Re: US Practise of Deposit With Boat Purchase
 

I have! I put down a 10% deposit on a Vancouver 36, had a survey and sea trials and we could not come together on adjustments to the price so I walked. My broker asked if I wanted the deposit back or just held for my next offer. I had them hold it because I knew I was going to buy something soon. The next boat (Dickerson 37) we made an offer on was rejected outright by the seller. He wanted the list price period! We move on the our third offer (Wauquiez Pretorien) which we eventually negotiated a successful deal on and the original deposit was applied to that sale. If I had gotten the money back each time if would have been a pain because the brokers insist on wire deposits not bank or cashier check (for good reasons that I understand).

By the way, the Dickerson is still for sale and at the same price and that was two years ago. He shouldn't taken my offer. :D

Re: US Practise of Deposit With Boat Purchase
 

Why would the broker know where the seller is prepared to go?? Things change on a monthly basis, I was contacted by a guy here in Spain regarding a boat he has had for sale for the last 6 months, the boat did not suit our needs but we have stayed in touch and met a few times!! He sold this boat 3 weeks ago for 40% less than the price he put to us, why? well, he told me he could just not afford the mooring and maintanance anymore! The Broker told him that he could have sold the boat 6 months ago at this price, he asked the broker why he had not told him that, the broker replied he did not realize the guy was so keen to sell...........A broker wont know the ins and outs of a sellers everyday life which can be changing on a monthly basis......I would think a seller would not want the broker to know everything anyway!! Again, I would not be prepared to pay 10% to anyone just to ask if a boat that I liked the look of would go for less than the listed price or if the seller was flexible! I would have thought most sellers who have had a boat on the market for a while would want to hear from the broker of ANY enquiries made about thier boat, these would be greatly reduced in my opinion by brokers asking anyone enquiring about a boat price for a 10% deposit!!

Re: US Practise of Deposit With Boat Purchase
 

Pablo, remember that they're in this for money and there are often more buyers out there besides you. No doubt some of the brokers are screwing it up for the seller, but lots of times they just aren't going to give you much time if you're offers are low. Sellers often have more time than you think to wait out a sagging market.

I just sold a Cape Dory 30 after 6 weeks on the market. When it was for sale by owner, I had two offers- one German, one Irish, that were way below the price I sold the boat for. The broker would have screened these buyers, who really did take loads of my time and may never actually buy a boat. All of the buyers that kicked the tires on my rig are still boat-less after at least a year. How does someone shop for a basic 30 foot boat for over a year and not have a boat to sail? Some like to shop, some like to sail. Just because it is a "buyers" market does not mean all owner are looking to give their yachts away.

If you make a decent offer, rarely will a broker turn it down. Sellers often have a clear idea of value in their minds, right or wrong. Go too far below that and they'll blow you off. Nothing wrong with making low offers, just be prepared to not be taken seriously.

Good luck-

csh

Re: US Practise of Deposit With Boat Purchase
 

I serious doubt the seller was prepared to take 40% less six months before. If he was he sure as hell should have told the broker! Wouldn't you be letting the broker know something like that? Sounds like the seller was in a bind, wanted a lot more but couldn't hang on due to financial problems and finally gave in.

Re: US Practise of Deposit With Boat Purchase
 

I'd be very interested if, when you do buy a boat, you come back and tell us how it worked out for you. You can't even buy a used car from a dealer without a deposit with the offer.

The offer (with a deposit) is the usual starting point for negotiating a final sale price. With any high ticket item, there usually is negotiating, a deposit with the offer shows you are a serious buyer.

Re: US Practise of Deposit With Boat Purchase
 

Just as an aside, everyone says it's a buyers market but all I see is buyers on various sites complaining about not being able to buy a boat. What's the story here. It seems the sellers don't realize that it's a buyers market. :)

Re: US Practise of Deposit With Boat Purchase
 

I have been on the receiving end of this ******** twice. I paid two deposits, both offers were rejected and I finished up with no boat. I don't mind saying the whole business pissed me off no end.

