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INDEX:
Finance application, scroll down, left side.
Index:
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What you don't know can hurt you!
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Should you incorporate?
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Are you qualified?
Calculators, forms and the real inside
information. (What the Brokers won't tell you!)
Download Application here.
Full application if you're in the process of buying:
1. Click here.
Fill out (Suggest you save a copy) then send to email below. Or, Save this to your local computer.Fill out. Save again after you fill out and email to:
kvereen@bayacht.com
Fill out using Acrobat form on your computer for auto email back, or
print and manually fill out and fax to number on application--Full
Application. (It
helps to have the free Acrobat 9 for this to work).
If filling out on line,
At the signature line, if you don't have a digital signature, you can
create it when you click, click on the third menu item to create a
signature and follow the instructions.
If you don't have it: Call if you have questions: 410-263-2311 Kris Vereen, business manager.
 If
you need to download Acrobat: You will need the latest, free
version of Acrobat (9) in order to download and fill out the forms. If
you don't have it, download
it here.
Insta-Qualification applications... For a quick, pre-approval
2. Click Here.
Acrobat-- copy, Save this to your local computer. Save after you fill
out and mail to:
kvereen@bayacht.com fill out electronically and email back or print and fax
back.
Note: Our financial analyst, Mark has has an accounting degree and has
been in the marine finance business for over 20 years. He tells us that,
"...marine financing is almost counter intuitive. You would think that
you should submit your application to multiple sources to get the best
rate. In fact, marine financing is a very small market segment and most
loan brokers use the same sources. If a broker shot-guns the application
to multiple sources, this will lower your credit score and make it less
likely for you to get the best terms. Our policy is to analyze the
application carefully, and then submit it to the one or two most likely
sources--based on our experience. This approach does not lower your
score, and assures that you get the best possible terms."
There is no cost or obligation for you to benefit from our experienced
approach. Download the simple, one page application above and get your
pre-approval so you can go forward with this important information in
place.
NOTE: We only accept applications for clients purchasing a boat from
BYA. |
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410-263-2311 |
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Should you really buy a new boat now?
The
Secrets for successful financing.
Times have never been more challenging--nor the
opportunities greater.
Here are at least 10 secrets for coming out on top--get a
great deal on your boat, but also get a great deal on financing.
 Financing
is available. Four important principals will be discussed here.
1. Why you should set up a LLC in conjunction with your
boat purchase.
2. What you need to know
before you
submit your application.
3. Normally the loan expense is the biggest expense of
boat ownership--here's a sure fire way to reduce all of your costs!
4. What you don't know, can definitely hurt you!
Please scroll down, or use the Index
Eric Smith,
President
The application:
For a quick, short form to get pre-approval--use the link left-Insta-Qualification.
For a complete application if you have already committed to a boat, use the
links below.
 Click
on the symbol to the left to get finance application, that you can email or fax back
and get the
Incorporating...information
here. or from the links below.
Return to index |
Some definitions you can use
1. Loan Broker. A person or
company that works with sales organizations or individuals and has 3-20
banks, or marine funding sources that he can submit loans to.
2. Teaser rate. A rate
that's a short term promotion that is essentially some variation of a
short term fixed/variable rate.
3. Marine loan. A loan,
much like a home loan where the boat is the collateral.
4. Liquid assets. Assets
that can be turned into cash readily: Cash, money market accounts, even
stocks or bonds.
5. Rebates. Often
available from the dealer or manufacturer. Judiciously applied, they can
reduce your downpayment.
6. Turn down. When a bank
declines an application. This has serious repercussions. Shows up on
your credit report and Reduces your credit score. In todays climate, it
can be deadly and greatly reduce your chances of getting a marine loan
at all, or cause the rate to be increased substantially--many fewer
banks will even consider a client with a turn-down on their credit
report.
NOTE:
If you're reluctant to give confidential information to your dealer,
know that in our case, it goes to our business manager, is
reviewed by key people at our office so that we can determine which
financial source to submit to in order to avoid a
turn down.
In the case of your setting up a boat in our Boat-As-A-Business
program, we are going to need the loan information, and possibly even
information from your tax returns, in order to run a required (by IRS)
business plan. See (3) are you qualified for more.
