Buying my first boat, am I going to get scammed?

[SunDevil]

So I found a boat to buy that needs some interior and motor work, but the price is right…. It just happens to be a day’s drive away from me in North Carolina.

I am planning to check it out in person on Thursday. Or to see if it even exists…

Now it had been damaged, possibly in the hurricane/high winds last September when it hit a pillar, but it looks like it has been repaired from the pictures. I don’t know much about the history of the boat other than that.

My slight concern is that the “owner” or guy who runs the salvage company lives in Key West and won’t be there to transfer the Coast Guard paperwork in person. Is it allowed to email the signed paperwork after the money is sent via PayPal? Do you need the actual paper to notarize it by getting it by mail? Is there some other way that I should be trying to do this or is this a common way to sell a boat? Does the boat yard have any interest in helping usually? Like confirming who is paying the $350 monthly yard fees is the person who I am sending the money to? Will the boat yard have an issue with a random buyer looking around for a boat on their yard and taking pictures of it? It is a fairly big boat yard and there seems to be a main building that I would guess there are some people working at to ask.

Is there anything that I don’t know to ask that I should be asking?

Thanks

[SunDevil]

I also am wondering if fake paperwork is a thing? Although it is enough money, it might not be worth enough to try and scam someone into buying a boat they don’t own… This isn’t a six digit boat or anything.

Or if there is a difference in using a salvaged boat in terms of coast guard approval for putting it back on the water, or if they have to inspect it and approve it before it splashes?

[Fore and Aft]

Sun Devil I would be wanting to see some detailed pictures of the repair being done and some receipts for the work and materials used.
I walked past a boat yesterday that was being repaired, and it was definitely a substandard job. The words bogged and flogged popped straight in my mind.
I am not sure I would be paying for anything without meeting the owner and seeing some legitimate identification.
Cheers

[SunDevil]

I am hoping to see the repair in person. But I’m also not sure if I could tell a good repair job from a quick and cheap one as long as it doesn’t look obviously bad.

When ‘you’ or a salvage company gets hauled out in the US, do they look at ID’s or documentation on the boats? Would the boat yard have any information on an outside company doing the repair work? I do need to ask him that question if he did the fiberglass repair work himself or if he hired it out.

[jeffandlori]

Three things:

Boat title is very tricky, unlike real estate title it is hard to verify ownership and liens. Personally I would not want to do a deal where the person on the title did not show up with legit ID. If you are inexperienced it might actually be worth finding a broker (even at your cost) to handle the sale paperwork and verify the title. Some brokers will do this for a couple of hundred.

If you don't know enough to asses the repair yourself you need an experienced surveyor. Even then it is very easy to hide bad work under enough glass and bilge paint. They will undoubtably find other things that haven't come up yet. A good surveyor can save you a lot of pain down the road. Just be aware that the quality of surveyors varies a great deal, so this is a case where you want personal references if you can get them.

Expect nothing from the boat yard, and be sure that any charges they have are paid or you will likely be stuck with them. Don't take a recommendation for a surveyor from them either.

Nothing will cost you more money and sorrow than a "cheap" boat, so tread carefully. Your description is full of red flags, especially the idea of paying via Paypal and getting the title by mail. I'll come right out and say walk away rather than than doing that, you will almost certainly get screwed.

[topham]

I recently bought a boat in California. Similar situation, but the seller was in Greece. Coast Guard documentation must be notarized, and seams to have a lot of validation behind it. The seller had to not only sign a bill of sale to me, but he also had to produce the bill of sale he had when he originally bought the boat. It was a challenge for the seller to find a notary public in a foreign country. In the end, the document office gave him a way to notarize over a Zoom session.

I used a yacht broker who took care of most of the paperwork, survey's, haul-out, etc. At first, I felt like I might get taken for a ride, and pay more than if I bought direct, but the broker I used was very good. They walked me through every step from beginning to end and actually helped me make the right decision. I paid around $1k for the survey's and it was worth every penny. And, I got a great deal on the sale.

In the end, it took longer, but I'm glad I went through the survey process so I know exactly what might be wrong with the boat. I'm not sure there's a way to fake Coast Guard documentation. Especially if you get a documentation office to take care of it. I would search for "Maritime Documentation Services" in your area and see if they can validate it for you.

[SunDevil]

So are you saying that the seller will need to be at a notary office or watercraft office to notarize the sale before I send the money and then hope that the paperwork gets sent in the mail? And probably a copy via email? In a perfect world I would get a broker, but it might be too cheap of a boat deal for them.

I will have to see the boat physically exists, and that is a very good suggestion to find out if the yard fees are paid up.

I will be getting a survey, it might be after I own the boat though. I don’t foresee any reason why the boat itself would fail, although I can understand that there are going to be problems. It is almost a 40 year old boat.

I can also say that this isn’t going to financially ruin me if it is a scam, It won’t be good losing thousands of dollars, but after the last few months in the stock market, I have been losing or gaining this much frequently…

There are a lot of red flags, but there are a lot of green flags too. Maybe I am too trusting, and not willing to call him a scammer yet. Maybe I am just willing to gamble with this situation since I don’t gamble in a casino in real life. I just figure that if I were the seller a few hundred miles away, I would be in the same situation of having to prove I was going to send the documents after getting paid.

