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Old 23-04-2014, 17:23   #1
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Two Questions: One Regading the Deposit, One on who Owns Survey Report

Seller is asking for 20% deposit. That's fine with me, though as I understand it, the deposit is usually 10%. I am pretty sure the boat is in fine condition, however, should a surprise occur is it standard practice that if I choose not to buy the boat that I lose the money? I do not have a broker. The contract states that I pay the 20% within five days of "Execution" of contract, which I think means when I sign. And the money is to be wired into seller's bank account with no mention of what happens to it should I take a hike on the deal. Problem?

Secondly, the Contract states: "The buyer agrees to email a copy of the Survey to the Seller within five days of the completion of the survey."
Seems to me from what I've read on this forum that the survey is mine to do with as I please. This is a question of lesser concern than my first question, but...It Just Don't Seem Right! I would imagine it is easily crossed out of the contract by me, and then I sign and send the contract back, right?

As you have probably already guessed, I'm new to this. Your help is most appreciated!

Thank you,
Ty
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Old 23-04-2014, 17:28   #2
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Re: Two questions: one regading the deposit, one on who owns survey report

It is my understanding that the survey is for your information, not the sellers. You pay for it, you own it.
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Old 23-04-2014, 17:38   #3
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Re: Two questions: one regading the deposit, one on who owns survey report

I would not agree to those conditions. You can not be sure the boat is ok until the survey is done. You are making the offer so you write the contract not the seller. I would not put the down payment in anythng but a third party escrow account. The contract should have conditions underwhich you can back out. You should only have to put down earnest money to get your survey done and that should be a whole lot less than 10%, usually more in the neighborhood of 1%. If you let the seller put 20% in his personal account and it fails the survey, odds are you'll never see it again.
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Old 23-04-2014, 17:55   #4
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

Run!!!

Don't pay a deposit to the seller, it MUST go into escrow with a third party.

Ensure that the "written offer", not "contract" stipulates that the sale is subject to "inspection and survey" and that the deposit will be returned if the inspection or survey is not acceptable to you. You are making the offer, you set the terms.

You are paying for a survey to be done for you. It is yours. If you want to show it to the seller to show defects, you may do so but he has no right to a copy unless he reimburses you for the cost.

20% is excessive.
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Old 23-04-2014, 17:56   #5
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

If he wins 20% off of five people he has a free boat. Great idea really. In all sincerity, I would give him nothing, he sounds dubious, The survey is yours and yours alone, unless he wants to pay for it.

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Old 23-04-2014, 18:03   #6
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

Now you can SELL the survey to the owner, but its YOURS.

Agree w/ Capt. Bill. though. I'd walk away.
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Old 23-04-2014, 18:05   #7
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Re: Two questions: one regading the deposit, one on who owns survey report

Never heard of a seller having the gall to demand a copy of a prospective purchaser's survey.

Have had some ridiculous contracts sent to me though. I walk away when that happens.
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Old 23-04-2014, 18:12   #8
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

It sounds like the OP is stating that the seller is engaging the surveyor. Buyer should select (carefully) the surveyor, pay and own the survey. Run don't walk
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Old 23-04-2014, 18:23   #9
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

I've been a broker for far too long. DO NOT SEND HIM ONE PENNY! use an escrow account, find a local marine documentation center and they will do everything. What state are you in?? If you pay for the survey you can opt to send him a copy but I wouldn't until it closes. If you back out he just made 750 bucks on you by selling it to the next guy. This guy sounds like a jerk if it was me I would move on, I don't like being told what to do. You have the money, there are 100.000 boats for every buyer out there ok I'm just saying Good luck to you.
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Old 23-04-2014, 18:40   #10
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

Stu M and Capt Bill are correct. Under no circumstances should you pay the current owner anything to have the 'honor' of doing a survey!. Set up an escrow account with a title company or independent attorney who will handle the doc executions. Best to find a reputable marine documentation company which you will need because if you are asking these questions, you will need some expert handholding through the process.
Were you using a broker, his commission would be 10% (this is negotiable!) so that might be a convenient figure to settle on although I think it is a little high. Why is the current owner asking for a deposit before the survey in the first place? You are paying for the survey and you own it and do not have to share it with anyone. Frankly, that would be a stipulation that would queer the deal for me right there!
Something smells fishy in this deal and you may want to walk... tell the seller the reason why if you want to. He may not know what is reasonable and customary in boat deals.
Boats I've bought in the past were ones that I was certain that I wanted to buy so have put up to 50% of the offer price after I had satisfied myself it was in good nick and would survey well. Mind you I grew up on boats so know what to look for. I always felt another set of eyes would find stuff I missed or found and wanted a closer look by a licensed surveyor who I knew and trusted.
Once your personal survey was complete and if you choose to have a licensed surveyor perform his/her duties then adjust the offer price accordingly or have him perform the necessary work to have the vessel lifted up to the standard that is acceptable for the price you are willing to pay. You will responsible for the attendant costs of the survey, both hull and mechanical as well as rigging and pulling and splashing the boat. Try and get the survey results while the boat is out of the water so if you do close the deal, you can get a load of bottom paint and zincs done without having to pull her again. Lay days in the yard should be pretty reasonable, particularly if they are getting a bottom job. Good luck... Phil
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Old 23-04-2014, 18:47   #11
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

Wow-wee! Thank you all very much! I am starting to have my doubts on this transaction as well. There are more little goings-on that I won't bore you with, but you all made great points. One thing though, I would pick my own surveyor, not his. I've at least learned that much from this forum in the years I've been here.

Thanks again,
Ty
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Old 23-04-2014, 19:45   #12
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

This contract template comes from the Royal Yachting Association so relates to the UK.
Even so it may give an idea of what is considered reasonable for buyer and seller.

http://www.rya.org.uk/sitecollection...0AGREEMENT.pdf
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Old 23-04-2014, 20:10   #13
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

Hello again, Ty... i forgot to mention in my previous post to have an oil analysis done by whoever is doing your mechanical survey. I it is helpful if they are dealers or manufacturers reps for the engine aboard. CAT mechanic for CAT engines, Yanmar mech for Yanny's, etc. Make sure the engine is run up to opt'g temp before you snatch a sample. Mechanic should also accompany you on sea trial as well as rigging surveyor if it is sail. again... good luck if you move forward with the deal... Phil
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Old 23-04-2014, 20:20   #14
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

1. tell the seller you won't give him any deposit. none.

2. tell the seller you will pay for a haulout and survey. that is 'usual and customary'. unless the boat is already hauled out, of course.

3. find a good surveyor. DO NOT use any surveyor the seller recommends.

4. you will have to pay for the surveyor too. the survey belongs to you. you
can show it to the seller if you want him to know what problems your are concerned with and why you are reducing your offer - or even rejecting the boat.

5. what also concerns me is the paperwork on the boat. i notice you're in panama.
is it a US registered boat? if it's panamanian you may need to enlist the services of an attorney or boat broker to make sure the owner actually owns the boat free and clear and has the correct ownership papers. and you will need to execute a bill of sale that is acceptable in panama as well as getting registration there.

6. this is getting complicated....
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Old 23-04-2014, 21:31   #15
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Re: Two Questions: One Regading the Deposit, One on who Owns Survey Report

It is a US flag shipped boat.

As per advice, I am looking into Panamanian Maritime Marine Documentation Companies, and find that I am having trouble getting a good Google answer regarding a Panamanian Maritime Marine Documentation Company. I am also discovering the difficulty in just saying "Panamanian maritime marine documentation company", but that's for another thread.

Thank you all, again!

Ty
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