Cruisers Forum
 


Join CruisersForum Today

Reply
 
Thread Tools Rate Thread Display Modes
Old 06-01-2016, 06:21   #1
Registered User

Join Date: May 2013
Posts: 6
1st purchase of used vessel

Hello,
I'm looking for some help/advice for first time buyers.
I'm attempting to do a purchase without a broker, but also have not purchased a sailboat before.

My drivers license is in Tennessee, I'm currently temporarily in Florida, and found a vessel in Maryland. The boat will stay in Florida (I'm not sure this is relevant but didn't know if it would add any complexity for a purchase)

Are there some contracts one can print out that are feasible for such a transaction or are they even needed? I read people putting a boat under contract over and over but I also read where people buy boats like used cars and no contract needed.

Do you have to get attorneys involved and escrow accounts or can this be a very smooth transaction?

I have contaced Essex Credit, and they have a service for completing the USCG documentation, lien checks, etc.

After that, anyone have good experience or current insurance with Florida insurers on sailboats they would like to share details/contact info?

Thanks in advance
__________________

__________________
IslanderWannaBe is offline   Reply With Quote
Old 06-01-2016, 07:32   #2
Registered User

Join Date: Apr 2014
Location: Lancaster Co., PA/North East, MD
Boat: Watkins 27
Posts: 107
Send a message via Yahoo to deltaten
Re: 1st purchase of used vessel

What? No boats available in Florida?
One of the major requirements in making the decision on my first/last/only boat was location. If I could not get it to home port alone, in reasonable time and condition; it went off the list.

I "self" surveyed and did the negotiations. Paid cash. Stayed on budget. "Sight unseen"?? No way! I suppose that IF a boat was available aka huge discount (for some reason) that it was still a bargain AFTER a complete refit..mebbe worth persuing?

YMMV, after all, it depends on use, placement and your tastes and budget.
__________________

__________________
deltaten is offline   Reply With Quote
Old 06-01-2016, 07:34   #3
Moderator
 
a64pilot's Avatar

Cruisers Forum Supporter

Join Date: Oct 2013
Location: Albany Ga.
Boat: Island Packet 38
Posts: 17,068
Re: 1st purchase of used vessel

Find yourself a good buyers Broker, they get half the commission from the seller, so they don't cost you anything unless your buying a for sale by owner boat, and they have all the answers.
__________________
a64pilot is offline   Reply With Quote
Old 06-01-2016, 07:38   #4
Registered User

Join Date: Jan 2015
Posts: 278
Re: 1st purchase of used vessel

My drivers license is in Tennessee, I'm currently temporarily in Florida, and found a vessel in Maryland. The boat will stay in Florida (I'm not sure this is relevant but didn't know if it would add any complexity for a purchase)


Very relevant. Register in Florida, and pay sales taxes in Florida. You can search the internet for a boat sales contract. Is the boat already USCG documented? If so, you can print their forms from the net, as those are the important ones for title.
__________________
WindwardPrinces is offline   Reply With Quote
Old 06-01-2016, 07:50   #5
Registered User

Join Date: Jan 2015
Posts: 278
Re: 1st purchase of used vessel

Quote:
Originally Posted by a64pilot View Post
Find yourself a good buyers Broker, they get half the commission from the seller, so they don't cost you anything unless your buying a for sale by owner boat, and they have all the answers.
They can save you some headaches, and they might save you some money, but the part about not costing you anything isn't really true. They're getting paid out of YOUR transaction. You're the one buying the boat, so it's really your money.

It all depends on if you think you can convince the selling broker to cut his commission by the amount he'd have had to pay another broker. It also depends on if you think a buyer broker is worth 5% of your transaction.

All of this hinges on your negotiation ability, but don't go in thinking that buyer brokers are "free". They're not, and you are the one paying them.
__________________
WindwardPrinces is offline   Reply With Quote
Old 06-01-2016, 08:04   #6
Registered User

Join Date: Oct 2014
Location: Caribbean - currently cruising Virgin Islands
Boat: Lagoon 39
Posts: 129
Re: 1st purchase of used vessel

Here are a couple of tips:

If a boat is USCG documented, to determine simply check the USCG website using boats name. A USCG title abstract is easily obtained online for $25. This is a very simple process to obtain, and my experience I receive these electronic abstracts usually within 48 business hours. Also, I've found getting a USCG employee on the phone, they will give provide you the specific form numbers for conducting a transaction and recording with the USCG. Their site also provides this information. USCG forms include Bill of Sale, and Change of Ownership / Boat Name Change. Total cost for documentation and filing directly to USCG runs roughly $125 and you can do this yourself. Vendors typically charge $400-$500 for same thing.

