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9:01 AM Sat 15 Nov 2008 GMT
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Start Shopping! - Despite media reports around the world of a "credit freeze" affecting home loans, in the United States marine lenders are still making boat loans - and buyers are finding some great buys in the current market, so maybe it's the right time to consider buying, no matter where you live.
Uncertain times are certainly at hand. The world's stock markets have seen their share of ups and downs. Some major U.S. banks have failed; others are in the midst of bailouts. Both US and international media are running numerous stories about a massive "credit freeze" affecting many prospective home buyers.
But opportunity often abounds in the midst of chaos -- and, right now, boaters looking to upgrade may find once-in-a-lifetime opportunities to acquire the boats of their dreams. Here's why:
As the nation's economic jitters persist, more and more used boats are hitting the marketplace, creating a buyers' market. Economic uncertainty also puts the binders on new boat sales: As new boat inventories backlog, and as dealerships consolidate, may dealers are offering special price incentives. New or used: it's a perfect opportunity to "strike while the iron's hot."
But are those reports of a "credit freeze" true for boaters, as well as home buyers? After all, if it's true that banks aren't lending, what good is a buyers' market?
Don't believe all those reports of a "freeze," marine lenders told The Log. For qualified boat buyers, attractive financing is still available.
"We were at our booth at the Long Beach Boat Show last month, and a couple walked up," said Michael Bryant, vice president of Trident Funding, which has 13 locations nationwide. "They looked at our sign and did a double take. With all the negative press they'd been reading, they thought nobody was making boat loans."
While some lenders have retreated from the boat market (Key Bank, Citizen's Bank of Rhode Island and Wachovia, to name a few), those who remain are specialists in marine lending, and they are very willing to fund loans for solid applicants.
"While we keep hearing nightmares about real estate financing, there are six or seven really strong banks that are still heavily involved and committed to doing boat loans," explained Joni Geis, marine loan officer at Dimen Marine Financial Group.
But in these uncertain times, boat financing rules have subtly changed. Knowing the score can help prospective boat buyers take advantage of a great buying opportunity.
In this present environment, lenders are likely to scrutinize applications more thoroughly than in the past, according to Bryant. In order to insulate themselves better from fraud, underwriters are more likely to do things such as crosschecking phone numbers and addresses on the credit application with those listed with major credit reporting agencies. To weed out the "bad guys," lenders may also consult online maps to make sure physical addresses exist.
One big change over recent years is in "stated income" loans, where applicants once simply stated their income to the lender without providing backup documents. Even "good guys" might have difficulties today obtaining loans based on stated income.
Loans not requiring income verification "are still out there, but much of the industry has gone back to the basics, and wants to see proof of income with tax returns," Geis said.
To learn about 'Playing Percentages' when buying a boat, go to The Log
by Jack Innis, The Log/Sail-World
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