Lenders not recognizing USCG documentation

[jmschmidt]

As I have warned several times before, don't state register a USCG documented vessel, it will invalidate your documentation.

I've been accused on this forum as "not knowing what I am talking about" but a recent addition of the BoatUS magazine verified this exactly. You can't have a USCG documented vessel and a state registration simultaneously. If your state has a personal property tax on boats and your boat is USCG documented you should contact that state's tax authorities and they will provide a decal to affix to the boat to notify the tax investigator who prowl marines and anchorages for people who are not paying the tax that you are cleared tax-wise.

Unfortunately there are state tax agencies, as well as boat lenders, who have no clue about a USCG documentation or the Preferred Ship Mortgage that goes on record at the USCG (just like a mortgage on your home) and is the correct and only way to secure a loan on a documented vessel.

[rslifkin]

Originally Posted by jmschmidt

As I have warned several times before, don't state register a USCG documented vessel, it will invalidate your documentation.

I've been accused on this forum as "not knowing what I am talking about" but a recent addition of the BoatUS magazine verified this exactly. You can't have a USCG documented vessel and a state registration simultaneously. If your state has a personal property tax on boats and your boat is USCG documented you should contact that state's tax authorities and they will provide a decal to affix to the boat to notify the tax investigator who prowl marines and anchorages for people who are not paying the tax that you are cleared tax-wise.

Unfortunately there are state tax agencies, as well as boat lenders, who have no clue about a USCG documentation or the Preferred Ship Mortgage that goes on record at the USCG (just like a mortgage on your home) and is the correct and only way to secure a loan on a documented vessel.

Sorry, but you're wrong. You can't display state registration numbers on a documented vessel. But a state can absolutely require you to register the boat. In NY, when you register, you tell them whether or not the boat is documented. If it's not, you get numbers to display. If it's documented, you don't get numbers and just get the sticker to indicate the reg is current.

[PJS]

Originally Posted by pjShap

That's my situation too. BUT the significant cost for me was sales tax on the purchase price, required when the boat is first registered. The NY registration is inexpensive. Sales tax not.

Yes, indeed. WA State requires the registration mostly, in my humble opinion, due the money factor. A sphincter pucker factor when you have to cut a check of $18,000 to the State for the privilege of having my boat in their waters.

[Rackman]

NY requires a state registration even with USCG documentation...

[garyfdl]

Originally Posted by jmschmidt

As I have warned several times before, don't state register a USCG documented vessel, it will invalidate your documentation.

I've been accused on this forum as "not knowing what I am talking about" but a recent addition of the BoatUS magazine verified this exactly.

I'm sorry, but you don't, and neither does BoatUS if your claim is correct.

From the Wisconsin DNR website:

"Federally documented boats operating on Wisconsin waters must also be registered in Wisconsin if Wisconsin is the state of principle use or if the boat has been used in Wisconsin for a period in excess of 60 consecutive days; only exceptions being documented commercial fishing vessels"

Are you sure you're not confusing registering with titling?

[Scubaseas]

Perhaps you mean to say don't state title a boat. States will most definitely want you to register the boat. How could you pay them if you didn't?

From BOATUS:
"...Can a boat be both titled and documented?
No. A documented vessel may not be titled by a state. However, some states may require documented vessels to maintain their state-level registration. Regardless of registration status, all vessel owners must comply with state laws and pay applicable state taxes...."

There is a difference between Registration and Title. Almost all States require some kind of registration but a USCG COD is the title and what the bank wants. You can not have a State Title and a USCG COD. You can have a state registration and USCG cod.

See also https://www.boatus.com/expert-advice...mentation-faqs

In Maine if you have a USCG Documented boat you do not register it but you DO need to pay annual excise tax on it. And keep a valid sticker on it.

Originally Posted by jmschmidt

As I have warned several times before, don't state register a USCG documented vessel, it will invalidate your documentation.

I've been accused on this forum as "not knowing what I am talking about" but a recent addition of the BoatUS magazine verified this exactly. You can't have a USCG documented vessel and a state registration simultaneously. If your state has a personal property tax on boats and your boat is USCG documented you should contact that state's tax authorities and they will provide a decal to affix to the boat to notify the tax investigator who prowl marines and anchorages for people who are not paying the tax that you are cleared tax-wise.

Unfortunately there are state tax agencies, as well as boat lenders, who have no clue about a USCG documentation or the Preferred Ship Mortgage that goes on record at the USCG (just like a mortgage on your home) and is the correct and only way to secure a loan on a documented vessel.

[Cadence]

Originally Posted by unbusted67

I’m selling a boat in the state of Maine. Maine does not require state registrations when a vessel is Coast Guard Registered. The boat has a a valid COD from the Coast Guard that I have provided the buyer so that he can go to the bank and obtain financing. The bank is saying they need a state registration for proof of ownership. Has anyone else had any experience with this? I’m finding it super annoying as the national registration is a level above state in officialness

I'd bet it has something to do with the difficulty involved with repo.?