Sales Tax Issue on Purchase - Most buyers look for ways to reduce or eliminate this cost entirely, myself included. After what I feel is a tremendous amount of research and talking to experts I've come to the conclusion to simply pay the tax and be done with it. States have tightened up these regulations and closed nearly if not all the loop holes. Yes, you can bring a boat to Florida and use it within Florida waters for 180 days if you file for a permit which can cost approximately $400, unless if you have previously registered the boat in another state taxing authority. Only way I know to avoid this fee is to demonstrate that you have paid sales tax to another governing authority. Prior to six months the boat needs to leave Florida waters or you need to State register the boat in Florida. Florida sales tax is approximately 6.5% on purchase with maximum sales tax of $15,000 on purchase. Local county tax officials are responsible for collecting the tax and will issue a decal to be affixed to the boat.

You can avoid sales tax if you conduct the purchase in international waters provided that this process is video taped and well documented. Only problem with this solution, when you enter border countries to the US their custom officials will ask to see documents proving that you paid sales tax, otherwise they will most likely attempt to collect a tax. This is why I advise to go ahead and bite the bullet and budget sales tax costs.

Seek a lot of advice of knowledgeable individuals including buyer's brokers. Don't be in a haste to purchase a boat, get to know various brands, their pros and cons, and determine for yourself what is your criteria in a boat and how you intend to use e.g. coastal cruising or bluewater?
__________________
faa50 is offline   Reply With Quote
Old 06-01-2016, 08:44   #7
Registered User

Join Date: Mar 2015
Location: channel islands
Boat: lancer 36
Posts: 268
Re: 1st purchase of used vessel

Quote:
Originally Posted by IslanderWannaBe View Post
Hello,
I'm looking for some help/advice for first time buyers.
I'm attempting to do a purchase without a broker, but also have not purchased a sailboat before.

My drivers license is in Tennessee, I'm currently temporarily in Florida, and found a vessel in Maryland. The boat will stay in Florida (I'm not sure this is relevant but didn't know if it would add any complexity for a purchase)

Are there some contracts one can print out that are feasible for such a transaction or are they even needed? I read people putting a boat under contract over and over but I also read where people buy boats like used cars and no contract needed.

Do you have to get attorneys involved and escrow accounts or can this be a very smooth transaction?

I have contaced Essex Credit, and they have a service for completing the USCG documentation, lien checks, etc.

After that, anyone have good experience or current insurance with Florida insurers on sailboats they would like to share details/contact info?

Thanks in advance
why purchase without a broker??? the seller pays broker commissions and a good broker will have all of the contracts and escrow accounts you'll ever need not to mention any number of boats available that fit your needs. and he will have agents that regularly handle coast guard documentation. if he hasn't listed a boat that interests you he'll find another boat listed by another broker and split the fee that the seller pays. to insure a used boat you'll need a surveyor and a reputable broker will refer you to several in your area for you to choose from. would you look for a house to buy without a good real estate agent??? you could of course but why would you???
__________________
jrbogie is offline   Reply With Quote
Old 06-01-2016, 08:57   #8
Registered User

Join Date: Mar 2015
Location: channel islands
Boat: lancer 36
Posts: 268
Re: 1st purchase of used vessel

Quote:
Originally Posted by WindwardPrinces View Post
They can save you some headaches, and they might save you some money, but the part about not costing you anything isn't really true. They're getting paid out of YOUR transaction. You're the one buying the boat, so it's really your money.
true but how many boats will he have to choose from that are not listed by a broker? what the seller wants to get to recover his selling costs is of no concern to the buyer. all that matters is that the buyer pays what value he puts on the boat. if two boats are sold for 20 k, one listed by a broker, the other for sail by owner, what does it matter to the buyer how much the seller puts in his pocket after everything is said and done? besides, if a seller wants to negotiate broker fees to make a sale happen, it's the broker's problem to deal with the seller, not the buyers. stay strong and you'll pay the right price.
__________________
jrbogie is offline   Reply With Quote
Old 06-01-2016, 09:13   #9
Registered User
 
UNCIVILIZED's Avatar

Join Date: Jun 2014
Location: Up the mast, looking for clean wind.
Boat: Currently Shopping, & Heavily in LUST!
Posts: 5,629
Re: 1st purchase of used vessel

I'm no expert on these things (although I wouldn't mind learning more). But you want to make sure that there aren't any Liens on the vessel. Plus, that you & the buyer, both sign off on the steps involved in the buying process:
- Standard Survey
- Engine (Mechanical) Survey
- Rigging Survey
- Sail(s) Survey
- Sea Trial
- Contractual Inventory of Equipment (Sails, Lines, Safety Equip, et. all)
- Funds Transfer(s) & Escrow (if any)
- Title Transfers
- Moorage/Dockage after sale
- & Insurance During the Process

Plus a bunch of other things which I likely forgot, & or don't know about (but would like to).