Click
on the symbol to the left to get finance application, that you can email or fax
back
and get the
Incorporating...information
here. or from the links below.
To get a finance
application that you can fill out in a acrobat form format so you can email
or fax it back, click here. (to
insure privacy, don't fill in the last 4 digits of your SS number--send that
info separately with only those digits in the body of your message.)
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1. What you don't know--can hurt you!
Some of these comments may sound self-serving, but in 37 years I have seen
people lose money and opportunities by not taking heed of these facts!
Q. It pays to shop around--right?
A. Surprisingly, often not. What do I mean? We
recently got an approval for a client but he insisted on shopping for a
better rate. What he didn't understand is that most
loan Brokers use the
same banks. The second application ended up going to the same bank our
loan broker submitted the application to. The second
Loan Broker filled in
some slightly different information on the application. Result? The bank
lost trust in the client and gave him a
turn down. With a
turn down on his credit report, he ended up
with a significantly higher rate. (On one application, there was simply
a check box for "Are you a U.S. Citizen" On the other the question was
asked "What is your nationality" Same information, different emphasis to
the bank!
Q. At the boat show, I had offers from several
Loan Brokers
with a very good rate--and they said they could finance my boat even
though I was putting it in charter. Is that a good deal?
A. Loan Brokers
do often offer slightly better rates during boat
shows. But, because of the competition they also offer various
teaser rate programs.
By the time you figure it all out, you're worn out and they get you as a
client. Virtually none of them have a real "charter program, rate".
Q. The bank wants me to federally document the boat. Is that a good
thing?A. It's required so that they can get a federally registered lien
on your boat--good for them, but also good for you. (See note about
setting up an LLC)
Q. I'm thinking of getting a home equity loan, or
using my business line of credit. Why should I get a
Marine Loan?
A. The chief advantage is that you leave your other lines of credit free
for other purposes. With a Marine Loan, your boat is your collateral.
Q. Can I use any
rebates I get to help reduce the
Downpayment?
A. The bank will look at your liquid assets. If you
have enough liquid that you could make the full downpayment without
using the rebate,
then they may allow you to use some portion of a
rebate to reduce your
downpayment--generally no more than 5-10% or so at most in today's
market. The important thing is that a good dealer can feel the bank out
in advance, or find the right source, to get you to a source that will
work with you.
Q. Why having your dealer help you choose the financing source?
A. Many of the banks that finance boats have a public outlet and a dealer
outlet. I've seen clients go to a bank and get quoted a high rate, or
told that they're not qualified, and then come to us and we work with
the dealer division (of the same bank--kind of the secret back door!)
and with much more knowledgeable people and we get clients financed at a
lower rate. A good dealer has more sources and can better match an
individual clients situation with the right bank, and, he can also help
integrate rebates into the equation.
Q. How can I improve my chances?
A. Enter into an actual sales agreement with a
refundable deposit--these finance guys don't have time to waste on
people that are just curious and they want to know
that you're serious. Work with a dealer who will submit the application
to the right funding source to start with. Cooperate, promptly with
requests from the funding source. Dig out 2 years tax returns in advance
and have them ready. SSee (3)
are you qualified for more
Bottom line. Some dealers do get kick backs or add something to the rate
you pay. This limits your choices because they only work with banks that
will do this or who offer the best kick backs.
BYA doesn't do this. We simply look for the best rate and terms that fit
your circumstances. Because we don't limit ourselves, we have more
sources, including sources that will legitimately finance boats that
will be chartered. We offer our services to help you set up an LLC and
the financing simply to facilitate the sale. As a result, we're the
largest dealer with the best price and service guarantee for each of the
lines of boats that we sell.
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Incorporate?
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Delaware Business Inc.
Why set up a Corp. in a non-tax state, private state like DE? Includes
explanations, form to apply and more.
(Read the material, but please talk to us before you do anything! There are lots of ways to do this, and the bank has
certain requirements--we'll explain.)
Over one-half of the Fortune 500 companies and
nearly one-half of the companies listed on the New York and American Stock
Exchanges are incorporated in Delaware.
