Broker Expenses

[geauxcruise]

Looking for some insight on who pays a Brokers travel expenses? Example: Broker is Alabama and 2 boats he has suggested we look at are in South Florida, which is going to require air travel, hotels rooms, etc. What is normal? Just in case its a $$ sensitive issue, price range of vessel is between 250K to 325K. Thanks in advance to anyone who can offer some insight.

[denverd0n]

HE is the one who suggested these boats. He can pay his own travel expenses. At least, that's how I would look at it.

He makes his money by sharing the commission on the sale of the boat. Traveling to see boats is a normal cost of doing business for him. Flights and hotels might not be all that "normal," but if he is the one suggesting that this travel is necessary, then I would not be willing to pay his expenses on top of the commission he is going to make when I buy a boat.

If you are located in Alabama, and he is telling you that you have to go to Florida to find the kind of boat you are looking for, perhaps what you need to do is find a good buyers broker in Florida to work with.

[hellosailor]

I wouldn't expect the broker is suggesting he be brought along. You need a SURVEYOR in those locations, but the broker has no business there.

He's just telling you that he found a boat you might like. He's done his work, on a multiple-listing boat. And if you buy it as a result, he gets past of the commission.

[Zven]

The same boats are probably also listed with other brokers, often located much closer!
Some times it can take a bit of detective work to figure out who is the best person to deal with.

[Cheechako]

Usually you would go look at the boat rather than a broker. Or send a surveyor from that area for a quick evaluation. Many brokers don't seem to know that much. I once had one go to a boat in Florida, I was in WA state. I talked with him on the cell phone while he was at the boat and, being in Florida, asked "so how powdery/flat is the gel coat on the deck etc?" He said it looked good.
When I got there to the boat later, it was so UV depleted it would leave heavy white residue on your hand when you rubbed it.
Are you dedicated to that broker for some reason? Be careful about that as he is likely trying to get a commission pointing you toward boats not in his area. Not a big deal, t it's nice to have a broker just deal with his area, you don't need a broker to locate a boat somewhere else now days...

[geauxcruise]

Originally Posted by geauxcruise

Looking for some insight on who pays a Brokers travel expenses? Example: Broker is Alabama and 2 boats he has suggested we look at are in South Florida, which is going to require air travel, hotels rooms, etc. What is normal? Just in case its a $$ sensitive issue, price range of vessel is between 250K to 325K. Thanks in advance to anyone who can offer some insight.

Ok, thanks everyone for the comments. But I need to update my original post.
The wife and I came to look at 6 vessels WITHOUT our Broker present. He set up all meetings and appointments. Vessel #6 was THE one! Offer made and deal accepted. NOW, a new question? Does Broker come to the Sea Trial, Survey Inspection, and Mechanical Inspection at his own expense?

[Paul L]

Originally Posted by geauxcruise

Ok, thanks everyone for the comments. But I need to update my original post.
The wife and I came to look at 6 vessels WITHOUT our Broker present. He set up all meetings and appointments. Vessel #6 was THE one! Offer made and deal accepted. NOW, a new question? Does Broker come to the Sea Trial, Survey Inspection, and Mechanical Inspection at his own expense?

Probably on the sea trial. They need to make sure this thing closes to get paid, so being there helps to negotiate any issues or coldfeet that might show up. It's on their dime.

[wandering rober]

The broker does not have to come to any of them !If he does it is to protect his interest .

[hellosailor]

Jeez. Let's try it again.
THE BROKERS JOB IS TO FIND THE BOAT. And secondly, to communicate your offer to the seller.
That's it. That's all. IF the broker is representing the seller, and IF the seller has engaged them to be there for the survey and sea trials, that's between the SELLER and the BROKER.
If your seller is just some shmoe who used the multiple listing service? No, his job was not contracted with the seller. You asked him to FIND A BOAT and he did that. And You've got a contract that spells out anything else, or you've got nothing else.

The seller's broker will probably be there to make sure you don't trash the boat. That's on them. Without them, you probably won't get into the boat, or much of anything else. Neither broker replaces the surveyor that you should have.

[Paul L]

Originally Posted by hellosailor

Jeez. Let's try it again.
THE BROKERS JOB IS TO FIND THE BOAT. And secondly, to communicate your offer to the seller.
That's it. That's all. IF the broker is representing the seller, and IF the seller has engaged them to be there for the survey and sea trials, that's between the SELLER and the BROKER.
If your seller is just some shmoe who used the multiple listing service? No, his job was not contracted with the seller. You asked him to FIND A BOAT and he did that. And You've got a contract that spells out anything else, or you've got nothing else.

The seller's broker will probably be there to make sure you don't trash the boat. That's on them. Without them, you probably won't get into the boat, or much of anything else. Neither broker replaces the surveyor that you should have.

A broker job is more than this. It stops when the deal is closed. Too many 'deals' fall through for lots of real or emotional reasons. The broker does not get paid unless the deal closes, so they are motivated.

[Auspicious]

Originally Posted by Paul L

A broker job is more than this. It stops when the deal is closed. Too many 'deals' fall through for lots of real or emotional reasons. The broker does not get paid unless the deal closes, so they are motivated.

Disclaimer: among many other boat-related sins I am a sometime yacht broker.

I basically agree with hellosailor. Only basically because nothing is simple.

Foremost not all brokers are created equal. Some know more than others. Some work harder than others. Some are more active than others.

A broker working with a buyer may spend the time to get to know you and your plans, your constraints, and your standards. S/he will then bring additional boats to the table you might not otherwise have contemplated. If you go to see a boat s/he will look for other comparable boats geographically convenient to visit. Even if those extra boats are not themselves candidates discussing what you did and did not like helps the broker find "the" boat for you. A good broker will also help you identify and consider aspects of a candidate boat that can or cannot be changed at reasonable expense. There would be screening either by a preview or a phone call with the listing broker to save you time and effort. When you find "the" boat there are all the mechanics of offer, survey, sea trial, and negotiation. A good broker can make those go more smoothly. Brokers, fair or not, have access to information you simply don't have such as the prices other boats have actually sold for.

On the other side, a good selling broker will present your boat in the best possible light to make it sell at a good price. S/he will encourage or nag you to clean the boat, get all the extra stuff off, help with pictures (if I see one more picture of a marine toilet I'm going to scream), and be responsive to expressions of interest. Again, there are all the mechanics surrounding an offer.

In this day of the Internet, other than sellers access to Yachtworld, can you do all that work yourself? Mostly but not all. It is up to the broker to earn their place.

As far as who bears what cost that is ultimately up to the customer and the broker to agree. While some brokerages have policies there are no rules or laws. Let's be really practical. The net amount of work to sell or buy a boat is about the same regardless of whether the boat sells for 25k, 250k, or 1.25M. If a customer is looking at boats in the high six figures I'm going to do what I can to make the task simple and pleasant. I'll pay for more of my expenses for a serious customer because my upside is better. On the other hand if the boats are in the low five figures having me join you in Ft Lauderdale while you are there in business to crawl through a bunch of boats over the weekend is going to be on you. I'll surely spend the time with you on the phone, Skype, or Facetime on or after boat visits. If you pay for the plane ticket I'll make the effort to find a boat or crew house for accommodation, but I won't pay for a motel. My piece of commission just isn't worth it.