But then too, much of how much or little of this stuff needs to be on paper, hinges upon the personalities & honor of the folks involved. As, in the legal sense, you could practically buy a boat, over a beer, with the paperwork being worked out on a cocktail napkin.
I know guys that have done it, & it worked out great for them. And then others who've done everything "right", & it worked out abysmally ;-)

Other than Googling stuff like Boat Buying Contracts, Title Searches, & Maritime Liens, I suppose it'd be good to spend a couple of hours a day, on different days, studying on how to become a boat broker. In order, perhaps to learn some more of what they know, & have to learn, in order to become brokers. Though, I'm thinking that in reality, there probably aren't nearly so many "hoops" to jump through in becoming one, as there is OTJ Training, & taking some learning via hard knocks along the way.
Ergo, the above comments ffor finding a Buyer's Broker, most likely.

If you'd be so kind, I'd be curious to know some of what you learn. And also, how things turn out.
What's the boat, BTW?
__________________

The Uncommon Thing, The Hard Thing, The Important Thing (in Life): Making Promises to Yourself, And Keeping Them.
UNCIVILIZED is offline   Reply With Quote
Old 06-01-2016, 09:16   #10
Registered User
 
Scout 30's Avatar

Join Date: Oct 2014
Location: Florida
Boat: Scout 30
Posts: 2,358
Re: 1st purchase of used vessel

Quote:
Originally Posted by WindwardPrinces View Post
They can save you some headaches, and they might save you some money, but the part about not costing you anything isn't really true. They're getting paid out of YOUR transaction. You're the one buying the boat, so it's really your money.

It all depends on if you think you can convince the selling broker to cut his commission by the amount he'd have had to pay another broker. It also depends on if you think a buyer broker is worth 5% of your transaction.

All of this hinges on your negotiation ability, but don't go in thinking that buyer brokers are "free". They're not, and you are the one paying them.
Strange logic. After you pay the seller for the boat the money you paid him is not yours any longer. What he does with that money is not your concern. Whether his broker gets the full commission or splits it with your broker is not your concern. Either way the seller is out the commission, not the buyer. Of course if the boat is a FSBO you would be on the hook for your broker's commission.
__________________
Scout 30 is offline   Reply With Quote
Old 06-01-2016, 09:26   #11
Moderator
 
a64pilot's Avatar

Cruisers Forum Supporter

Join Date: Oct 2013
Location: Albany Ga.
Boat: Island Packet 38
Posts: 17,068
Re: 1st purchase of used vessel

You are of course paying all fees associated with the transaction.
But if the for sale boat has a Broker, then 10% is going to brokers fees, the only question as I understand it is if you have a Broker, then they split that 10%, if you don't then the sellers Broker is very happy as they don't split that commission.
Either way, 10% of the money you pay for the boat is going to a Broker, whether you have one or not.
Now if it's FSBO, then that is of course different.
I started out my search without a Broker and eventually ended up with one.
Many, many sales Brokers wouldn't even return my calls, I believe they get so many tire kickers and dreamers that unless another Broker contacts them, they don't bother.

I think it really does depend on how expensive a boat your looking for too. A $10,000 boat is different than a $100,000 boat
__________________
a64pilot is offline   Reply With Quote
Old 06-01-2016, 09:26   #12
Registered User

Join Date: Jan 2015
Posts: 278
Re: 1st purchase of used vessel

Quote:
Originally Posted by Scout 30 View Post
Strange logic. After you pay the seller for the boat the money you paid him is not yours any longer. What he does with that money is not your concern. Whether his broker gets the full commission or splits it with your broker is not your concern. Either way the seller is out the commission, not the buyer. Of course if the boat is a FSBO you would be on the hook for your broker's commission.

The odd logic is thinking that a broker or team of brokers that are charging you 10% are "free". If they're coming out of your deal, you're paying them.

You're negotiating a bargain with a seller. Your job is to get him to accept the lowest price, his is to get the most money for his boat. The brokers are middle men.

Part of my "strange" logic is only the assumption that a boat purchase is a negotiation, which it is. The broker's commission is negotiable. My only assumption is that the selling broker is willing to give you a discount in the amount that he'd have paid a buyer's broker. Maybe he will, maybe he won't. If he won't, you can always offer to bring your own broker to facilitate your part of the deal.

Regardless of any of that, a buyer broker isn't free. His fee is coming out of your transaction.
__________________
WindwardPrinces is offline   Reply With Quote
Old 06-01-2016, 09:39   #13
Registered User

Join Date: Oct 2014
Location: Caribbean - currently cruising Virgin Islands
Boat: Lagoon 39
Posts: 129
Re: 1st purchase of used vessel

Any way you cut it commissions are a transaction cost, plan and simple.

