US Practice of Deposit with Boat Purchase

[DeepBlueSea]

agree, I had a bad vibe about this broker from the start of this loop...plenty of good brokers out there, be patient and shrewed, and good luck.

[MarkSF]

I've sold a number of cars in the last couple of years, including my beloved Jaguar XJS Convertible.

It is clear that there are two kinds of buyers :

The one who looks around for a really nice, well-cared for example, and having found it is anticipating paying somewhere around market rate. He's a pleasure to deal with as he's done his homework, checked the VIN, and having confirmed that the car is indeed as stated in the ad, negotiations on price are straightforward.

Secondly, those who go around low-balling a number of owners in the hope of getting a bargain.

I know which kind of owner is likely to have a more satisfying long-term experience with their purchase, as in two years time it won't be the fact that you saved a grand on the purchase price that puts a grin on your face.

[SaltyMonkey]

There is another kind of broker you might want to consider since you are so far away.

A 'buyers' broker is someone who will work with the buyer to find a suitable boat. You basically give them a budget, agree on the kind of boat, and they look in the market place, give you listings and help you craft a proposal offer etc. You can also use them to look at specific boats in an area if you cannot get there to review yourself, instead of having a "drop by" survey done by a surveyor.

When you find one to buy, you basically buy through them acting either as the listing broker or a selling broker for another broker. Thats how they get paid.

Sometimes there isn't such a firm line between these types of brokers, but you might want to reach out for some brokers willing to act in the 'buyers' interests. They do exists and sell themselves as such.

[Doodles]

Salty makes a great point about using a "buyer broker". I've used one the last couple times and enjoy a good relationship with mine. As most here know, I'm toying with the idea of moving to a cat in a couple years. I recently contact my broker and asked him to look at a boat for me. Here is an edited copy of his response ... very professional, competent and more than I expected, which is why I recommend him often. This cost me nothing of course, but when the time come I will gladly make a deposit. Find a professional you trust and let them do what they do best. My guy also deals with international sales so if I want to look at something overseas he has the expertise.

Doodles,

I finally had a chance to get aboard the xxx this afternoon. She could use a hose down on the exterior but as a whole she appears to be a good boat. Much different than the boats we have been on together but definitely worthy of consideration. Like living in a condo.

This is a one owner boat. The owner took delivery in France then sailed her to the Caribbean. Kept her there for a few years then brought her to the Chesapeake. She has never been chartered.

There was some crazing on the cabin sides but it seemed to isolated and should be easy enough to deal with if necessary.

The boat is a bit light on equipment. I didn’t see any a/c units, water maker, etc.

The interior is very clean and comfortable. As with most cats of this vintage the interior is mostly molded fiberglass furniture. The nav. desk is small but the saloon table is adjacent for chart layout. The living quarters are functional but a bit sparse for my taste. Not a ton of storage or hanging lockers although there was a lot of room under the berths and in the bows. There was some veneer damage in the aft starboard cabin but it appeared the repair was underway.

Both engine rooms were clean and well organized. The machinery looked lightly used. There was some corrosion on the fuel tank but it should be easy to clean up.

You may have noticed that the asking price on this boat has increased to $xxx. My sense is the owner has a sizeable note on the boat that he needs to cover. Probably doesn’t have a lot of wiggle room.

Shifting from a mono hull to a cat will take some thought. After you firm up your travel plans I suggest we schedule some time to get aboard a variety of comparable cats including the xxx.

I look forward to seeing you. In the meantime if you have any question on the xxx or if you discover any other boats you would like me to check out please let me know.

With best regards,

the broker

[SaltyMonkey]

Doodles - very impressive letter. More than i ever expected coming from a buyers broker. This broker sure knows his worth and service!

[Doodles]

Salty, yes he's with Martin Bird who you mentioned earlier. This is why hate it when so many rag on brokers. There are some really good ones if you make the effort to find them. Of course, whining is so much easier.

[Mambo]

Originally Posted by Bash

I was once in a situation where a broker wanted 10% earnest money, and I responded that I wasn't willing to make that much money liquid at that point, but that I'd be happy to write a check for $1,000. That was fine with the broker.

They just want to know that you're a serious enough buyer to make a commitment to the deal.

Agree with Bash. I made a half a dozen offers in 2009 and wrote good faith checks with each but I wrote them for the amount I wanted -- not what the seller's broker wanted. In one case I wrote the check for the full amount offered -- in all others 5-20%. Also think about the agreement itself -- it is YOUR offer say what you mean to say. I compiled my own AOS, you might consider doing that or hiring someone to assist you (depending on the price of the vessel obviously)

Luck,
-M

[JRM]

Originally Posted by pablothesailor

Erik,
What a pompous plank.........why deal with someone like him?? Surely his answer should be ¨Dear Eric, thanks for your email, your offer is not quite high enough, however, after talking with the owner they would be prepared to settle on $$$$.....if this is of interest to you please send me a deposit of $$$$ to hold the boat, we can then start to make arrangements for the rest of your purchase,
Kind regads,
Broker¨


PS...I dont believe he has had any offers by the way!! Plus, he is probably 100 years old plus

I think you need a bit of a breather here. Remember, this is business. It's not personal. So many people get wrapped up and offended when a business offer is rejected. Why get all worked up about something like "That guy wants too much for his boat!!!" So what? It's his boat. He decides what it's worth. Don't get all upset because the someone who's selling something thinks it's worth more than the someone who wants to buy it. Maybe he owes that much on it and can't go underwater on the sale. Again, it's nothing personal, it's business.

