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Old 11-05-2012, 05:49   #16
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Originally Posted by dgasmd

Thanks for the suggestion

That is very good to know. However, how does that work when your broker is in a particular area and the boat is in a distant one? Say, you are in South FL as well as your buyer's broker but the boat is in NC as well as the seller's broker?
I fly up to NC. If all goes well hopefully the commision covers my costs. If not, I write it off as a vacation and keep searching for the right boat.
I wouldn't fly up for just a showing though ( no executed contract ). At that point, I would ask for a courtesy showing by the co-broker.
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Old 11-05-2012, 05:55   #17
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Re: The buying process. Talk me through it.

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Originally Posted by phiwum View Post
Golly. I am a novice sailor, ill-equipped to determine the value of a boat on my own. I need my surveyor to give me an accurate estimate of what the boat is worth. I can come up with an initial offer, but I can't be confident in its accuracy without his expert advice.

Suppose he finds some significant but not deal-killing issues. Then my previous estimate of the worth of the boat has been revised. I may be willing to buy it, but not at the previous offer. If you reject post-survey revisions in the offer out-of-hand, then neither of us will be satisfied. You'll still have a boat to sell, and I'll have to keep looking.

If, on the other hand, you hear my new offer and consider it worthwhile, then we can both be satisfied with the outcome. Perhaps you will agree that the discovered issues are significant and can understand my new estimate of the boat's worth. Perhaps not, in which case we fail to reach agreement and we're done.

But to disallow renegotiation after a survey really isn't in your interest. You end up losing deals that may have been agreeable to you.
I agree with you. Astral Blue's position is not realistic, especially in today's buyer's market. Anyone buying a cruising boat will require a survey, and not under the conditions provided. They are called a C&V - condition and VALUATION survey which a bank will require before agreeing to loan you money assuming you are not paying cash. Likely your insurance provider will also require this. Also, any offer should be made conditional on the outcome of the survey. It is common for a survey to turn up issues that need to be corrected, which may not change your mind about making the purchase, but do in fact affect the value of the boat (to the buyer anyway). That's why you need a good surveyor who knows what to look for.

Charging someone to look at the boat is also not realistic. A) that's what a broker is for, or B) if you are not using a broker, you're saving yourself the brokers fees and thus you should be willing to perform the brokers tasks.

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Old 11-05-2012, 05:58   #18
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Originally Posted by Richard Jordan

Actually when a buyer broker is involved the commision is split just like in real estate. There's no reason to pay him or her a fee although that would be a nice bonus!
Richard - I glean you are a broker and I am sure you work just as hard whether buyer or seller pays.

I would rather structure a deal as described and have the buyer broker only beholden to me and the better he performs the more he makes as opposed to the better he performs the less he makes.
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Old 11-05-2012, 05:59   #19
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Re: The buying process. Talk me through it.

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Originally Posted by Richard Jordan View Post
I fly up to NC. If all goes well hopefully the commision covers my costs. If not, I write it off as a vacation and keep searching for the right boat.
I wouldn't fly up for just a showing though ( no executed contract ). At that point, I would ask for a courtesy showing by the co-broker.
Sounds reasonable. So, let's say I go to NC, see the boat, and I am ready to make an offer. Without you, my broker, to help me decide on the offer to present since you have not seen the boat at all? So, how do I get the advice and guidance before I commit to an offer? I'm not playing the devil's advocate here. Just trying to understand how it works and trying to relate it to buying a house or similar where before I made an offer I would want my agent there to use their experience, eyes, and know of the market and such to tell me "hey, you are ridiculously low on the offer" or "you could get a better price because x/y/z". I guess this is assuming the buyer's broker will be working on my behave to get me the best deal possible.
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Old 11-05-2012, 06:07   #20
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Originally Posted by dgasmd

Sounds reasonable. So, let's say I go to NC, see the boat, and I am ready to make an offer. Without you, my broker, to help me decide on the offer to present since you have not seen the boat at all, how do I get the advice and guidance before I commit to an offer? I'm not playing the devil's advocate here. Just trying to understand how it works and trying to relate it to buying a house or similar where before I made an offer I would want my agent there to use their experience, eyes, and know of the market and such to tell me "hey, you are ridiculously low on the offer" or "you could get a better price because x/y/z". I guess this is assuming the buyer's broker will be working on my behave to get me the best deal possible.9
If Ex-Calif pays me a fee in addition to the commision, then I will go!

