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Old 28-01-2009, 17:33   #46
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Peter,

I'm very glad that worked out for you. Really.

But, it's exactly the kind of arrangement to which I was referring in the cautionary note above.

With you as the title holder all that time, you were also potentially liable for any damage the boat did to others or to the environment.

That's a mighty big risk to take these days, IMHO.

Bill
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Old 26-02-2009, 09:11   #47
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A fellow cruiser sold his boat financing the buyer. Long story short, after only 3 monthly payments buddy disappears. Luckily for my friend he spotted the boat for sale at a local broker 8 months later. After a some paperwork and probably a lawyer, things worked out for him in the end. My answer is no, I would not finance the buyer, if he cannot get the money from the bank (wether a boat loan, second mortage, or line of credit), what makes me think I know more than the banks in assuming this risk? When the bills start pileing up who do you think gets the shaft, the bank, or some guy you owe money too?
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Old 26-02-2009, 10:19   #48
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Unhappy Yea Right....

it is approcahing 2 years since the guy has had my 1985 38 foot Beneteau and I have not seen a penny. She was a nice boat and he is somewhere in the northeast with a free boat.
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Old 26-02-2009, 12:33   #49
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The hapless seller was deemed to be liable, and was hit for the costs of cleanup, refloating of the vessel, fines, past dockage, etc. It was a terrible case which also resulted in the guy losing his new boat....along with his shirt!
It points out that you need a real process. You need to US Document the boat and record the mortgage. The buyer then owns the boat but it is encumbered by the recorded lien. Just like a car loan. Next you secure collateral that does not include the boat. Boat sinks in the slip you can't be sued because the buyer holds the title but could not legally sell it. You lose the boat and collect the collateral. The issue of vicarious liability has come up with car leases. It may yet destroy that business. When you hold the title you are leasing the boat with conditions. For folks still working daily and have assests and a job you could expect them to stay around long enough to pay off the boat but life happens. They say screw it and quit the job and sail off.

The worst thing to do is to hold the title yourself. You still own the boat and have entrusted it to someone you don't know. Boat sinks and you clean up the mess your boat made. Your buyer never owned it and they walk away. Given this is Cruisers Forum I just can't see selling a boat and holding a note with someone that sold evrything they own and sails off.

Banks write a lot of loans and can expect a percentage of failures. You can't really expect a failure and carry the most risk.
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Old 26-02-2009, 19:54   #50
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I purchased 2 nice sailboats with owner financing.

The first was 50% down from a very fine gentleman basically on a handshake, I made every payment on time as I deeply respected his trust in me, we became great friends.
The second was from someone that had to leave the area in a hurry, life changing circumstances, I got the boat for 10% of it's value and still had to finance some. The individual left town a few days later and I sent the balance soon after. I had no contract, the boat was registered and titled in my name.
I don't piss around when someone has faith in me.

We are shopping for a bluewater boat, the right person with the right boat will know immediately what I am about.
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Old 26-02-2009, 20:13   #51
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I had no contract, the boat was registered and titled in my name.
I don't piss around when someone has faith in me.
If there were more folks like you - there would be. Sometimes rare is a good thing.
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Old 26-02-2009, 23:35   #52
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I looked at a boat a few years ago, even made it to the survey, before I decided not to buy it. Anyway the boat wound up being returned to the original owner because I didn't buy it. This was the second time the original owner had gotten the boat back because people he sold it to with owner financing couldn't make the payments.


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Old 19-09-2010, 13:39   #53
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I sell capitol automotive service equipment. The range is $3000 to $250000. These deals are called "lease to purchase". The purchaser "rents" the product from the seller for an agreed amount of time. This usually runs from 6 months to 72 months. The purchaser then buys the lease for $1.00 & then owns the product. A 60 month lease costs about $200. per $10,000. A simple example is a $20000 boat would cost $400 per month for 60 months and the 61st payment would be $1.00 to "buy the paper" I would say that owner financing could work very well with a lease to purchase deal.
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