It all cost me $600 in bank fees to move that money around and for what ?

Bloody nothing !

I'm a big boy and can handle rejection. If someone else comes in over the top with a bigger offer during the few days while I'm negotiating then good luck to them. On a boat that has been on the market for a year I'll take me chances.

Re: US Practise of Deposit With Boat Purchase
 

I think many sellers realize this and are willing to be very reasonable. After all they are the ones paying for the boats, dockage/storage, maintenance, insurance and the myriad of other costs every month... But there are other factors as well that are complicating the buying process. Some of these idiots are brokers, some are sellers, some are the buyers and let's not leave out the banks.

For example: Our plan is to move up to another older larger boat for a couple of years before we purchase a large catamaran. The problem that we are finding is that most of the boats we are looking at are in the $80 - 120K range and I have yet to find a financing source that is willing to follow through and close a loan on an older boat.. I can finance a new boat all I want just not older.. There is a separate thread on this here elsewhere.

Re: US Practise of Deposit With Boat Purchase
 

There are still many owners out there with the attitude " She's my baby and you aint gittin' her cheap " attitude. I followed one such guy in Detroit for 8 months all the way to his coffin. No kidding. He kept on telling me to shove it but his children sold the boat in 2 months. I have been following another drop dead gorgeous ( except for the price ) boat in Maine that has been for sale for 3 years. Two boats that I made offers on, one in Seattle and one in RI, then sat unsold for many months. Both finished up selling at a price below my offer. HA !

Fools all.

The same thing still happens with houses but that is another story.

Re: US Practise of Deposit With Boat Purchase
 

It's weird because what is fine in one country is illegal in another country!

In Aus they are Obliged to submit any offer to the seller.


Mark

Re: US Practise of Deposit With Boat Purchase
 

Are you telling me Mark that if your boat is up for sale for say $100K and I want to offer $25K, the broker has to present a binding offer to the seller?

And if you say no not a binding offer, then what's the point.

Re: US Practise of Deposit With Boat Purchase
 

Yes thats what I'm saying. Offer and Acceptance is a common law principle backed by our fair trading laws.

In many instances with brokers (for cars, I don't know about boats) there is a Cooling Off period of 7 days. We protect the buyer.


Mark

Re: US Practise of Deposit With Boat Purchase
 

No exception? Even if I want to offer a ridiculous amount like $1,000 for your $100K boat the broker has to contact the seller, make the offer and get back to you?

Re: US Practise of Deposit With Boat Purchase
 

You seem delighted that they sold below your offer. Did you give up on these or did you buy another boat in the interim.

Re: US Practise of Deposit With Boat Purchase
 

You want to go to a house auction!!

Re: US Practise of Deposit With Boat Purchase
 

A written offer, with a fax copy of a personal check as binder, has been acceptable for each of the three substantial boats I have purchased.

If the broker needs cash or a cashiers check move on.

Re: US Practise of Deposit With Boat Purchase
 

An auction is different. I understand "offer and acceptance" in that context and we have that as well. There is a difference between putting your boat on eBay and listing it with YachtWorld ... don't you think?

Re: US Practise of Deposit With Boat Purchase
 

We're talking about an international transaction. Would you accept a check from another country in a foreign currency that you can't deposit in your bank? If so, I've got a bridge to sell you. :flowers:

Re: US Practise of Deposit With Boat Purchase
 

Remember a personal check (or cheque) can't be used by a foreigner buying in the USA. Unless they have a USA bank account, I spose....

Re: US Practise of Deposit With Boat Purchase
 

Everything is negotiable and the broker is obligated to submit all offers! The last boat I sold the buyer negotiated the price BEFORE he traved cross country to see the boat. No deposit till he saw the boat. I was fine with that and we made a satisfactory deal.