[JPA Cate]

I will be getting a survey, it might be after I own the boat though. I don’t foresee any reason why the boat itself would fail, although I can understand that there are going to be problems. It is almost a 40 year old boat

I actually cannot believe you really mean this, but maybe you didn't take in what Fore And Aft wrote, "Bogged and flogged", which is a short hand way of saying "patched and dispatched" or "filled holes and sold." It implies a repair that was covered up and not fixed, like the old expression about buying a can of paint, which referred to a poor used car, only painted to sell, maybe with a brush and not sprayed..

If you really are interested in saving yourself some woe, for heaven's sake get a a survey before purchase. Also, boats are always depreciating assets. They cost a lot to just keep up. Make NO assumptions about being fit for purpose.

If the above statement in bold is a true reflection of where you're at, yes, you will attract scammers.

Sorry to be so blunt,

Ann

[topham]

Originally Posted by SunDevil

So are you saying that the seller will need to be at a notary office or watercraft office to notarize the sale before I send the money and then hope that the paperwork gets sent in the mail? And probably a copy via email? In a perfect world I would get a broker, but it might be too cheap of a boat deal for them.

I will have to see the boat physically exists, and that is a very good suggestion to find out if the yard fees are paid up.

I will be getting a survey, it might be after I own the boat though. I don’t foresee any reason why the boat itself would fail, although I can understand that there are going to be problems. It is almost a 40 year old boat.

I can also say that this isn’t going to financially ruin me if it is a scam, It won’t be good losing thousands of dollars, but after the last few months in the stock market, I have been losing or gaining this much frequently…

There are a lot of red flags, but there are a lot of green flags too. Maybe I am too trusting, and not willing to call him a scammer yet. Maybe I am just willing to gamble with this situation since I don’t gamble in a casino in real life. I just figure that if I were the seller a few hundred miles away, I would be in the same situation of having to prove I was going to send the documents after getting paid.

That's what they told me. In my area, we used a company called Dona Jenkins. They contacted the seller to get the necessary paperwork done and gave the seller an option to work with a remote notary. He presented a passport over a zoom session.

[letsgetsailing3]

Have a surveyor meet you at the boat.

Will there be someone there to allow you access to the interior? Clearly you want to see that before purchase.

I wonder if a local broker or lawyer would (for a fee) manage the purchase for you? That might help reduce your concern over the transfer.

[CarlF]

This is just two risky to “do it yourself”. You need to spend some money on help.

1) Hire a lawyer. If the seller was using a licensed broker this might not be necessary. The broker would answer all your questions. They will also hold your payment in escrow until the title has been properly transferred. If the seller refuses to use a broker then you’ll need a lawyer to do these things

2) Hire a documentation agent. They will make sure the paperwork with the CG is done properly. They will also check the title for liens from the boatyard, people who have done work on the boat and weren’t paid, or others. Do not take ownership until all liens have been removed.

3) Hire a surveyor. He will look at the repair and likely find other issues. He will give you an approximate value of the boat and the cost of any repairs. Do not trust that repairs will get finished. Buy the boat as it is today and subtract the cost of finishing the repairs from your offer.

4) Find an insurance company that will agree to insure the boat. Most boatyards and marinas require proof of at least liability insurance for dockage. Usually $500k to $1M. The insurance company will likely want to review the survey.

5) Talk to the boatyard (both the manager and other boaters) You want to know as much history of the boat as you can. Boats like this often have a “story” that is well known. You also need to know about any unpaid bills that will become your problem the moment you own it.

[ranger58sb]

Originally Posted by SunDevil

I will be getting a survey, it might be after I own the boat though. I don’t foresee any reason why the boat itself would fail, although I can understand that there are going to be problems. It is almost a 40 year old boat.

Even a new (or newer) boat can fail a survey... in a heartbeat.

You would likely need a survey for insurance purposes anyway, but the main reason for surveys is to stop you from buying a piece of crap with boatloads of not-so-visible (especially to a novice) problems.

There are two kinds of survey, marine (the boat, hull, etc.) and mechanical (engines and genset). Either or both can wave you off a money pit... both can at least give you better insight into what's broke now, what's on the verge of breaking, what's not up to code, what's been "repaired" with bubblegum and duct tape... so you can get a better feel for how much real repairs will cost you... relative to a potential purchase price that you might be able to negotiate based on survey info.

-Chris

[boatpoker]

Read this before you go look at the boat, It will give you an idea of what to look for ... Marine Survey 101, pre-survey inspection

[Reeve21]

I'm sure the price is attractive, but you are looking at a damaged boat with a questionable history. Are you are in over your head trying to do this deal yourself as your first boat purchase? I've bought and sold many times with and without brokers and would not touch this one with a 10 foot pole

[GoAway]

I agree with those who said you should not consider buying this boat.

I guarantee you that you are underestimating the time (if you are doing work yourself) and expense either way by a significant margin (probably at least by double) what it will take to get the boat in good shape. You just don't have the experience to accurately assess this. It may seem cheap buying this boat, but it will probably end up costing you more than a boat that is in good shape.