The 10% requirement isn't personal, it's business. They're not even going to deposit the check. Heck, most of them will accept a faxed copy. You obviously are way too close to the situation, but if you aren't willing to toss down some earnest money then you obviously aren't serious about the purchase.

Or, try this, as I did last year. Was looking at a boat that was priced very reasonably, but was outside my price range at the time. Guy wanted $119k for it. Asked the broker, "think he'll take $80k?" That's not an offer, the broker doesn't have to call the seller and ask, you've merely asked his opinion. Broker says, "no, he rejected one at $85k." OK, so now I know, and I can say "if he gets hungry call me."

Again, it's not personal, it's business. If the seller gets hungry he'll sell. My marina neighbor has his boat for sale. It's priced high, because he really doesn't want to sell it. If someone writes him a full price offer he'll take it, but other than that he's keeping it. It's a nice boat, and there's been a bunch of people looking at it, and several that have really wanted to buy it. One got really upset at the listing broker because the boat was listed so high and the broker was honest in telling him that only full price offers will be considered. How exactly is that the broker's fault?

JRM

-- I'm selling my truck at the moment. Price says "firm." Should be obvious, but I've had couple people get upset on the phone because I won't take less. I don't hate them, but I do think it's silly that they're upset about what I want for my property. They're free not to buy it, and I'm free not to argue with them.

[Cheechako]

The broker is required to put the money in escrow anyway.... and of course the contract always specifies subject to inspection. You could take one look at the boat and reject it and he is required to give you the money back anyway. Yes, I think it is just a token of sincerety really... If given a check in hand most I know would hold it until a final price and terms are met... but not all I suppose!

[DeepBlueSea]

...agree Cheechako, and very well spoken JRM- hits the nail on the head. But living over seas and not knowing who your working/dealing with...what else ya gonna do if the broker simply decides to cash your check and not return your phone calls, take it to the small claims court in the Hague?

[Doodles]

Originally Posted by DeepBlueSea

...agree Cheechako, and very well spoken JRM- hits the nail on the head. But living over seas and not knowing who your working/dealing with...what else ya gonna do if the broker simply decides to cash your check and not return your phone calls, take it to the small claims court in the Hague?

No, you go to Texas or Annapolis or wherever the broker is and file in that court. You would have standing, just like a US citizen. Sure its would be an expensive trip, but why would you expect buying a boat from overseas to be simple and risk free?

[DeepBlueSea]

precisely.

[s/v Jedi]

You guys still don't get it... most people can't write checks because they don't have that obsolete payment method anymore where they come from. Last time I could write a check was in 1985 or so. Even if I could write that check today, a broker in the US would not be able to cash it with their bank, because only European banks would have accepted it.

So, the only option would be to actually wire transfer the money at a cost of around $500. You still think that it's normal to loose $500 *and* the interest on the amount transferred, just to show you are serious? I hope not. Especially not if all you have to show is a photocopy of a check which cost you nothing.

ciao!
Nick.

[Doodles]

Originally Posted by s/v Jedi

You guys still don't get it... most people can't write checks because they don't have that obsolete payment method anymore where they come from. Last time I could write a check was in 1985 or so. Even if I could write that check today, a broker in the US would not be able to cash it with their bank, because only European banks would have accepted it.

So, the only option would be to actually wire transfer the money at a cost of around $500. You still think that it's normal to loose $500 *and* the interest on the amount transferred, just to show you are serious? I hope not. Especially not if all you have to show is a photocopy of a check which cost you nothing.

ciao!
Nick.

Who charges that much? I've never paid more than $50 and I did a wire transfer last night from the US to Thailand for $30. In fact I can do online wire transfers globally now for $30 a transfer. Get another bank.

[s/v Jedi]

Originally Posted by Doodles

Get another bank.

ahem... it is the US banks that charge those high correspondence charges... I guess, I wasn't the one who got that number of $500 for a $10k wire into the thread but I have seen crazy charges like that before.

So, it's actually the US broker who should get another bank.

But why do you find it normal that some have to wire transfer real money while others only have to mail a scanned copy of a check? Is that equal to you? Do you think a potential buyer who has to fly 7.000 miles at considerable cost to come and look at a boat is less serious than one who send a copy of a check?

ciao!
Nick.