Re: US Practise of Deposit With Boat Purchase
 

Only if it's from Nigeria. :)

Re: US Practise of Deposit With Boat Purchase
 

At last, some common sense, well done Tingum, its people like you that we want to do business with!! :thumb:

Re: US Practise of Deposit With Boat Purchase
 

Most brokers don't want to bother their clients with lowball offers. A lot of brokers would rather keep the listing than go for a low offer as it makes them look bad. Sometimes you can find out who the owner is and talk to them directly, they are usually binded to the broker for only six months at a time (but you must not make contact with the broker prior to talking to the owners). If you are making a lowball offer, the deposit check is a guarantee that that offer will actually be submitted to the owner. If they accept, you are entitled to a survey (which you must pay for), and a sea trial. If something breaks during the sea trial or the boat doesn't perform to your expectations, you can back out of the deal.
When we bought our boat, the broker never even cashed our deposit check until the deal was done. We had already paid the owner. Then he cashed it for his commission which is almost always 10%. But if your broker works for a brokerage firm, he will get 5% and the firm will get 5%. If you buy from a broker in Florida, he can provide you with a 90 day tax exempt sticker, provided you are not a Florida resident. This gives you three months to get the boat out of Florida without paying tax. He can also extend it to 180 days for a $425. fee. This exemption only applies to brokers licensed in Florida and not to private sales. This is a new rule so if you do buy from a broker in Florida be sure to insist that they provide you with the tax stickers. That is my two cents but I would also insist on being present for the survey so you can do your own self survey as a lot of these surveyors are obsessed with listing the yachts equipment, electronics etc. which does you no good. They are not going to test these systems out for you. Bring a bright flashlight, a small hammer, a screwdriver, and a camera and stick your head in every nook and cranny and remove every panel that you can and remember that every little problem that you see with the boat is actually a big problem that will cost you plenty of time and money to fix. Good luck! Phil

Re: US Practise of Deposit With Boat Purchase
 

Having everything listed by an independent third party is a good idea since the survey will provide the best inventory of what's on the boat for the sales contract. If when you go to take delivery later something is missing, then you've got something in writing that says it was there at survey/sea trials.

Re: US Practise of Deposit With Boat Purchase
 

I just put the 10% down yesterday. And if the owner accepts, I will have the boat hauled out and survived.
She is an old boat with old electronics. And I know that the Loran C, the 12 channel VHF, have to be changed out with newer equipage. And a few other items need to be up dated also.
So I have the following:
Price of the boat.
haulout.
survive.
equipage up grades.
a dinghy (doesnt have one).
Other Unkown hidden costs.
Some states have the dreaded Sales Tax, up to 12% pending where you are at. Louisiana don't thankfully for boats.

So the bottom line is though the price of the boat is the big ticket line, you are going to have other expenses that will bring the overall price up to at least 10 to 20 percent higher than just the boat. So plan for it. Then you won't have sticker shock. Hopefully you won't. Ach!!!

Re: US Practise of Deposit With Boat Purchase
 

Yes and no is not required the day of the survey. a yes or no is required at the end of a survey period which could be over a 3 week time period. If on week 1 you finish up a survey, and you get a report back 3 days later, the rest of the time is left to make up your mind or do other research to see what repairs would cost etc.

Re: US Practise of Deposit With Boat Purchase
 

A offer without showing the "color of your money" doesn't make a strong impression. Anyone, especially someone without any means to actually complete a transaction can make an offer, but an offer in earnest always gets the other parties ears up. When you make an offer in earnest (with money) the broker will go to work. The seller will either accept your offer or counter an offer back to you. You are now haggling. And haggling is what it's all about...in my oppinion.

Re: US Practise of Deposit With Boat Purchase
 

There is a big difference between making an offer........and asking the broker if he thinks the seller would be prepared to lower the asking price and what that price would be!! How can you make an offer if you dont know if the seller is flexible?? My point since the start of this thread has been the following, would I be prepared to put down 10% just to find out if the seller would be flexible? No, absolutely not! However, once I knew whether the seller was flexible and I had an idea of what that figure was, would I be prepared to put down 10% (subject to survey) on an offer, yes I would! So, a BIG NO to 10% for a simple enquiry......but a yes if I got to the stage of wanting to make a solid bid to buy the boat!

