Broker experiences?

[O C Diver]

I’m reviving an old thread here to vent and rant having just been burned by a less than honest broker. I will state up front that I have little to no respect for commissioned sales people and that in the end is what a yacht broker is, commissioned sales. With one exception all of the commissioned sales people in any market I’ve dealt with in my life have run the gamut from ignorant of what they are selling to down right dishonest. Usually I can spot the dishonesty quickly and walk before it costs me more than a bit of my time. I got duped this time.

I just walked from a purchase post survey. The boat failed survey miserably. Costs to rectify the issues found would be in the range of 3X the purchase price, likely more. This comes after the costs for air fare + hotel + car rental for the initial visit and decision to make an offer. Then round two of air fare + hotel + car rental to attend surveys and hopefully schedule needed work. Add in the costs of engine survey and condition and valuation survey and we’re not talking pocket change.

Upon questioning the broker post survey regarding his knowledge of the condition of the boat he inadvertently let slip he knew some of the bigger issues. Big enough issues I would have walked before making an offer. Not disclosing that at the time of offer is at best unscrupulous. Possibly, depending upon location, illegal. And his story changed throughout the post survey “conversation”, names, places etc.

I’m not new to this having been on the water for my entire life professionally and as a recreational boater. I don’t have stars in my eyes and I’m not wearing rose colored glasses. I do understand that buying a used boat is a risk, it will take money and time to get it squared away the way I want and need. I do understand that the survey process is about making the final decision and that I may in my own best judgment walk eating the costs. This is not my first survey and purchase. None, not a one, have been fully above board honest and competent. But this is by far the worst.


My advice to buyers is to get EVERYTHING in writing. Every statement made about the boat’s condition by the broker. Take notes, amend the sales offer to show all said. Add a clause that if anything has been intentionally omitted that you are to be reimbursed for all costs, not just haulouts and surveys.

This does not mean you can expect more that a return of your deposit if you simply don’t like what surveys find, that is the risk you assume in purchasing a used boat. It does mean that if the broker lies or withholds information they will be held liable for all costs incurred. I know this is not possible, I understand that the potential legal fees to attempt to enforce the clause will likely exceed the funds recovered. The intent is to put the broker on notice that from the minute you consider making an offer you will hold the broker responsible for his / her actions and all costs incurred by you for their intentional dishonesty in any way.

In the end my rant is not about the $$$. It’s about honesty and integrity. Something that I have almost always found lacking in commissioned sales.

No, I won’t post the brokerage and broker’s names here because I did not follow my own advice therefore I can’t prove anything. Nor will I bad mouth the brokerage and broker to any of the other professionals here on the waterfront. The boating community is small and tight knit on most waterfronts. I may well have to do business with the surveyors and other professionals I hired for this failed purchase again.

If any of you are considering a purchase in California I will in private conversation reveal the brokerage and broker’s names. If you are considering purchasing from the same brokerage and broker I will disclose the details of the pre offer and post survey conversations.


End rant. Climbing off my soap box now. Be careful out there when buying used boats.

Was this a buyer's broker representing you or the seller's broker who represents the seller and is contractually bound to represent the seller's best interests?

Ted

 

[smitty477]

Very sorry.

When I bought my last sailboat, I was very happy with the buyers broker I used (Debbie Yeend) and was not particularly happy with the selling broker down in Marina Del Rey. They were less than forthcoming about the boat we bought and its history.

Debbie also sold my last two sailboats. She was scrupulous about how the boats were represented. I’m sure her innate honestly likely reduced the number of offers we received, but as my representative, I want a broker to be at least as ethical as I am.

When I bought my current used boat, the broker was outstanding. Completely upfront about the boats known issues and history to the point that the broker spotted potential problems that the surveyor missed. Now, the fact that the broker in this case also happens to be the owner of North Pacific Yachts makes it a bit of a special case.

My point is that good brokers are out there. Unfortunately, as buyers we don’t get to pick the brokers that list boats we may be interested in. However, as sellers we can try to ensure that the brokers we use to list our boats meet the same high standards we would like to see as buyers. Unfortunately, I think many sellers don’t give a rip and just want the boat sold regardless of how it is done.

We have seen the same as you - most brokers have been very helpful and valuable. A minority are problems that need to be watched for - that pattern has been similar to experiences with home brokers, commercial property brokers, and business brokers.

 

[JLD]

Was this a buyer's broker representing you or the seller's broker who represents the seller and is contractually bound to represent the seller's best interests?

Ted

I had the same question as Ted, was this is a seller's broker?

