Nightmare Buying - Broker Threats

[Mike Banks]

You need do two things, first get a lawyer, although this will probably cost six grand by the time he is through--and lay a complaint to the licensing authority that deals with brokers.

Make sure your evidence is sound. That sort of broker, if what you say is true, should be struck off, because of an obvious conflict of interest.

One can either represent the vessel owners or the purchasers, but not both at the same time UNLESS THERE HAS BEEN A SPECIAL CIRCUMSTANCE TO WHICH BOTH VENDOR AND PURCHASER HAVE AGREED IN WRITING.

Preferably this agreement that the broker can act for both parties should have been made on a separate agreement to a purchasing contract--and the conditions for remuneration stated clearly at the outset.

The broker can not usually nominate himself as both and thereby hope to extract a double commission, or to ensure there are no disagreements that might occur were there to be two separate buyers and sellers representatives negotiating a price and conditions----as there should be.

Buy hey--I am no expert on American Agreements--but if this was to have occurred in Australia, that situation would soon be resolved by a complaint to the commissioner for corporate affairs, auctioneers and agents section, a consumer protective government agency.

[Pelagic]

Originally Posted by Pelagic

The Brokerage company, not the broker, controls that escrow account.

My advice would be to contact the principal of the Brokerage Company with a documented complaint of this Broker's behavior

Offer a solution that he tries to resolve the survey issues with the Seller to salvage a deal.

Failing that, demand a refund of your deposit and itemize your expenses to date trying to work thru a misrepresented listing by your broker.

Let him know that this is being followed closely in a large sailing Forum , but you have not named Names YET!

Let his boss try to diffuse the situation first.

Glad you followed my advice
...Good luck in further negotiations

[Fiveslide]

Originally Posted by Tspringer

But the boat is 32 years old.

Pardon the interruption.

What financial institution is financing 32 year old boats? I'm genuinely curious, with a little loan, I could really expand my boat search. Everything in my price range is old and tired, if I got a loan I could buy something not quite so tired.

[Tspringer]

Originally Posted by Fiveslide

Pardon the interruption.

What financial institution is financing 32 year old boats? I'm genuinely curious, with a little loan, I could really expand my boat search. Everything in my price range is old and tired, if I got a loan I could buy something not quite so tired.

Sterling approved the loan, a pleasure to work with.

[sail sfbay]

When I recently purchased my Hunter 46 sailboat there were a number of survey recommendations. I signed a "Letter of Compliance of Marine Survey Recommendations". It stipulated that al the recommendations have been complied with at the time of sale, with any exceptions and planned completion dates. I stated I would complete the survey recommendations after I take possession. That was acceptable to the underwriter. After taking possession I completed all the recommendations, including those that I received a "Repair Allowance" (deduction off the initial agreed offer) from the seller for.

[sail sfbay]

If you really want this boat then request a "Repair Allowance" (or deduction from the agreed price) as a result of the survey.

In addition, sign a "Letter of Compliance of Marine Survey Recommendations". It stipulates that al the recommendations have been complied with by the time of sale, with any exceptions and planned completion dates.

On my recent Hunter 46 purchase I did both of those and on the Letter of Compliance of Marine Survey Recommendations I stated I would complete the survey recommendations after I take possession. That was acceptable to the underwriter. After taking possession I completed all the recommendations, including those that I received a "Repair Allowance" from the seller.

[rbk]

One thing I didn't see mentioned by the OP is that he mentioned it was financed, yet no mention of subject to financing. If you entered this agreement without a financing clause and financing fell through for whatever reason, you could very easily lose your deposit (best case) or have the sale forced in full by the courts (not as bad) or if the seller can show cause, liable for damages (worse); You could go back and try and sue the broker/agency but it gets messy quick when E&O gets involved. If the original broker left this out, I would be mentioning that to his boss.