Re: US Practise of Deposit With Boat Purchase
 

Personally, I wouldn't consider making an offer on any sailboat without personally seeing it and inspecting it myself, first...especially with you being overseas or a foreign country. Photos are deceptive, brokers and sellers can be dishonest, evasive or tell half truths, and surveyors can be inaccurate without you being present. From my experience it is the norm to put down 10% in the US and I have done it and I have also had it promptly refunded when the seller waffled. Good brokers can be flexible and work with you, its to their interest to work within your means, but in my opinion its quite awkward to do it
from abroad without inspecting it yourself, first... as it becomes nothing more than a guessing game. To me, boats are too personal...comparable to ordering a wife over the internet and having someone else date her for you without even knowing the person first.

Re: US Practise of Deposit With Boat Purchase
 

I agree and that is exactly what happened when we (Dutch) bought Jedi in Florida in 2002. After this discussion with the broker we decided to put in that offer and wire the 10% into escrow. The purchase agreement was very balanced (much more in favor of the buyer than what you find in the EU !!)

We first spoke with the broker on a Thursday; we flew to Florida that weekend and had a survey with sea trial and haul-out that Monday. Then we flew back to Holland and had a week of talking price down, then another week of notarizing and faxing papers and then we were the owners. Next thing we did was wire some extra money into the broker's escrow and sign off some bills from people we hired to do some work on the boat. When they presented those signed off bills at the broker, he would write them a check (no checks in the EU) so we liked the system a lot.

But a crooked broker could abuse it. Check him/her out.

ciao!
Nick.

Re: US Practise of Deposit With Boat Purchase
 

Well pablo, the bottom line is the decision is up to you. You should assume its always going to be negotiable. There is nothing here to prevent you from asking the broker for feedback on your offer, or trying to haggle before a PA, so I don't get the complaint. But, remember, neither the broker/client or the law or the market dictates whether they have to play that loose game with you. They make their decisions and again, it's up to you to play by their rules and whether you really want that boat.

Pablo: Do you think your client would accept a 40% off asking price and what they would negotiate?

Broker: Well, I cannot legally speak for what my client will and will not accept. I'm not a salesperson; I'm a broker. You can try and submit a PA as is or higher w/ 10% deposit and give him some breathing room to think about it. My client is a very busy professional and has been through quite a few bottom feeders lately, and only wants to respond to serious buyers. I cannot disturb him and must respect that.

Pablo: this is IMPOSSIBLE! What kind of business practice is this! I need to know NOW!

Broker: Oh look at the time! Sorry, I have another listing I need to show for another important client. Good luck on your boat searches in the area. And please don't let the screen door...

Re: US Practise of Deposit With Boat Purchase
 

...thats funny!...painfully true. I don't think the real issue is the 10% thing, thats just a necessary detail up the road, as long as you
know precisely/exactly what your getting into and with who you are dealing with... and taking the time to get to that point in person.

Re: US Practise of Deposit With Boat Purchase
 

I have always found in US that a 10% deposit goes with the signed offer. (when using established broker with escrow type account). Usually the broker will tell me if the offer will be accepted. They usually know what the seller will accept.

Re: US Practise of Deposit With Boat Purchase
 

I faxed a written out cheque, Canadian bank/account/funds. I went down for the survey & then wired the actual deposit to his escrow account & faxed him my revised offer. He told me that every boat he lists attracts a lot of inquiries, but most are a waste of time. Having had a small taste of auto sales many years ago, I can appreciate that one doesn't want to waste time with someone, only to find that they'll be back as soon as their lucky lottery ticket is drawn.:whistling:

Re: US Practise of Deposit With Boat Purchase
 

Erik, in the US this is called "earnest money" meaning, show me some money to prove you are earnest in making your offer, not just kicking tires. It is not restricted to boat sales, either.