In addition, if not, did you use a buyer's broker? If you didn't use a buyer's broker, I would be curious as why not? No judgement, just trying to learn!

Thanks,

Jim

 

[Portage_Bay]

dhays & smitty,

I'm happy to hear you both have had postitive broker experiences. Unforunately for me my string of bad experiences with commissioned sales continues. Today's was more towards the incompetent than the dishonest. A phone call to get some general comments on the boat to be told it's in very good conditing with most of the broker's discussions about furniture, counter tops etc. I expressed my serious interest in systems and strcutural condition. Within 10 minutes I walked from the boat. Water damage to nearly all the windows when I had been told there were some minor stains. Fuel tanks near failure, Racors plugged with crud and extensive corrosion to the cooling system when I had been told all were in good shape. Teak decks in need of complete re-working when I had been told they were in good shape.

The reason I put this one in the incompetent category is that I don't think the broker had ever been aboard longer than to hang his sign on the bow. If fact I'm not sure even that long. He did not recoginze the boat as we walked the dock and wondere when he found it why the sigh was "on the wrong side?"

So, on the road for a total of nearly 6 hrs for the round trip to spend less than 10 minutes aboard before I walked off.

 

[Portage_Bay]

O C Diver & JLD,

No, I was not using a buyer's broker. My reasons are multifold starting with the fact that I am like some here shopping at the lower end of the price scale, hunting a mid to late 70's Tiawanese trawler. By the time two brokers split the commission on an older lower priced boat there isn't much to go around. I try to respect any professional's time, effort and expenses. I simply wish they would respect my time, effort and expenses.

To me it seems like the old days of bying a used car. Do your research, set your price bracket, cruise the ads and lots. Then brace yourself and don't turn you back on the used car sales person of half a second.

I did try a buyer's broker several months ago. It didn't work out well.

I may be coming to the conclusion that the dream of finding a sub $100K boat is just that, a dream. In my opinon a boat is a toy. I will not purchase a toy with a loan. If I can't pay in full for purchase, taxes and issues that need to be resloved immediately I won't purchase.

 

[O C Diver]

O C Diver & JLD,

No, I was not using a buyer's broker. My reasons are multifold starting with the fact that I am like some here shopping at the lower end of the price scale, hunting a mid to late 70's Tiawanese trawler. By the time two brokers split the commission on an older lower priced boat there isn't much to go around. I try to respect any professional's time, effort and expenses. I simply wish they would respect my time, effort and expenses.

To me it seems like the old days of bying a used car. Do your research, set your price bracket, cruise the ads and lots. Then brace yourself and don't turn you back on the used car sales person of half a second.

I did try a buyer's broker several months ago. It didn't work out well.

I may be coming to the conclusion that the dream of finding a sub $100K boat is just that, a dream. In my opinon a boat is a toy. I will not purchase a toy with a loan. If I can't pay in full for purchase, taxes and issues that need to be resloved immediately I won't purchase.

I agree with you that in your price range it's unlikely that you will get a very enthusiastic buyer's broker.

My recommendation going forward would be to have a photo list for the listing broker. If you're buying an old trawler, pictures of windows, fuel tanks, engines and a few other items would be a requirement before getting on an airplane.

Secondly, you might consider a pre offer quick survey. It might be worth paying a surveyor $300 or $400 to offer a quick opinion (not a written survey) when you go to look at an out of town boat. Unfortunately, in your price range, it seems that most of the boats you will look at, will have some problems. Paying $300 or $400 for a professional opinion may be quite a bit cheaper than what you just went through.

Ted

 

[Portage_Bay]

One of the lessons learned is that I won't be shopping air plane distance away anymore. A day or two drive tops, if it can't be done in one day then take the camper.


I have asked for pics and detailed info every time, I've been at this a very long time, and not once had a fully honest and competent response.



Moving forward I will tell the broker that I will conduct my own pre-survey survey. I've been around boats a very long time and am reasonably competent with a moisture meter, sounding hammer and flashlight. If I am not allowed to to a pre-survey on my own I won't be seeing the boat.



I'm not seeking perfection, especially not cosmetic perfection. But when boat #1 this week needed:
- Complete new transom wood structure
- Complete new steering room forward bulkhead
- Nearly complete rebuild of the fore deck
- Over 80% of the house sides and cabin tops had delaminated and had high moisture content.


And, here's the kicker. Post survey the broker slipped up and let me know he knew about the transom and steering room bulkhead prior to marketing the boat! Prior to my offer! Therein lies the charge of dishonesty.



We haven't even started on the long list of smaller stuff that I expect to deal with on an older boat.