[KP44]

Another thing to remember in the future is that the amount of earnest money is your choice. Most brokers try to insist on 10% or more, but there is no law to back that up. Zero earnest money is possible and $1,000 is usually plenty to interest the seller unless there are other buyers standing in line.

[rbk]

^^x2 Also just because you’re ‘pre-approved’ for the funds doesn’t mean you’re approved to buy a high risk or overvalued asset. Banks don’t want you to default, they want their interest payments.

[Mike Banks]

Generally speaking, for the purchase of a boat (unlike hailing a cab) valuable consideration, usually in coin of the republic or realm, is required. It just need not be ten percent--which covers the broker. That is why brokers insist on that amount of deposit. I would too if I were a broker dealing with two parties both strangers to one another and myself.

[lelolay]

Originally Posted by Tspringer

I find myself in a downright surreal scenario that feels like a bad twilight zone episode. The listing broker - who contractually is also my broker according to the purchase and sale agreement - has deliberately and repeatedly misrepresented the vessel (in writing), lied to me, cursed and screamed at me, called my insurance people and screamed/cursed at them, and is now threatening to withhold $6,000 of my deposit on the boat. This quick description does not scratch the surface of all that has taken place. I have comprehensive documentary evidence of ALL of it.

Now I cannot close on the purchase of the boat because the survey notes over 15 different essential repairs that would be required for the boat to be seaworthy. The survey has been rejected by 5 different insurance companies. They will not write the insurance until the repairs are done.

When 3 of these insurance companies had rejected the survey, I engaged the broker. He screamed at me cursing that I had messed up the entire insurance process and potentially killed the deal by disclosing too much information to the insurance underwriters and because of my screwing up the deal, he was going to hold back $6,000 of my deposit money if I did not pay out of my pocket for the repairs the insurance required prior to closing. He wants me to pay to repair someone else's boat. Repairs some of which he had assured me in writing had already been completed - straight up lies. He says the $6K is to cover his travel expenses, commissioning the boat for the survey, re-winterizing the boat, for removing and then installing new shrink wrap on the boat (note that at survey the shrink wrap was NOT removed) pay for his time spent on the survey and working on the deal. He is absolutely insistent (screaming - literally) that HIS insurance contacts would have gotten the policy bound without any issues at all and so all of the problems were caused by me and this justifies his keeping $6K of the deposit on the boat.

So I cannot buy the boat because it is impossible to get insurance due to boat condition issues and the broker says he is keeping $6K of my deposit.

Do I need a lawyer? This is a complete disaster. I did not enter into this seeking a legal nightmare - I want to buy a boat.

Yes you need a lawyer. Usually a letter from one will suffice. Would you buy a house without an appraisar? An if most of the deal was done out of his office the 3 dys rule apply. Now an agrrement should have been made about the incidentals in surveys an who pays who. Unpacking an packing. Winterize an who. Haul out an such.....Yes check with a lawyer they are free most for a visit. The letter won't be. GL

[Scaramanga F25]

Had you accepted the vessel at survey???

[TheThunderbird]

In the portrait one figure is missing. THE OWNER/SELLER

in theory, the down payment is due to him, not to the broker, in the form of a bank check to be withheld till final approval of sale.

On top, Owner has primary interest in completing the sale, and having you as buyer, by fixing all items reviewed, or compensating for them.
(Btw, the check had to be in the Owner name, not the broker's!!).

Please contact the Owner, he could be your best ally.

[sailorboy1]

I would like to know the outcome, but don’t want to read 5 pages of the same posts ☹️

[valhalla360]

Originally Posted by newhaul

ok then do it this way withdraw your offer have the seller remove the vessel from the brokerage. Have him fix the issues and deduct the cost of this fiasco out of the purchase price and do the deal privately . Just use a title company not brokers.

We did similar when we sold the Spencer just had to wait the requisite 6 months after taking the boat out of the brokerage.

Be very careful doing this...especially since you have a kook as a broker...even with the 6 month delay, the broker could claim he put you together and you are trying to circumvent paying his legitimate commission.