English couple looking to buy a yacht in Florida

[adlib2]

Originally Posted by Centreboard2017

Hi - we need help please!
We live in the UK and are fairly familiar with the buying process and contract and deposit system over here. We thought that the process would be the same in the US. We have put in an offer on a french registered yacht and the broker is requesting a deposit, so far so good. He has asked us to pay 10% into an escrow account. We read that any account should be with an Attorney but in this case the payment goes directly to the broker. We also asked for proof of VAT paid status, proof of registration when the boat was new and check that there are no outstanding debts against the boat.The broker has so far not produced any of this although he assures us that this is all in order and that after the survey all the paperwork is checked. However, once the survey is done we only have something like 48 hours to accept or reject the boat - how can we do this if we haven't checked the paperwork? Argh!

I would be really grateful for any advice - is this all normal process in the US? We thought that yacht buying would generally be a similar process everywhere, maybe we are being a bit naive?

I'm fixing up my Irwin 43 to sell. Fully loaded and doesn't need much more fixing. I'm in Florida, although, Canadian registered and in fresh water most of its life. contact me if interested

[Dave22q]

If they are unwilling to show the paper work NOW I would stay away. Foolish to invest in a survey if the papers are not available. Also a 10% deposit should follow the acceptance of your offer not precede it. A request for 'earnest money' of a thousand or so is not unreasonable. It keeps out many frivolous bidders.

[Lionelsole]

Originally Posted by Pete7

Beg to differ, but a selling an EU VAT paid vessel outside the EU also causes the vessel to loose its VAT paid status.

Pete

That is also my understanding.

[PuttingDoctor]

For peace of mind and buyer insurance why not employ a documentation agent?

[svlamorocha]

Originally Posted by CarstenWL

Pete7, svlamorocha

Thanks for the heads-up. I once saw that if the VAT paid boat change hands and is reimported by another than the exporter, VAT is due irrespective of the period of absence but did not find the EU law underlining this when I searched for it a while back.

Regards,

Carsten

You can find the gory detail in these documents:

• Customs duty and CAP charges at import: Regulation (EC) 450/2008 implemented by Commission Implementing Regulation (EU) 2016/481, Decision 1/96 of the EC-Turkey Customs Co-operation Committee
• CAP export refunds: Regulation (EC) 612/2009
• CAP import and export licenses and advance fixing certificates for agricultural products: Regulation (EC) 376/2008
• repayment of CAP export levy on returned goods: Commission Implementing Regulation (EU) 2016/481
• VAT: The Value Added Tax Regulations 1995, Regulation 121D

I am not good enough to tackle those, hence I trust the following:

https://www.gov.uk/government/public...d-goods-relief

Key text follows:

"2.4 What are the conditions for relief from VAT
To be eligible for VAT RGR you must:

Be shown on the original export declaration as exporter and the re-import declarations as the importer.

The goods must be re-imported in an unaltered state, apart from any work that may have been required to maintain the goods in working order.

Any work done must not have upgraded the goods to a higher specification or increased their value.

To remain eligible for RGR the goods must not have been exported for the purpose of repair or process. However, if they are being returned unaltered, relief may be available.

The goods must be re-imported within 3 years of the original export
Longer periods will be considered by us on application to NIRU on the full eligibility requirements for waiver of the 3 year time limit."

All that said, nothing in here requires that the owner be the same at import and export time. Therefore it might be possible to get this relief after a purchase outside Europe, provided the old owner/exporter is available to sign the papers at import time...

[Woodland Hills]

I just ordered an Abstract of Title from the US Coast Guard and recieved it by email the next business day. The cost was $25. Ordered on line Friday and recieved on Monday morning. Just Google "documented vessel search", go to the noaa link, you can put in any name of any documented boat and find the current owners. If an LLC, go to the Secretary of State where the LLC is located and do a search, if there are recorded liens against the LLC they will show up. You can also get a Certificate of Good Standing showing the LLC is current in all its required reporting. The online searches are free, the docs have to be bought.

The abstract will show liens against the vessel, but be aware that under maritime law, not all liens will show up. There may still be outstanding, but unfiled claims against a documented vessel that turn up later. You can protect yourself somewhat by asking the Seller to indemnify you against these unknown claims. Sellers typically will only do this for the period that they owned the boat.....