I think one of the best uses of a buyer's broker is when I preview listings on a buyers behalf. I can cover most of South Florida easily. Then that saves a buyer the cost of flying in from say Colorado to see a boat in Stuart. I report back with photos and pricing recommendation.
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Old 11-05-2012, 06:32   #21
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Re: The buying process. Talk me through it.

The buying project will vary as there are no two identical buyers / boats / legal systems / situations.

This is our buying story:

- found the type of the boat we wanted, on the web,
- found a couple of potentials, contacted owners,
- went to look at the boats,
- took the selected boat out on dry, had another look,
- signed the contract, no broker, no notary, no fees,
- wired the money,
- re-registered the boat in our name, then re-registered in the marina.

b.
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Old 11-05-2012, 06:33   #22
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Re: The buying process. Talk me through it.

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Originally Posted by Richard Jordan View Post
If Ex-Calif pays me a fee in addition to the commision, then I will go!

I think one of the best uses of a buyer's broker is when I preview listings on a buyers behalf. I can cover most of South Florida easily. Then that saves a buyer the cost of flying in from say Colorado to see a boat in Stuart. I report back with photos and pricing recommendation.
Yes, I can see and appreciate that. I guess out of the state/area purchases with a local to me broker will be a bit more difficult in terms of logistics. I guess no different than buying a house in NC while I am a South FL resident and have a local agent in FL.

Since you are a broker yourself, can you enlighten me in the timeline of events that occur in a purchase. 2 pages later nobody has addressed it yet

see ad>see boat>make an offer with 10% downpayment>agree in offer> THEN WHAT?????
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Old 11-05-2012, 06:37   #23
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Re: The buying process. Talk me through it.

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Originally Posted by barnakiel View Post
The buying project will vary as there are no two identical buyers / boats / legal systems / situations.

This is our buying story:

- found the type of the boat we wanted, on the web,
- found a couple of potentials, contacted owners,
- went to look at the boats,
- took the selected boat out on dry, had another look,
- signed the contract, no broker, no notary, no fees,
- wired the money,
- re-registered the boat in our name, then re-registered in the marina.

b.
-Where/who do you register the boat? Coast guard? What institution in the US (sort of like a DMV)?
-What happens when there is a broker in the other end?
-How are the funds handled if there is a lien on the boat due to an owner's loan?
-Re-registered with the marina? What does that mean? You mean you put the slip's rental on your name?
-How do you go about changing the name on the boat? What is the process for that?

BTW, I am looking at 2004 and newer production boats if that helps at all. I would venture to guess 95%+ of these owners have a loan on them.
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Old 11-05-2012, 06:56   #24
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Re: The buying process. Talk me through it.

First off, remember that if your "buyers broker" is paid by splitting the commission with the selling broker, that means that it is the seller who is paying them. That means that their "fiduciary responsibility" is to the seller, not to you!

Having said that, there may well be state laws that specify the brokers responsibilities depending on who they were contacted by and what the relationship is. I know that here in Florida brokers are pretty tightly regulated--probably more so than most states. But as a general rule you cannot just assume that the broker is "working for you" if in fact someone else is paying him.

Second, as far as financing. Are you planning on the boat being collateral for the loan? If so, you will want to talk to several lenders once you have a general idea of the kind of boat you will be buying, what your budget will be, and how much you will want to borrow. Each situation will be different, but before they will commit to the loan they will want you to have a sales contract and they will almost certainly want a survey. You will, of course, want a provision in the contract that lets you out if you cannot secure a loan.