[Smokeys Kitchen]

Originally Posted by Scubaseas

Perhaps you mean to say don't state title a boat. States will most definitely want you to register the boat. How could you pay them if you didn't?

............

In Maine if you have a USCG Documented boat you do not register it but you DO need to pay annual excise tax on it. And keep a valid sticker on it.

+1 in Washington. Documented vessel with a state registration - not a state title. So they can collect the excise tax on it. We get an annual sticker - not state WN numbers - that we need to put on the boat for proof of payment.

[Scubaseas]

Your buyer should have his bank call his Town Clerk. If the boat was registered in Maine, that would indeed be the title for the boat BUT since it's Documented there is no way the registration is the title in Maine. Your buyer needs a bank that knows what is right or to enlighten them. Hope your sale goes through. Maybe try People's United bank. I have found them to be quite good.

[flyingfin]

Originally Posted by jmschmidt

As I have warned several times before, don't state register a USCG documented vessel, it will invalidate your documentation.

I've been accused on this forum as "not knowing what I am talking about" but a recent addition of the BoatUS magazine verified this exactly. You can't have a USCG documented vessel and a state registration simultaneously. If your state has a personal property tax on boats and your boat is USCG documented you should contact that state's tax authorities and they will provide a decal to affix to the boat to notify the tax investigator who prowl marines and anchorages for people who are not paying the tax that you are cleared tax-wise.

Unfortunately there are state tax agencies, as well as boat lenders, who have no clue about a USCG documentation or the Preferred Ship Mortgage that goes on record at the USCG (just like a mortgage on your home) and is the correct and only way to secure a loan on a documented vessel.

So Wrong. You can cruise thru Florida with a documented vessel, but if you decide to stay or live here you will need an FL registration.

[Philosophical]

I think if you read Maine regulations you’l find only in the case that your USCG documentation is required are you allowed to forgo state registration. On pleasure craft documentation is strictly optional, thus state registration is required.

[Scubaseas]

Originally Posted by Philosophical

I think if you read Maine regulations you’l find only in the case that your USCG documentation is required are you allowed to forgo state registration. On pleasure craft documentation is strictly optional, thus state registration is required.

I live in Maine. I have both documented (mother ship) and undocumented boats (dinghy) in Maine. If your boat is USCG documented that is the title to the boat. There is no registration requirement in Maine for a USCG boat to be registered. You DO however have to annually pay the excise tax and get a sticker that goes on the bow. The non USCG boats have to be registered and they get a different sticker than the USCG documented boats. If the OP's bank is concerned about the title and putting a lien on it for a loan the USCG doc IS the title in Maine.

[Montanan]

Originally Posted by unbusted67

I’m selling a boat in the state of Maine. Maine does not require state registrations when a vessel is Coast Guard Registered. The boat has a a valid COD from the Coast Guard that I have provided the buyer so that he can go to the bank and obtain financing. The bank is saying they need a state registration for proof of ownership. Has anyone else had any experience with this? I’m finding it super annoying as the national registration is a level above state in officialness

Maine is a boat registration only state and does not issue titles. Hence a financing company can not perfect a mortgage lien on the vessel with the State of Maine, but a vessel that is documented with the USCG avails a Federal titling of the vessel and the ability to perfect the mortgage lien by registering the notice of lien with the USCG Naval Documentation Center. Seems like your buyer's lender is ignorant of how to perfect their lien and as to how to garner documented assurance of ownership. Nota bene: Neither USCG documentation nor State titling or registration are true proof of ownership, they are merely evidence of ownership and State titling or USCG documentation avails priority and perfection of claims of liens.

Good luck with the sale of your boat.

[flyingfin]

Originally Posted by Orion Jim

Contact a local yacht broker and pay him for his advice....not to be confused with a listing fee. He will have surmounted this obstacle numerous times in his career and can point you to the easiest and simplest solution. An hour of his time paid in cash would be a wise investment.

Best advice so far,,,,, hire somebody and git 'er done!

[Island Time O25]

Some time ago I have learned that up until 1970s or may be 1980s USCG documented vessels were exempt from all kinds of State controls including taxes. Then came a decision of some Federal court which interpreted this long established view of the law differently and going forward the States started agressively pursuing documented vessels.

As I do not recall if that Federal court decision was at the SCOTUS level I can't say if it can be challenged at this point. Having vaguely remember reading the actual applicable statute I recall that my initial analysis was that the States were overreaching as was the court which interpreted that statute in States' favor.

Too bad we the boaters do not have a strong enough association such as AAA, ACLU or NRA to lobby against such power grabs on the State level. BoatUS et als are a joke at this point, more of ancillary insurance salespeople than anything else.