[CarstenWL]

I just ordered an Abstract of Title from the US Coast Guard and recieved it by email the next business day.

... the OP is looking to buy a "... french registered yacht ..." currently in the US.

Regards,

Carsten

[boatman61]

Originally Posted by CarstenWL

... the OP is looking to buy a "... french registered yacht ..." currently in the US.

Regards,

Carsten

Thats one of the things about an American forum.. everyone assumes everythings American..

[CarstenWL]

Thats one of the things about an American forum.. everyone assumes everythings American..

We have to do more noise here

Carsten

[hamburking]

FWIW, the broker wants the 10% deposit because that will become his commission. He is looking out for himself. That's his pay. Be sure to to have in writing that the deposit is refundable. Also, the survey is not "pass/fail"...the clause is usually "to the satisfaction of the buyer". Which means you can bail at any time. Too often I've seen the "accidental" typo of "to the satisfaction of the seller". Oh how they try.

Have a long talk with the broker. See if you trust him. When dealing with a broker or a private owner, trust is important. If you can't trust him, you can't buy the boat.

[Woodland Hills]

Originally Posted by hamburking

FWIW, the broker wants the 10% deposit because that will become his commission.

Have a long talk with the broker. See if you trust him. When dealing with a broker or a private owner, trust is important. If you can't trust him, you can't buy the boat.

In Florida, the standard commission is 6%, the deposit is 10%, so that if you don't pay for the survey or the haul out the broker has enough on hand to cover their services.

I beg to differ about your statement that if you can't trust the seller, you can't buy the boat. The entire process with brokers, surveys, deposits and escrow accounts is precisely so that the two parties DO NOT have to have personal trust to make a fair deal. It is the same way with real estate sales: I just sold a property for $1.1m to a perfect stranger with no issues whatsoever, in fact to this day I have never met or even seen them. And why should I? Their credit was good, the bank financed them and they had all the inspections performed to their satisfaction before the closing when the escrow company sent me the check. I trusted the system, not the individuals and so did they.

[bootneck]

Originally Posted by CSY Man

What was the big problem?
I have bought plenty boats and houses in Florida and never had any issues.
Just curios, if both parties are motivated, the boat (or house) are in decent shape, no liens
and financing in place. What went wrong?

Nothing went wrong, but no-one seemed to know the entire process and unless we asked we weren't told, problem was it was our first boat purchase so we didn't known what to ask or who's advice was sound

[CSY Man]

. Thats one of the things about an American forum.. everyone assumes everythings American..
__________________

Aye Mate, this started as a Norwegian forum with a Norwegian moderator, but then the Yanks moved in and took over.
Same thing when Leif Erickson discovered North America. All good for a while but then the masses moved in and us Norwegians became a small minority.

Nothing went wrong, but no-one seemed to know the entire process and unless we asked we weren't told, problem was it was our first boat purchase so we didn't known what to ask or who's advice was sound

If the broker did not know the entire process, or if he did not explain it to you, wrong broker.

In Florida, the standard commission is 6%, the deposit is 10%,

Real Estate is 6%, boats are 10%.

[flyingfin]

Florida broker cannot sell a French registered vessel, unless the vessel is not physically in Florida. Vessel must be imported and cleared thru customs first.

10% down is what they want, but I have bought many boats with $500 deposit subject to Sea Trial and Survey. And do Sea Trial first, if she cant get away from the dock or the engine overheats on the way out of the marina, you have not pissed away any money on the Surveyor yet!

A contract is what two parties, Buyer and Seller, decide. No such thing as a standard contract.

Right now, you are the Buyer with $$$$, do not relinquish your position.

Big issue with fees/title/sales tax will be where will you keep her if you purchase?

[sailpower]

Originally Posted by Woodland Hills

In Florida, the standard commission is 6%, the deposit is 10%, so that if you don't pay for the survey or the haul out the broker has enough on hand to cover their services.

No, that is not correct.

The "standard" commission is 10%.

The split is often 6% to buyers brokerage and 4% to sellers brokerage although sometimes it is 5% - 5%.