So, basically, the process is...

1. Pre-work: search ads, contact lenders, determine your needs/wants/etc.
2. Start shopping: go out and look at boats, work with a specific broker if you want, though that's not necessary.
3. Make an offer: find a boat you like, make an offer, haggle back and forth, come to an agreement, but be sure that it is dependent on a survey, sea trial, financing, and any other contingencies that you require, and put down some "earnest money" (just like buying a house).
4. Survey and sea trial: schedule the survey and sea trial, sometimes these are both on the same day, sometimes not.
5. Renegotiate: the survey will almost always turn up at least minor things (just like the inspection on a house), you can renegotiate based on that, or walk away, or decide you are happy... whatever.
6. Secure your loan and arrange for insurance.
7. Close the deal. You're now a boat owner!
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Old 11-05-2012, 06:57   #25
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Re: The buying process. Talk me through it.

Quote:
Originally Posted by dgasmd View Post

1) Where/who do you register the boat? Coast guard? What institution in the US (sort of like a DMV)?

2) What happens when there is a broker in the other end?

3) How are the funds handled if there is a lien on the boat due to an owner's loan?

4) Re-registered with the marina? What does that mean? You mean you put the slip's rental on your name?

5) How do you go about changing the name on the boat? What is the process for that?
1) Non-US boat, registration by local maritime authority there,

2) We ticked off boats sold by brokers, we went to owners directly,

3) We got a boat owned by the owner, no banks involved,

4) Yes,

5) When we registered the boat with the maritime authorities, we gave her a new name.

PS So much hassle with registration only because we wanted to take her out.

b.
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Old 11-05-2012, 07:21   #26
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Re: The buying process. Talk me through it.

Quote:
Originally Posted by dgasmd View Post
-Where/who do you register the boat? Coast guard? What institution in the US (sort of like a DMV)?
Depends on whether you want to document it with the Coast Guard or not. Usually a good idea if you are going to be doing a lot of international sailing, but not a requirement. Then, it will depend on your state as to whether you have to register the boat or not (probably, though).
Quote:
Originally Posted by dgasmd View Post
-What happens when there is a broker in the other end?
Just like buying a house. He/she is involved in the sale and is paid by the seller.
Quote:
Originally Posted by dgasmd View Post
-How are the funds handled if there is a lien on the boat due to an owner's loan?
Again, just like a house. The contract will stipulate that "clear title" has to be provided, and the seller will be responsible for taking care of that.
Quote:
Originally Posted by dgasmd View Post
-Re-registered with the marina? What does that mean? You mean you put the slip's rental on your name?
Maybe. Depends on the marina. Some (most, I think) will let you take over the previous owners slip. Others will require that you go to the bottom of the waiting list. Worth working out where you will keep the boat before the closing.
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-How do you go about changing the name on the boat? What is the process for that?
If the boat is USCG documented, then there is paperwork required. If not, then you paint over the old name and put on the new one--nothing to it.
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Old 11-05-2012, 07:54   #27
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Re: The buying process. Talk me through it.

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Originally Posted by denverd0n View Post
First off, remember that if your "buyers broker" is paid by splitting the commission with the selling broker, that means that it is the seller who is paying them. That means that their "fiduciary responsibility" is to the seller, not to you!

Having said that, there may well be state laws that specify the brokers responsibilities depending on who they were contacted by and what the relationship is. I know that here in Florida brokers are pretty tightly regulated--probably more so than most states. But as a general rule you cannot just assume that the broker is "working for you" if in fact someone else is paying him.

Second, as far as financing. Are you planning on the boat being collateral for the loan? If so, you will want to talk to several lenders once you have a general idea of the kind of boat you will be buying, what your budget will be, and how much you will want to borrow. Each situation will be different, but before they will commit to the loan they will want you to have a sales contract and they will almost certainly want a survey. You will, of course, want a provision in the contract that lets you out if you cannot secure a loan.

So, basically, the process is...