Boat #2 as I posted previously over the phone and in pics sounded and looked good. But not up close and personal.

 

[dhays]

Moving forward I will tell the broker that I will conduct my own pre-survey survey. I've been around boats a very long time and am reasonably competent with a moisture meter, sounding hammer and flashlight. If I am not allowed to to a pre-survey on my own I won't be seeing the boat.

I think this makes a lot of sense. It seems to me that any broker should be willing to show you the boat before you make an offer. As an experienced buyer, you would be able to spot a lot of potential problems. In the long run, it could save time for the broker as well. That generally would limit you to boats in the Salish Sea or Columbia as being conveniently located. At the same time, those would be the areas where it wouldn’t cost you a lot to move it back home.

I don’t have the experience to be able to do a good pre-offer survey. When I looked at my current boat before making an offer, I tried to look at it carefully, but I honestly had no idea what I was looking for.

 

[Portage_Bay]

I used to think I knew what I was looking for. And I do as far as systems, engines etc go. But almost all of my experience has been on steel or wood boats.


After this week I know a heck of a lot more about fiberglass. The surveyor was happy to show me some tips. That does NOT make me a surveyor, but it may well keep me from paying for a survey on a boat not worth the expense and time.


As for cheaper to get home that's not a concern unless it's many thousands of miles. I've been running boats up and down the west coast from Mx to Ak for years. Even then it might not be a problem if it's a trip I want to make.


Anyway, thank you all or letting me vent and rant. Yesterday's broker experience set me off. Now it's back to the search somewhat wiser.

 

[Seevee]

Wow, just wasted (g) my lunch hour reading this thread and a lot of interesting comments!

I could argue strongly a few principles of buying and selling:

As a BUYER, unless I hire a buyer's broker, I'm representing myself and it's my responsibility to do my due diligence prior to buying. However, I expect the seller and his broker to represent the boat fairly and honestly.

As a rule, I first need to find a motivated seller and really prefer to talk directly to him, and I usually do, regardless of the broker. I really try to come across as friendly, looking for information and serious and try to let him sell me the boat. So the FIRST step is breaking the ice with the seller. Get to know HIM first, not the boat. I've never had that fail in over 140 transactions. However, sometimes after talking I can tell we just won't get along, no point in continuing.

The next thing I need from the seller is a really good representation of what the boat is like. What's wrong with the boat, why is he selling (he may not tell me that), what his next boat is, etc. Then I want to discuss price and be sure we are in the ball park. I tell him that I want to see the boat, operate it (with him at the controls) and see everything work and I give him a list of what I want to see and tell him it will take xxx hours to do so. I'll pay for everything. His time, his captain and his consumables. Surprisingly thats rarely been the case. I tell him that any undisclosed issues will be reason to adjust the price.

My goal is to make ONE trip to buy a boat, which is hard to do, but can happen. However, I'd need a surveyor standing by as well as a mechanic. When I look at the boat, I'll firm up an offer subject to a survey and/or mechanical evaluation. I would already have spoken to my surveyor and try to get it done asap. If the seller wanted a deposit, I would put one in escrow with my attorney or closing agent. If he didn't like that, I'd just tell him that I'd proceed with the survey and be there with fund in hand to close the deal after the surveyor finished that day.

The above has worked well for me for most of my transactions, boats, planes and real estate. I've RARElY put a deposit down with a broker, and have always seen the boat operate prior to an offer. Of the boats that I travel much of a distance to see, I have bought most of them.

Once I get into a pissing contest with a broker, I'll pass... just ain't worth it. Fortunately I find that rare. However, most brokers do a very poor job of selling boats.

========

As a SELLER.....

Anyone who wants to see my boat can, and I'll run it for them regardless. And I'll do everything I can to make them comfortable and SELL them the boat. I won't even talk deposit or contract until I've pretty much sold it to them. If they are not interested, that's fine, but I did my very best to sell them.

It's no wonder brokers have trouble selling boats, they spend too much time with contracts and deposits before they even "sell" the boat.

My philosophy is that you really never know the difference between a tire kicker and a real buyer. And most buyers start out as tire kickers. The seller's goal is to convert them.

I just sold my recent Sundancer this way. The buyer drove a bit of a distance. That's evidence alone that he's serious. He was a really nice guy, straight up and seems rather honest. So, I tried to bend over backwards to be sure he got all the info he needed, including a ride. The boat was in pristine condition, but an older boat, and priced right. This was the second guy that looked at it and he bought it. If I had to go through 10 people like this, it would have been well worth it.