Delaware has a long history of being corporation friendly. Delaware
actively has kept its corporate laws at the leading edge of corporate
governance. You do not, however, need to be a Fortune 500 company to take
advantage of Delaware's friendly corporate laws. No matter haw small your
business, Delaware has advantages for you.
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2. Should you incorporate?
Whether
you are setting your boat up as a business or not, there are two major
advantages to incorporating:
- Some additional liability protection. It makes it more difficult for anyone trying to get a judgment against you to get to your personal assets. In
today's litigious society, you are vulnerable to everything from people walking down the dock and tripping over your
dock line, to guests on board--coming after you for more than the value of your boat.
- There may be advantages on resale. If you've paid
sales tax, you can sell the stock in the Corporation, rather than the
boat and the new owner may then not need to pay the tax again--this
makes your boat worth more at resale. There may be other advantages if
you want to get partners, etc. to just selling or exchanging stock
rather than "selling your boat". (Check with
appropriate tax authorities.)
- What incorporating in a non-tax state does not do.
Eliminate the requirement to pay the sales or use tax. Most states
require that if you stay in the state for some period of time, even if
you come from a different state, that you pay a use tax--generally the
same as the sales tax (5% in MD as this is written). There are
legitimate ways to avoid this use tax--but this is too big a subject to
cover here. Call us if you have questions--we've written a comprehensive
paper on the subject that we can make available when you're ready to
purchase a boat from us.
A word about Federal documentation...
 Generally the bank
will require Federally documenting the boat (rather than state titling). The main reason for this, rather than
accepting state titling, is that by Federally documenting, the bank gets a Preferred Ships
Mortgage filed on it's behalf. This is an internationally recognized document where as
state titles are often not even recognized from state to state.
Side benefits include:
- Lien protection (for you, and/or the buyer of your boat at resale--this enhances resale
value.)
- Easier clearing in and out of foreign ports.
- U.S. government protection in foreign waters.
- Easier to sell your federally documented boat down
the line because liens can be checked, and the bank for the next guy may
require this.
Return to index |
Get the application.
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Loan Calculator...
We will provide complete information with our own
program that will include showing you your monthly out of pocket costs
after the second home interest deduction (private owners) or with the
full tax deductions Boat as a Business.
 For a relatively
simple calculator.
(Generally try using 7%/20 years for terms as of
early 09--might be better)
Want to check your credit out--on line,
instantly? Concerned about what might be on your credit report?
Follow this link!
Get the
Incorporating...information
here. or from
the links below.
To get a finance
application that you can fill out in a acrobat form format so you can email
or fax it back, (Open the document and save it to your local computer. Fill it out, save it again for your records and email or fax it per instructions) click here. (to
insure privacy, don't fill in the last 4 digits of your SS number--send that
info separately with only those digits in the body of your message.)
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3. Are you qualified
There are a number of criteria that the bank will look at and that you can
evaluate yourself in advance. Why bother? Because if you get a Turn down
for any reason, it makes it much harder to go to another source.
The criteria vary, but in general:
- You need to show liquid assets that will cover the
required downpayment--generally 15-20%.
- Good or excellent credit and a relatively high
credit score. In today's climate, the requirements are more stringent.
- You need a debt to income ratio of about
40%--including the boat payment on your debt side.
- Proof of income--in today's tight market, we even
had a doctor need to take her diploma off the wall, scan it and send it
to the bank. The documentation requirements are sometimes onerous--plow
through.
- Boating experience. Helps. Don't have it, we can
show that you're signed up for an ASA certified course and, believe it
or not, that helps!
- High credit card debt, low net worth, a boat to
sell, high credit not at least equal to the cost of the new boat, in
your current house less than 2 years, or current job, less than 2
years--are all negatives and may limit the finance choices.
What the bank will want:
Loan application. Ours in generic so that we can
submit it to any source that proves to be the right source--do not fill
out a specific bank application!
2 years tax returns--complete, all pages. If in
business for yourself, personal and business returns.
They may ask for other documentation as things
progress.
Return to index |
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brochures, in
depth articles, business plans, pre-announcement of new models and charter
specials and more.
