Pay Before You Even Get a Survey

[Mate]

I have had some dealings with US brokers now and find it hard to appreciate that they want a 15% deposit with your offer to purchase .
Bluddy hell , why cant they just offer the price and the seller can say yes or no . Then take it further .
A foreign buyer like myself , cant just jump and fly over there always to make an initial inspection , before any offers .
I have to exchange from AU to US then probably back because they wont accept my offer . NO THANKYOU.
You cant even get and pay for a suvey before the deposit . What a load of horse dung.
I guess you just gotto follow the rules , even if they are there to make the rich richer and the poor to keep on dreaming.

[NotQuiteLost]

That sounds like a load of crap. I don't know that I'd work with them if they did that...maybe that means I'd have a hard time buying a boat nowadays?

[TaoJones]

This is the first I've read about brokers / agents demanding a 15% deposit up-front. I suspect it's an opportunist trying to take advantage of an unsuspecting foreigner. Don't pay it.

I suggest, instead, that you ignore the broker / agent who has the listing - regard him as a self-interested liar. He may not be, but the point is he isn't your friend and he doesn't have your best interests uppermost.

Instead, if you can't get to and deal directly with the owner, hire a buyer's broker - someone who will be much more likely to look after your best interest. Tell him, before you hire him, that you're no fool and that you will not even consider putting up an earnest-money deposit in excess of 10% and that you expect your proven-good-funds instrument to be held until there is a signed contract returned by the seller accepting your offer, which you must state in your contract offer is subject to an acceptable survey. Insist, as well, that if your offer is accepted that your instrument be deposited directly into escrow, not the listing broker's account.

A broker representing you alone will have much more clout in the negotiations, and, if you've been careful and selected a competent one, will not be snowed by another broker / agent. You absolutely must have your own representative f you're trying to do this long-distance.

And, if it helps you be more comfortable, you can probably find an expatriate Aussie with strong cred already working here in the US. You might also consider contacting Forum member MarkJ - if what you're trying to do is buy a vessel in S. Florida or the Caribbean and sail it back to Oz, he's already done it and can give you lots of pointers, I'm sure.

And, finally, if you cannot make even a cursory inspection yourself because it's impractical to fly half-way 'round the planet to do so, consider reaching out to a trusted member on this Forum who is already close to the vessel you'd like a first-hand report on. Most love looking at boats anyway, and many will be happy to do it gratis.

Good luck in your search.

TaoJones

[s/v Beth]

Good'ay Mate.
In addition to spending a few years in Auz, I hang around the marinas in Washington and Utah a fair amount. If you have a boat you want me to look at, I would be happy to.

[Mate]

please email full name address phone# and fax if you have available. i will email completed offer form please send back by email or fax and mail check for deposit also email or fax copy of check as i have to have at lease the appearance of a deposit to make an offer,. if we come to terms your 10% deposit is deposited in a bonded trust account. in contract it will say subject to visual inspection sea trial and survey. no one in california can keep any of your money until all subjects to have been met and you sign final acceptance, the offer form is very specific about your rights

Maybe not as bad as I make out , this is CA law .Apparantly
Wish the broker could spell and take a bit of care with emails .
saying that , this guy has been pretty good and as informative as he probably can .

[Johnathon123]

Hi Mate,

Interested in your plans,

I have crunched the numbers a few times on buying a US yacht and getting it to AUS. I can't make the numbers work with freight, gst, duty (if applicable). Can't get the wife to sail home although that doesn't help much.

Do you have a trick because I find the range of US boats much more my cup of tea.

[roverhi]

To make an offer, you need an earnest money deposit. Typically it is a check that is held by the broker. It's up to the broker if he keeps it uncashed or deposits into his client trust account. Without the deposit, there are thousands of ******** who will make an offer with out any intention of completing the transaction. These slimey creatures get their jollies needlessly getting the seller's hopes up and making the brokers work for nothing. It's a pain if you have to take the loss of converting currency but it should be a one time expense that will hopefully be part of the cost of buying a boat. You can roll the deposit into the next offer until you get a successful deal.

!5% is a bit steep if we are talking a six figure boat. You might try and negotiate the amount of the earnest money deposit as it's not set in stone.

I'm not a boat broker but spent years as a real estate broker. A contract is not a binding contract without earnest money.

[Palarran]

Originally Posted by roverhi

To make an offer, you need an earnest money deposit.

No doubt. Typically the deposit isn't given to the seller broker but to your (buyer) broker. If they are one in the same, then so be it. If your serious, put your money where your mouth is. Otherwise, the seller is going to be taking his boat off the market all the time for no reason. The process of just getting a survey can take a month.

[fishwife]

I've had a little experience of looking at boats in the USA. When it was suggested to me that I put up 'earnest' money, I replied saying that my instructing and paying for a surveyor was plenty of earnest intent. If they wanted to do a deal, it was on my terms, my money being spent, not theirs. It worked for me.

P.

[Mate]

Now fishwife , That makes sence . Who would want to pay for a survey , that wasnt really interested .

James , my only trick is to sail it home myself , saving 50 or more K on the boats Im looking at .
At the end of the day , it will come close , but still slightly better than purchasing here in Aus , and i will have a life long experince as well . I dont think I will loose if I sell straight away, but this is not my intention.
Sorry no tricks , Im learning the hard way.

