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Old 09-04-2013, 03:06   #1
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Buying without a Broker?

We are not new to owning a boat, but the purchase of a 46' floating home with sails is different than an 18' beach cat. We are in the process of winding down life on land and gearing up for life aboard. Aside from small details (selling the house and contents) we are on track for this to happen any time after 5 July when I finish teaching my last class after 30 years as a college professor. I have read more articles than I should have up; many on how we would be crazy not to use a broker when buying a boat but here's the deal, we have found a boat (maybe THE boat) and the owner is ready to sell and does not want to use a broker. No question we would get a survey done for insurance and our own piece of mind but what are the other things we need to consider? Like a house, is there title insurance? What about a title search? The boat was salvaged and rebuilt/repaired and upgraded, is it possible there are past owners and creditors with a claim on her? I guess the biggest question is how do I protect myself legally and not end up loosing my new home? Forms, there's got to be a bunch of forms right! What am I forgetting to ask? No wonder I am wide awake at 0300hrs.

Thanks in advance-

Fred
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Old 09-04-2013, 05:43   #2
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Re: Buying without a Broker?

This advice comes from my short stint as a yacht broker and experience buying and selling a dozen of my own boats over the years:

Go to the Boat US web site. They have several services for buyers in your situation: contract, escrow service, etc.

Title insurance is rarely used in the yacht industry. The main reason I believe is that there are so many exclusions, you don't get any more protection than getting a USCG abstract yourself and checking for liens in the state that it resides. Documentation services like Atlantic Boat Documentation can do that. You might also check with the yard that the boat is in to make sure all of their bills have been paid.

Boats are different from almost anything else. A yard or mechanic has an automatic lien on the boat for any unpaid work. He doesn't have to file to perfect it. That is why you must check with the yard.

David
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Old 09-04-2013, 06:51   #3
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Re: Buying without a Broker?

David nailed it...
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Old 09-04-2013, 07:36   #4
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Re: Buying without a Broker?

I'm going to caution that someone who buys a salvage boat and then on the other end is too cost conscious to use a broker is potentially not the sort of person that you want to buy a boat from as it indicates the that expense may have been spared in the refit. It might not be the boat you want as a result.

The ideal scenario is to find a well kept and recently refit boat that has been lavished with attention from a knowledgeable owner of means.

Obviously there are plenty of knowledgeable boat owners who are exceptions to the rule and have done great refits and are simply value-conscious, but I would be very careful to confirm that's the sort of person I was buying from.

In my experience handling the paper work is just the tip of the iceberg of the value of a good knowledgeable broker. They know the market in terms of value and condition and whether you can do better than the boat you're looking at. They also, if you pick the right one, have insight into what boats best fit your needs in ways that you may not have anticipated.
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Old 09-04-2013, 08:18   #5
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Re: Buying without a Broker?

Quote:
Originally Posted by Suijin View Post

In my experience handling the paper work is just the tip of the iceberg of the value of a good knowledgeable broker. They know the market in terms of value and condition and whether you can do better than the boat you're looking at. They also, if you pick the right one, have insight into what boats best fit your needs in ways that you may not have anticipated.
Wow. I'm glad some brokers do something for their 10% commission.

I've looked at some boats with sales guys who thought they were doing me a favor by unlocking the overpriced money pit they were showing me, after I coaxed them out of their office.

I haven't seen any that told me "you can do better than this project boat I'm currently showing you".
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Old 09-04-2013, 08:21   #6
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Re: Buying without a Broker?

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Originally Posted by fbchristo View Post
...owner is ready to sell and does not want to use a broker.
That is the best reason I can think of to use a broker! Simply agree that the broker's commission will be paid by you.
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Old 09-04-2013, 08:22   #7
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Re: Buying without a Broker?

Maybe a buyers broker?? That might be the ticket for ya !! Just a thought
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Old 09-04-2013, 08:27   #8
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Re: Buying without a Broker?

10% commission seems like a lot to pay someone for filling out the paperwork for a boat sale.
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Old 09-04-2013, 09:31   #9
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Re: Buying without a Broker?

Do your own research and save the 10%. Also don't count on the surveyor finding everything do your own beforehand. Example surveyor "can't see chain plates without disassembly" if what he meant is opening the breaker panel and looking is disassembly. Use your own eyes plus friends plus surveyors. Then you will miss less of the problems but still not all lol.
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Old 09-04-2013, 09:59   #10
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Re: Buying without a Broker?

Find a good surveyor and spend a day or two with him on the boat. You'll learn a lot. Then you can make a decision as to whether or not you feel you need any additional help. Good luck.

We had two boats over the course of 16 years before we spent a year looking for and finding "the one." We surveyed one just like it a week earlier and it simply didn't pass muster - too many small things wrong. A week later we found this one, in pristine condition.

This newer boat was substantially bigger than our older smaller outboard powered boats, with more complicated systems. I did a LOT of research on the boat and the systems, and spent a day with the surveyor. Everything worked.

There are god surveyors out there, and you have to spend some time finding them, too, in addition to the boat.
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Old 09-04-2013, 10:53   #11
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Re: Buying without a Broker?

Thanks for the information and opinions and please keep them coming. The person who is selling the boat has done most of the repairs and upgrades and has experience in both but I would depend on a surveyor(s) to confirm the work is as good as it looks. dmarchand you mentioned liens from a boat yard. To my knowledge the current owner purchased the boat from a yard when the owners could not pay the salvage bill (dragging anchor vs. low bridge) and he has done the work at the dock at his home, but if there were outside trades working on her is there anyway to know that if the owner fails to disclose it?
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Old 09-04-2013, 11:30   #12
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Re: Buying without a Broker?

Find out why the owner does not want a broker and take it from there.

Before you have the boat surveyed, sign a contract - which protects you on the deal. If you don't have these forms, PM me and send it to you.
Once its signed by both parties, do the survey. The contract is the only thing tying you to the deal. This is the same thing you sign when you hire a broker. The seller is paying the broker to find you and fill out the paper work. Nothing against brokers, but in my opinion they are not absolutely necessary - but a survey is.
Good luck with the purchase.
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Old 09-04-2013, 11:39   #13
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Re: Buying without a Broker?

I would avoid brokers like the plague. Never had a good experience, can relate MANY bad ones, they have only their own interest at heart.
They add nothing to the deal.
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Old 09-04-2013, 11:57   #14
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Re: Buying without a Broker?

Not a fan of most brokers either. With the internet advertising is cheap or free. The added 10% would be better served by dropping the price and moving the boat. If a boat is priced right it will move fast with little effort.
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Old 09-04-2013, 12:07   #15
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Re: Buying without a Broker?

A good yacht broker does way more than just fill in paperwork... If it was that easy don't you think there'd be a lot less captains and a lot more yacht brokers?
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