1. Pre-work: search ads, contact lenders, determine your needs/wants/etc.
2. Start shopping: go out and look at boats, work with a specific broker if you want, though that's not necessary.
3. Make an offer: find a boat you like, make an offer, haggle back and forth, come to an agreement, but be sure that it is dependent on a survey, sea trial, financing, and any other contingencies that you require, and put down some "earnest money" (just like buying a house).
4. Survey and sea trial: schedule the survey and sea trial, sometimes these are both on the same day, sometimes not.
5. Renegotiate: the survey will almost always turn up at least minor things (just like the inspection on a house), you can renegotiate based on that, or walk away, or decide you are happy... whatever.
6. Secure your loan and arrange for insurance.
7. Close the deal. You're now a boat owner!
Fantastic!!! It only took 24 posts for someone to actually read the question and answer it Just what I was looking for
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Old 11-05-2012, 08:16   #28
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Re: The buying process. Talk me through it.

As has been said, everyone's experience is a little different. While you acknowledge that this will be your first purchasing experience, a little more information from you might help us be more helpful.
  1. Are you an experienced sailor? Lots of people have experience on other peoples' boats (OPB) that will help them quickly decide what they're looking for. If you're relatively new to sailing, do you have an experienced friend who would be willing to help you with your search? (This is not usually a burden. Most of us jump at the chance to scurry around on boats when it's someone else's money. )
  2. Are you located in an area with a lot of boats? If so, walk the docks. Talk to people. Ask them about their boats. If you start out with something like, "Beautiful boat", you're already half way to an invitation to come aboard. Most sailors are actually pretty friendly. (There are exceptions, but they're probably on line having an Internet argument. ). If you don't live in an area with a lot of cruising boats, schedule a visit and spend a weekend doing the same. Even if you're looking for a forty year old boat, going to one of the big shows can be a helpful way to see a lot of interiors in a short time. Take your spouse, but recognize the risks. Be sure to prepare her that older boats have a lot less space.
  3. What's your budget? Not specifically, but, how many 000's? Advice is different for $10K, $100K and $1 million. All are represented on this forum. If you're at the lower end of the spectrum buying an older boat, financing could be difficult. Your best route to a good rate could be a home refi if you qualify. If you're a new buyer and you're in the $100K+ range, a seller's broker can be helpful IF you can find someone through a very trusted personal recommendation. The key to having your own broker is that they can give you real guidance on the steps to get a specific boat. If you don't have grounds for a great deal of trust with the broker, you're not going to feel comfortable. As stated above, the broker is paid out of a single commission (in the US) just like real estate.
  4. Charter boat or not? If the kind of boats you're looking at are currently in charter, by all means, take the family and charter. There's nothing like a few days on board to determine what a specific boat will be like for you and them. If you're a competent sailor, but not an experienced cruiser, go to a place like the BVI and hire a captain for a day or two. The sailing grounds are very easy and the captain can get you to a reasonable comfort level quickly. If you're new to sailing, go with an experienced couple and learn from them. The costs are less and you'll learn a lot.
We can all describe versions of the process, but it will vary significantly depending on the market segment you're playing in as well as what you bring to the party.
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Old 11-05-2012, 08:35   #29
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Re: The buying process. Talk me through it.

Boat Buying Process.

1) Decide which boat you want. This takes months. Read reviews check them out on www.yachtworld.com. Talk to family and ask what kind of boat they think they would like and how they think a boat will fit into their life. Have to get buy in now or you may be on your own.

2) Do you have cash. If not can you get financing?

3) OK, now where can you keep this boat. Call around to get pricing for a dock or mooring. Now go to those marinas on a weekend and walk the docks to see how friendly they are and there facilities. Is it worth the money? Can you see yourselves coming here every weekend.