Incidentally, I was talking with a broker to list it. He spend so much time dickering over a very complicated agreement that it sold before we ever got to first base.

 

[Seevee]

I also think you're blaming the wrong person. I suspect the owner had already told the broker plus I suspect your contingencies were unnecessary and excessive. You don't need to add contingencies on top of survey and sea trial. You can reject any boat you want to after survey or sea trial. You don't need to add anything else.

Now, you've also gone public which by doing so would mean if you made a side deal with the seller, you'd be liable in addition to the seller since you knew the broker was due a commission and you were aiding in circumventing. Oh, and I do know of a similar case in Washington where multiple parties lost in such a situation.

BandB,

I didn't know a buyer could be held liable for a commission by going direct to the seller. As a buyer, I have no obligation to the broker... in fact I tell them that up front and that I'll do my own due diligence. I have gone around them at times, but I tell the seller that THEY are responsible to their broker for what they agreed to, but I'll not participate in that. Never had an issue. And, no I don't hide that.... I simply explain to the broker that it might work better going direct and I'm not intending to screw them out of a commission. Yes, they bitch at times.

 

[Portage_Bay]

Seevee, I agree with your purchase process when dealing directly with the seller. My previous boat was purchased that way.

However when dealing with a broker they make up the rules. Most will not let you do anything more than a visual inspection prior to making an offer. I've not yet had one allow sea trials prior to offer. Most will try to prevent buyer from directly contacting seller.

As I've said my beef that caused me to revive this thread is with the broker withholding critical structural defect information. Information that had I known I would have politely declined to travel to see the boat let alone make an offer.

 

[Seevee]

Seevee, I agree with your purchase process when dealing directly with the seller. My previous boat was purchased that way.

However when dealing with a broker they make up the rules. Most will not let you do anything more than a visual inspection prior to making an offer. I've not yet had one allow sea trials prior to offer. Most will try to prevent buyer from directly contacting seller.

As I've said my beef that caused me to revive this thread is with the broker withholding critical structural defect information. Information that had I known I would have politely declined to travel to see the boat let alone make an offer.

Portage,

Good point, and you spent a lot of time and money because of misrepresentation... sorry to hear that.

I've been lucky with brokers and they have rarely enforced the deposit prior to sea trial, and have never demanded that it be in their account. I explain that from the beginning and if they don't agree, I'll go to plan B... which may be to contact the seller direct. At times, sure seems like they really don't want to sell boats!

I've had better deals with airplanes. One time when buying a pretty nice plane, after warming up to the seller, he said take the plane for a month and if you like it, send me a check, so I did and kept it in a spare hangar I had, and I later sent him a check.
Another one, I bought a plane in CA, never saw it, paid for in full prior to seeing it and turned out to be better that represented, with a few new radios that he never mentioned. It had run out engines, but still gave me 200 hours of flying before overhauling them. Only bought one boat unseen and was excellent. Kept that one for years.

 

[FoxtrotCharlie]

When purchasing our boat, with a buyers broker, we visited the boat first for a 'walk through', only with my buyers broker. Then we signed a contract, subject to survey and sea trials. My buyer's broker held my deposit. Sellers broker and seller had no problem with that. Survey and sea trial worked out, and we purchased the boat. Three hour drive from our home. Now since we have owned the boat for several months we have found a few items that I would take issue with re the survey. But we got it at a good price, and knowing it is a 30 yr old boat, we knew we would have to put money into upgrades. So far - new generator, new 3k inverter (survey did point out both of these were inoperable), repacking the stuffing boxes, new Capilano (sp) steering on upper station, and now new surrounds on the sundeck and fly bridge. A few boat bucks over what we planned, but not too bad

 

[Seevee]

When purchasing our boat, with a buyers broker, we visited the boat first for a 'walk through', only with my buyers broker. Then we signed a contract, subject to survey and sea trials. My buyer's broker held my deposit. Sellers broker and seller had no problem with that. Survey and sea trial worked out, and we purchased the boat. Three hour drive from our home. Now since we have owned the boat for several months we have found a few items that I would take issue with re the survey. But we got it at a good price, and knowing it is a 30 yr old boat, we knew we would have to put money into upgrades. So far - new generator, new 3k inverter (survey did point out both of these were inoperable), repacking the stuffing boxes, new Capilano (sp) steering on upper station, and now new surrounds on the sundeck and fly bridge. A few boat bucks over what we planned, but not too bad

Foxtrot,


Sounds like you did well. I always plan on putting money into a new boat purchase. Never fails, and often several boat units. (boat unit= $1000).