[SailFastTri]

Don't count on the law to protect you. If you need to resort to that it could take years and the legal process is expensive. Even if you win it can be difficult to collect your judgment. Only the lawyers win in court.

[Tellie]

Originally Posted by fishwife

I've had a little experience of looking at boats in the USA. When it was suggested to me that I put up 'earnest' money, I replied saying that my instructing and paying for a surveyor was plenty of earnest intent. If they wanted to do a deal, it was on my terms, my money being spent, not theirs. It worked for me.

P.

I agree. Whiskey Tango Foxtrot. Here in S. Florida we have some really good brokers and some really shady ones. I'm sorry the owner gets his hopes up and let down by a few jerks. Many if those jerks are the brokers themselves. How many buyers get their hopes up when a boat advertised turns out to be a friggin piece of crap after you've traveled to see it on the good advice of a broker or seller. Ever get any up front money for that experience? You also won't see a broker put up a dime when they promise the world to a seller and get his hopes up just to let him down after six months of listing his boat. Some of these yahoos are in the business of listing and keeping boats at the dock for as long as they can to collect a percentage of the associated fees. Ask any real estate person what MLS stands for (More Lazy Sales people) many boat brokers are cut from the same cloth. Not interested at all in their cry baby show. Not your problem to solve with what can easily amount to tens of thousands of your dollars at 10%. Believe me these brokers will bend, especially in this economy. Tell the seller or broker you have a reputable surveyor standing by ready and willing to see the boat. Give the buyer/broker his number to verify if they want. For a few hundred dollars hire an attorney to hold a deposit of your choosing in his escrow account. I would never give that amount of money to a boat broker. They are not held to the same standards as real estate brokers and I wouldn't give them that kind of money either. If you give someone 20-40+K They are going to be in the drivers seat and many will not hesitate to make you jump through hoops to satisfy the seller, the broker and all the little annoying people that come out of the wood work when the sale is near it's completion. I don't care what anyone in that business tells you, everything is negotiable, even earnest monies. If the broker doesn't like it say adios, there are dozens more waiting in line behind them. I know a lot of folks will disagree with me that's fine. But the majority of my customers are recent new to them boat buyers or people ready to sell. Many are still smarting after their buying/selling experience.
OK rant over.

[daddle]

Originally Posted by fishwife

I've had a little experience of looking at boats in the USA. When it was suggested to me that I put up 'earnest' money, I replied saying that my instructing and paying for a surveyor

Yup, it's a negotiation, You can take it, leave it, or propose something else. A reasonable thing to do is post the deposit to cover the haul and survey ... probably less than 10% ... This is handy if it's a cross-border sale as the selling broker can handle the pain of paying the yard and surveyor ... which you hire. They of course refund the balance if the deal falls thru. Make sure it's written down. 99% of brokers are basically honest...well...not totally dishonest ... make sure .. with a document and a personal conversation that the money is NOT going to be in the hands of the seller.

[Mimsy]

Forum communities are invaluable when it comes to getting another set of eyes on the boat. I think you just need to keep in mond that a fellow sailor who is doing a walk through for you is doing it as a favor. Don't expect them to catch everything, even paid surveyors make mistakes.

I've looked at a boat for someone I have never "met before. I took lots of photos, only stated what I absolutely saw and gave no opinions on what might or might not be going on with any system. It worked out well because the person I was doing the scouting for had realistic expectations of my contribution.

I think if you find something you are interestd in, turning to a forum member who is local to it is a great way to not have to pony up and earnest money before you are really sure you are interested. Fellow sailors will get very different photos than the brokers of the same boat!

[aquamarine]

Originally Posted by Mate

I have had some dealings with US brokers now and find it hard to appreciate that they want a 15% deposit with your offer to purchase .
Bluddy hell , why cant they just offer the price and the seller can say yes or no . Then take it further .
A foreign buyer like myself , cant just jump and fly over there always to make an initial inspection , before any offers .
I have to exchange from AU to US then probably back because they wont accept my offer . NO THANKYOU.
You cant even get and pay for a suvey before the deposit . What a load of horse dung.
I guess you just gotto follow the rules , even if they are there to make the rich richer and the poor to keep on dreaming.

Hi Mate,

I bought two yachts, one in Florida and one in Europe being myself based in south East Asia. In both cases I have dealt directly with the selling Broker, the way I proceed was as follows:
1) Got as much info as possible through the broker and through the net
2) Made a price proposal and negotiated the price until agreement from both parties
3) Signed a pre-purchase agreement conditioned to visual inspection, sea trial and survey and made a 10% deposit on escrow account
4) Went to inspect the yacht and stayed there during the full survey
5) had a new price negotiation based on survey report and general impression after inspection. Once the price was agreed, signed an acceptance of the yachts and made the remaining payment upon closing of the sale.

Few recommendations:
1) I had to deal with two brokerage firms, one rather small and one very well known and in both cases the brokers have been extremely helpful and honest
you can assess this easily in the way they behave during the first phase of negotiation while you have not yet made any deposit...
2) Select a good surveyor
3) For closing, select a good documentation company
4) No matter what brokers will tell you, it is still a buyer's market right now so don't hesitate to negotiate, if you don't get what you are happy with (being reasonable). just move to another yacht, there are plenty on the market.

Enjoy your purchase