in their homes, it seems like this application was for the sake of the borrower’s “wants” and not his “needs”. We can always get by in life without a fancy boat in the driveway or on the dock. You have to have allot of extra money to afford the storage, and up-keep on a boat – it’s a not a smart investment unless you have some big cash to throw away or flush down the toilet. So many boat owners have high paying dual incomes coming into the household, and very often owners of boats in this price range are self-employed where the cost is not an issue at all. These are households that have around $12,000 to $15,000 net income coming in every month without interruption.

Used Boat Loan for $112,000 In San Luis Obispo, California (the application)

Private boat loan description :: Used Boat Loan (Sea Ray 340 Sundancer)

Why do you want a boat loan? :: I would like to trade in the boat I have and buy a brand new Sundancer, combining my $50K down payment, my trade-in money. Obviously I want a the loan to buy a boat? Confused a little by that weird question.

How Much Do You Want To Borrow for your boat loan? :: The used 340 Sundancer (by Sea Ray) is priced reasonably to sell at just under $180,000, so this is how the math goes on this transaction. My trade in value has been appraised at $18,000 and change. My down payment is $50,000. So adding this liquid cash up it comes to  $68,000. Subtract these monies from the purchase price of the new (well new to me) boat which is $180,000 means a I need a total loan from the bank or private lender for $112,000 dollars. I would like to spread this loan over a 25 year length of time and term. I have calculated the different APR amounts and installments per month as you suggested on your post on used RV loans.

Used Boat Loan for $112,000 In San Luis Obispo, California (employment history)

Length of Employment :: 6 years at Hawthorne, and 25 years teaching. It’s my only profession. Only income.

Time at Address :: 6 years when moved to central California.

Age :: 54

Anything else you can tell us to speed up approval? :: I only have bad credit due to helping one of my children fight a very bad addiction to drugs. I had to spend over $180,000 in legal fees, retreats, and rehab clinics throughout California, Nevada, and Arizona. I will be able to make the payments on this boat without any kind of foreseeable problems in my monthly finances – my job is extremely secure, and therefore so are my payments to the lender. Also, this boat may be used but this price is very good when you consider how little hours are

Sex :: Male

Marital Status :: Married

Ever Claimed Bankruptcy? :: No

What City/Town, County, and State is your primary address in? :: San Luis Obispo (AKA; SLO), California (County is same name)

Zip: 93407

Have you checked your credit report lately? :: Yes

Would you consider your credit rating to be? :: Bad

Which bank do you use and which branch? :: Mission Community Bank, 581 Higuera St. Branch
Collateral? :: Yes

Down Payment? :: Yes

If down payment, how much? Explain please. :: $50,000 down which is cash money.

Do you a have co-signer or co-borrower? :: No and not required.

Employment Background :: School teacher in SLO, at Hawthorne Elementary School.

Used Boat Loan for $112,000 In San Luis Obispo, California (approval/denial outcome)

Loan Officer Conclusion(s) :: Loan denied based on applicants DTI (debt to income ratio) After mortgage and child support the applicant does not have sufficient monthly income to consider this loan.

Used Boat Loan for $112,000 In San Luis Obispo, California (APR Table)

Below is an APR table we have created using the CLF loan calculator using three different APRs. You can use the same calculator yourself below for any kind of loan you may be crunching the numbers on. You test different APRs and different payment schedules yourself if you wish. It’s of course free to use. I would suggest using the loan calculator before to look at some different payment scenarios before you even consider applying for a loan, whether that be a boat loan, an RV loan, or a personal loan.

You really need to understand what you are getting yourself in to as far as monthly payments are considered. The other thing is that if you want to buy a recreational vehicle (boat or RV, etc.) you must consider how much you are ACTUALLY going to be able to use the “toy” in question. My husband and I own a 24 foot RV and we use it ALLOT, and we write it off our taxes because we use it for business. In that case it’s worth the never ending monthly payments. Heck, our home mortgage has a shorter term on it than the RV. Anyway, below is the table we set up for your review;


Category: Boat Loan (used) APR 7% APR 8% APR 9%
Loan Principal $112,000 $112,000 $112,000
Payment Schedule Monthly Monthly Biweekly
Length of Term 30 Years 25 Years 20 Years
Amount to be paid $229,922.19 $224,368.39 $212,993.41
Total interest paid $117,922.19 $112,368.39 $100,993.41
Paid per installment $629.92 $737.65 $408.48