If you can put 10% of your offer at risk, in someone else's hands for at least a few days, it indicates to them that you might actually be able to come up with the rest of the offer, and that you have some real interest in that particular boat, as opposed to making offers to twenty others at the same time.

These days, if you can imagine a game, someone is playing it. And yes, folks have had a broker go out of business and keep the deposit.

Like everything else this is open to negotiation. You can always reply that $US conversions are not convenient to you, that you are reluctant to send money overseas to an unknown party, that you'd prefer an escrow. Or, perhaps to send them a letter of credit or other bank confirmation that the funds ARE available to you for the purchase. (As opposed to the sale being subject to financing, which they may or may not want to hear.)

But the deposit IS quite normal. Some sellers will tell the broker "don't even call me without a deposit in the bank" because they don't want to be bothered with tire kickers. With others, it is a broker doing the requiring, or asking.

A smart broker will work with you, to your mutual satisfaction if possible.

Re: US Practise of Deposit With Boat Purchase
 

Fair statement. I missed your main point, obviously. Still, I think that you can expect most brokers to counter with, "Well, make an offer & accompany it with a deposit & we'll find out.", or words to that effect. If the broker spent time asking the seller(s) questions based on each inquiry, he/she would be working a lot of hours that didn't pay. I'd suggest that you just operate under the assumption that every boat is negotiable.

Re: US Practise of Deposit With Boat Purchase
 

Again, i feel the need to bring up what i mentioned earlier regarding a property we are selling, i dont ask for a deposit to show someone around (even though its a 2 hour round journey for me), i understand that there will be the odd time waster! Looking at the boating world I do think its time for everyone to calm down a bit and get of thier ¨¨high horses¨¨, I do fully understand that If someone is expecting trial sailing on the boat, etc that its only fair that a deposit should be paid, however, to expect anyone to pay 10% for just picking up the phone and asking you a question about a boat.....well, thats just crazy??

Re: US Practise of Deposit With Boat Purchase
 

Bottom line is that EVERYTHING is negotiable! If you do not like something in the brokers "standard contract" strike it or change it! If that broker does not like it find another. Any broker can submit a contract on another brokers listing.

Re: US Practise of Deposit With Boat Purchase
 

Pablo,

I tried to tell you that it isn't as bad as it sounds with buying a boat in the USA. You are mostly outraged about the perceived arrogance of our Yankee friends... but it isn't really arrogance, it's just that they are different :whistling: and they are so used to their ways that they think it's weird when others have different points of view. Talk to them, tell them you are serious and want to make a honest offer but want to talk a bit before sending money because that's the way it works where you come from. If they can bring up a bit of respect for that I'm sure you can work it out... we did too.

If the broker does not want to discuss price of a "probably acceptable" offer with you before paying 10% then give him your phone number and tell him to call you when he's ready to talk but you will reduce your offer 1% every day.

ciao!
Nick.

Re: US Practise of Deposit With Boat Purchase
 

Well put Nick, nearly as good as Hugh Grant on question time last night :p! I can only speak as I find, there seems to be a certain ¨arrogance¨ from certain ¨sellers¨, brokers and private alike, maybe its because they are angry that they have to sell thier boat :whistling:! Anyway, out of interest we have called a USA broker today regarding a boat we have seen on his web site, my 1st question to him was did I need to pay him 10% deposit to ask him any questions regarding the possibility of reductions on boats he currently had listed...he roared with laughter for nearly a full minute!! He has already emailed me 4 listings he feels may be happy to reduce thier asking price that could fit our budget, he has asked me for NOTHING to show I will 100% buy from him, and he has promised to keep in touch, he knows that we have not even decided yet if we will buy in the USA or EU!!
My faith is restored in the good old USA, others out there would be wise to learn from our ¨Mr Nice Guy¨!!