Just as in buying a home, typically sophisticated buyers reduce a seller's asking price by the commission amount when "home sold by owner" and the same is true for buying boats. So again who really pays the transaction cost. Its not a mystery.

In regard to using a buyer's broker - generally, boat brokerage firms use a purchase agreement form that includes a section that requires a buyer to agree not to hold the selling or listing broker accountable for anything they have said or communicated to the buyer. Read that again.

Now, how much faith or trust is wise to place in comments by brokers who require you to agree to not hold the brokers accountable for what they have said about the boat? Typically, brokers follow this contract provision with the statement that buyers are responsible for conducting their own due diligence. This is current industry brokerage practice. Oh and by the way a buyer is still paying them if you buy the boat.

This is not to say brokers don't add value and assistance to potential buyers, many can and do, but buyers need to be aware of industry practices and norms and take the necessary precautions.
__________________
faa50 is offline   Reply With Quote
Old 06-01-2016, 09:42   #14
Registered User

Join Date: Feb 2014
Location: Deltaville, VA
Boat: Moody M46 46
Posts: 263
Re: 1st purchase of used vessel

Of course the buyer is paying the broker fee. A seller's broker is by law duty bound to do his utmost for the seller; a buyer's broker is by law duty bound to do his utmost for the buyer. People who try to sell their own boats usually do not discount them by the 10% broker's fee, passing that on to you the buyer.

As a "newbie," I'd recommend getting a buyer broker. As you can tell from the messages on this topic, there is a lot to inspecting, buying, titling, and moving your boat. Then come taxes. And that is only if you know you exactly what make and model boat you want. A buyer broker can help you there, steering you away from boats that are not appropriate or known to have issues.

Buying a boat for most people is a big transaction involving significant emotional and financial stress. If you know what you are doing, it can be fun and exciting. But there are an awful lot of moving objects that have to be brought into formation to make it work to your advantage, and a buyer broker can help. You are on your own otherwise in a game where the odds are against a newbie.
__________________
Moody46CC is offline   Reply With Quote
Old 06-01-2016, 09:43   #15
Registered User

Join Date: Mar 2015
Location: channel islands
Boat: lancer 36
Posts: 268
Re: 1st purchase of used vessel

Quote:
Originally Posted by WindwardPrinces View Post
The odd logic is thinking that a broker or team of brokers that are charging you 10% are "free". If they're coming out of your deal, you're paying them.

You're negotiating a bargain with a seller. Your job is to get him to accept the lowest price, his is to get the most money for his boat. The brokers are middle men.

Part of my "strange" logic is only the assumption that a boat purchase is a negotiation, which it is. The broker's commission is negotiable. My only assumption is that the selling broker is willing to give you a discount in the amount that he'd have paid a buyer's broker. Maybe he will, maybe he won't. If he won't, you can always offer to bring your own broker to facilitate your part of the deal.

Regardless of any of that, a buyer broker isn't free. His fee is coming out of your transaction.
of course brokers don't work for free but why does the buyer care if the purchase price he settles on is fair value for him? again, if one buyer buys a boat for 20k for sale by owner and another buyer buys a boat for the same price listed by a broker why does either buyer give a damn what the seller nets??? 20k is what buyer pays whether the seller puts 20k in his pocket or only 18k. we can define what goes into the price of the boat all day long be it commissions, recent bottom paint, number of winches or the love of the seller of a boat who won't budge on the price but when all is said and done what value the buyer puts on the boat is all that matters.
__________________

__________________
jrbogie is offline   Reply With Quote
Reply

Tags
purchase

Thread Tools
Display Modes Rate This Thread
Rate This Thread:

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Dual Vessel Views -vs- Single Vessel View on Dual Cummings MV WOLFPACK Marine Electronics 0 12-04-2014 07:45
1st Post, and 1st Step into our Journey to Realize our Dream ricksieminski Multihull Sailboats 19 22-02-2014 12:42
1st timer - reluctant 1st mate Ilmfj001 Liveaboard's Forum 47 08-10-2012 01:40
Vessel on a Vessel rj_whitten Plumbing Systems and Fixtures 7 27-03-2011 09:10
Please review: 1st boat purchase 28' Beneteau First 285 marty9876 Monohull Sailboats 23 01-04-2008 19:59



Copyright 2002- Social Knowledge, LLC All Rights Reserved.

All times are GMT -7. The time now is 22:48.


Google+
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.
Social Knowledge Networks
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.

ShowCase vBulletin Plugins by Drive Thru Online, Inc.