4) Now start getting on a few of the boats you like. Both you and your partner should go on the boats together to get the different perspectives. Go on the Cruisers Forum or another blog and ask if there is anyone in your area that has one of these boats and see if they will show you and tell you all about their boat. Most boat owners are very happy to show you around. This has work for us well in our past boat purchases. This is a better way to start than asking a broker for a boat tour. It is customary to leave a bottle of wine with them before you leave. This works two fold, if you end up buying a boat just like it then you have a local person to call with questions.

5) Now you know what boat you want. You know from step 1 about what those boats are going for. Find a buyers broker from the marina you will be staying at or locally. He or she will act on your behalf and the sellers will be paying for it. You know from step 1 what sellers are asking, but a buyers broker will tell you the real number that is very important to your purchase and that is what they have been selling for. You’re only guessing without these recently sold prices.
View the boats you like with your broker.

6) Review all your selections and “Pick Your Boat”. Do a pros & cons list of why this boat is the one. This step helps you and your partner see on paper each other’s likes and dislikes.
Any unanswered questions at this point should warrant some phone calls to clear them up.

7) Check with your bank on the boat financing options and get pre qualified for over what price you want to offer.

8) Check with your favorite marina for slip or mooring availability. Ask if they need a refundable deposit to hold it for you. Go to that slip and see if it will work for you pulling your boat in and out. Will you need steps to get onboard? Ask slip neighbors if there are any issues pulling in or out and how good the power is.

9) Decide how you would get this boat from the owners marina to your marina. Do it yourself?
Hire an experienced friend? Hire a captain?

10) Sit down with your broker pull the trigger on the boat you want. This should start by talking about which boat you like and what you would like to offer on it. Your broker will look at your boats numbers again and the current market conditions and recommend a number to offer. Go back and forth until you both agree on the offer. You give the broker a deposit check before you leave.

11) Your buyers broker now calls the selling broker who then calls the seller with your offer.
The selling broker comes back to your broker with a number. You accept or reject the price.
If you like the price, you sign the papers and the seller signs the papers and its official.
If you walk away at this point you get your deposit back.

12) Sit with you bank loan officer and sign all that paperwork. Your broker and the bank may work all the details to the end.

13) Your broker will most likely recommend a marine boat surveyor. If not then go on the Cruisers Forum or another blog and ask if there is anyone in the boats current area that can recommend someone they used and why they used them. Word of mouth works well for picking a marine boat surveyor that is very good. This is one of your biggest investments, so do your homework on this. You will want to ask the surveyor if you can be there at the survey. If the surveyor says no, find another surveyor. Surveyors are very knowledgeable on boat problems and which ones on your particular boat to look for. Here is your first chance to see what your new boat can do and what its potential problems may be. This is a must do, so plan on being there for the full survey. A typical boat survey is done in the water and on a travel lift to check underneath.
Surveys are usually charged by the foot and run +$500 and up. If you walk away from this boat you will not get this money back.

14) Survey has been completed. Within a week your surveyor will give you a typed up Surveyor Report of the ins and outs of the boat. Any issues will be listed with recommendations to resolve.
You broker and bank will review this document closely to see if anything stands out to not close a deal on the boat. If all is agreed on between buyer, seller, bank and broker then the sale goes through.
If you cannot come to and agreement and walk away you lose the cost of the survey and maybe your deposit (most every case you get your deposit back).

15) If all went well you are the proud owner of a boat.

16) Get it registered, pay any state tax, if it is over 35 feet and you will travel far with it you will want to get it US Coast Guard Documented (can do yourself for under $100)

17) Bring boat from Sellers boat slip to your marina slip.

18) Have a drink as the sun sets, Priceless
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Old 11-05-2012, 08:57   #30
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Re: The buying process. Talk me through it.

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16) Get it registered, pay any state tax, if it is over 35 feet and you will travel far with it you will want to get it US Coast Guard Documented (can do yourself for under $100)
Very good and well detailed answer. Now, what entity in particular is the boat registered with? What does the Coast Guard Documentation actually do? What is involved with it and why is it good?

Again, thanks for the suggestions of other forums and such. Never thought of this and will actually do so.

Thanks again
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