Which is more desirable to a lender?

[Bowhunter74201]

which would most lenders prefer? paying off a large portion of debt and putting a smaller down payment on a new boat (bigger loan). or, paying off a smaller portion of debt but putting down a larger down payment on new boat (smaller loan)?

[LLewellin]

Originally Posted by Bowhunter74201

which would most lenders prefer? paying off a large portion of debt and putting a smaller down payment on a new boat (bigger loan). or, paying off a smaller portion of debt but putting down a larger down payment on new boat (smaller loan)?

I would think they, the lenders, would want as much down as possible. They will have a lien on the boat and the more collateral, the portion of the boat that is paid for, the better. IMHO

[Bowhunter74201]

good point...

[reclending]

Originally Posted by Bowhunter74201

which would most lenders prefer? paying off a large portion of debt and putting a smaller down payment on a new boat (bigger loan). or, paying off a smaller portion of debt but putting down a larger down payment on new boat (smaller loan)?

From what we find, paying down debt is a huge help. Down payment is more of a ratio between value and the amount you want to borrow. If the boat books and you are getting a "deal" the amount of down is less important. By paying down debt, especially credit card balances, the lenders like low DTI ratios. No matter your amount of down stroke, if you are paying too much for the boat they only lend what the book says it is worth. When paying off debt, sometimes it takes 30 - 45 days for the changes to show on the bureaus so remember that when applying for the loan. Let us know if we can help, Ken

[Bowhunter74201]

thanks ken, appreciate the input. will do.

[sashasuman]

Year of the boat does not really come into play for term with the lenders we use. The $$ amount dictates the term. The age will have an effect on the rate in most cases. Most lenders will charge a bit higher rate on used. Let us know how we can help.