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Old 02-06-2011, 08:56   #1
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Buying Without a Broker

I'm planning on buying my first cruiser this summer and there are those interesting boats advertised by private parties. I have read of horror stories where people have purchased boats only to find out that there is a mechanics lien or some other issue after the sale has been completed. So, have any members used a title or closing service similar to that used in real estate and what was the cost and was it worth it? I'm in the states but am also interested in how it works worldwide. BOB
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Old 04-06-2011, 08:57   #2
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Transaction fees?

OK, so I'm the only one to reply to my own post but still I beleive this is relevant. As I understand it when buying a boat in the states one would transfer basically a state vehicle title. On a 6 figure purchase is that all that is done? I'm aware of coast guard docs but I have been led to beleive that the state title proves and transfers ownership. Say I was interested in a private foreign purchase, who does the docs and escrow? Any companies that are trustworthy and what are the fees? If you purchased a boat through a broker did you incur any doc or escrow fees outside of the brokers commission which was paid by the seller. Anybody? BOB
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Old 04-06-2011, 09:02   #3
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Re: Buying without a broker

Brokers are only good for opening the marina gate. If you have title concerns you should contact a marine attorney. Yes, a bill of sale and state registration is usually all it takes....to attract the attention of all the tax authorities
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Old 04-06-2011, 09:09   #4
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Re: Buying without a broker

To clarify, if the boat is State Titled then you can effect the purchase by filling out the back side of the State Title and take it to the appropriate State motor vehicle office for filing and issuance of a new title in your name.
- - However, for USCG documented boats, the process is somewhat similar in that the back of the USCG Documentation certificate includes a section for transferring ownership. Further detailed instructions are contained on the USCG Vessel Documentation website.
- - Purchasing a foreign owned/registered/documented boat is a whole different situation and although you can probably successfully navigate the process, an experienced broker can save a lot to time and sweat.
- - There are quite a number of "complications" involved in purchasing a boat which range from mechanic liens to State Sales taxes. Besides finding boats that you might be interested in purchasing, the Broker can also guide you through the process of successfully complying with all the Tax and other surrounding complications of transferring ownership.
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Old 04-06-2011, 09:11   #5
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I used a broker for a private sale....I was scared to give a total stranger a deposit and possibly losing it. Everything worked out great and all the proper paperwork was done and I had piece of mind.
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Old 04-06-2011, 10:02   #6
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Re: Buying without a broker

Lost, please elaborate. What were the fees? Who paid what? Were the fees set or based on purchase price? Where were you, the boat, seller, and broker? Thank you BOB
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Old 04-06-2011, 10:11   #7
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Re: Buying without a broker

We used a broker buying our last boat, and with his knowledge there was undisclosed liens. A broker doesn't a clean title make. 3 months straightening out the lien, 6 months straightening out the erronious Docs, finally got clean title last week. During this process contacted the broker several times and he washed his hands of the whole procedure, we were on our own. Brokers are not the cure all, dealing with people of good character is.On the other hand, we sold a boat three weeks ago, cashiers cheque and our word the title is clean made the deal.
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Old 04-06-2011, 15:04   #8
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Re: Buying without a broker

This is what I learned in twenty years of buying and selling eight boats and working as a broker for one year.

A USCG documented boat title trumps a state title. Some boats have both.

Neither a state or federal title protects you from mechanics, yard, salvage claims, etc. All are automatically in effect until adjuticated and are not required to be filed. So there is no way of checking for them. They go with the boat, not the owner when the debt was incurred.

You can buy boat title insurance just like real estate. Most brokers think it is near worthless as there are so many exclusions.

There are documentation services. Atlantic Boat Documentation in Annapolis is one. I don't think that they act as an escrow service. Brokers do this. BoatUS has an escrow service that some say works well.

And finally why not look at boats represented by brokers. You may find just what you want at a good price. For sale by owner does not always indicate a bargain.
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Old 04-06-2011, 15:45   #9
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Re: Buying without a broker

Quote:
Originally Posted by djmarchand View Post
why not look at boats represented by brokers. You may find just what you want at a good price. For sale by owner does not always indicate a bargain.
I'm not ruling out brokers in fact I will probably use one for the simple fact that there are more boats listed than FSBO. And the documentation process will certainly be easier. It would be nice just to sign on the dotted line. Some of those FSBOs are interesting, though.
Thanks for the help.
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Old 04-06-2011, 16:01   #10
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Re: Buying without a broker

I bought both my boats without brokers, the documented one was tough,got the proper form from seller,but found there were 3 prior owners that I didnt have paperwork from. One was an insurace company that was absolutely snotty until I contacted their underwriters who were quite helpful. After contacting them the insurance company was bending over backwards and pleading for me to contact the underwriter and tell them they had made things right.
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Old 04-06-2011, 16:38   #11
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Re: Buying without a broker

ForSail, Then, am I to understand that there must be a consistent paperwork trail from owner to owner to insure CG documentation? So then the documented boat wasn't documented? At least properly. BOB
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Old 04-06-2011, 17:29   #12
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Re: Buying without a broker

If you are not using a broker the boat will need to be cheaper to reflect this. If you aren't using one you will be up for additional legal fees so in the end costs might be similar and the advantage of the broker is that they do this all the time....
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Old 04-06-2011, 17:37   #13
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Re: Buying without a broker

Magic was totalled by the insurance company after hurricane Hugo. The boat then passed from the insurance company to a salvage company to another speculator who purchased it at an auction then was bought by me at an ebay auction. I was required to produce official notarized coast guard bills of sale from all the owners from the last time the boat was documented.
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Old 08-06-2011, 01:05   #14
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Re: Buying Without a Broker

I too am boat shopping. I agree with Lostatsea 2011. Depending on the size of the boat. Anything under 10k I wouldn't worry. But turning over a deposit to an owner?? I prefer having a third party. I would think you could ressearch for liens yourself. If yard liens or mechanics liens haven't been filed before you transact, they are below you, in the ugly case of any civil suits. I have bought and sold seven boats. Six through brokers who have been in business for many years with respectable reputation, and happy they assisted in transaction. Often to lock a deal they may give a little on their fees or you may realize some other considerations that is valuable to you as a knew owner but easy and inexpensive for brokers to give, such as access to their wholesale prices at local chandleries. If title is available for a small fee, how much is your peace of mind worth/
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Old 09-06-2011, 10:18   #15
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Re: Buying Without a Broker

Thanks everyone. Just a few more questions. When you used a broker, were there any hidden fees other than commission, sales tax and documentation costs required by goverment entities? These are the mostly BS type of fees that the mortgage brokers and car dealers like to slip in on the contract. And were there any fees that you thought were justified? Thanks again. BOB
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