How to Work with Brokers When Looking at Trawlers

[Leatherneck]

Hi All! This is a great forum - filled with good information. I've done some searches online and found several trawlers offered for sale by brokerages and I'm planning a trip to look at them and narrow the field. They are offered by different brokerages. I was wondering if it is proper to just call each brokerage individually and set up a visit or if I need to work with one broker. I also have one trawler I'm considering that is being sold by a private owner so I don't want to enter into a commitment with a brokerage firm that would complicate the private deal if it occurs. Any suggestions how I should proceed? Thanks!
George

 

[twistedtree]

As a buyer, you have no commitment to any broker unless you decide to explicitly make one.


Some people know a trusted broker who they choose to use as a buyer's broker to help them work through the process. There can be lots of value in that if the broker is good. By having that broker make contact on your behalf for the boats of interest, your broker is subsequently entitled to split the commission with the selling broker. So your broker gets paid through the transaction.


That said, plenty of brokers will want to get their claws into you as a buyer so they can get that commission split. This is where contacting the sellers brokers on your own keeps anyone else from nosing in on the deal. If you have not brought your own broker to the deal, then the commission goes 100% to the seller's broker which they love. And it arguably gives you a bit more wiggle room to negotiate on price since the broker is getting all the commission vs half if there were another broker. But it may or may not help you. No way to know for sure going in, but it's a tool in your bag that you can use and otherwise wouldn't have.


I think want you don't want is to inadvertently end up with someone in the deal who you didn't invite and who isn't adding any value. I've seen plenty of brokers who add no value, and even some who seem to excel at screwing up deals. That's what you don't want, and if someone has latched on to you, you can invite them to leave. But you are also obligated, in my book, if they have legitimately brought you to a deal.


When it comes to making an offer, the contract that you put forward will typically name the brokers, so that's where the rubber meets the road.


Now I have seen a broker who was contacted about one boat, then get upset when you go look at another boat without them. Fork them. Just because you walked in their door about one deal doesn't entitle them to nose in on whatever other deal you might end up doing. This is where you need to clearly decide whether you want to work with them looking at other boats, or if you prefer to go look on your own.

 

[Leatherneck]

Thanks. This is what I suspected but thought it would be prudent to check. So I guess that looking at these brokerage offered boats would not have any conflict with a private offer from someone who has not listed their boat?

 

[DavidM]

How you proceed depends on how comfortable you are with dealing with multiple brokers over the phone, setting up visits, arranging for a survey, attending the survey and negotiating the deal. If you are comfortable then contact the selling broker, tell them you are interested in their boat and proceed.

If you are not comfortable with taking on the effort discussed above, or you are put off by the selling broker then find your own buyers broker. This isn't particularly easy and results in interviewing several brokers in your area to find one that is willing to help you particularly if your search leads you beyond his normal territory.

Then discuss these issues with your selected broker:

1. What happens if the selling broker won't split the commission 50/50. Do you both walk away. Do you pay him a fee for his services independently of the selling broker.

2. How does he participate in the sale. Just handling phone calls generally won't work. He needs to really work- maybe arrange for and attend the survey, maybe arrange financing and closing for the deal.

Most selling brokers will agree to a 50/50 split if the buyers broker does his share of the work.

I have done both and by my 3rd boat purchase, I did all of the work myself, contacting selling brokers and arranging visits. It worked pretty well for me.

As a broker in Annapolis for about a year, I had customers who depended on me for all of the buyers brokers duties including closing a complex deal in Florida, a state that seems to have more than its share of shady brokers, btw. But also a buyer who I showed several boats to, found a couple out of state that fit his needs, then discovered that he had gone directly to the out of state broker and bought one of those without me. Such is the life of a broker.

David

 

[firehoser75]

George,
Some good advice so far.

As common sense dictates, be fully aware that the sellers broker represents the seller and therefore, for all aspects of the deal, will (in theory) work to "sell" the boat. Your interest, needs, etc. are potentially not even on his/her radar!! Sometimes, it is very hard to get much info, help, or even get return phone calls from a listing broker.
However, as others have stated, there are a lot of "buyers brokers" who aren't adding much value to the deal, and maybe even just cause problems. If you decide that you will use a buyer's broker (I did and it worked very well for me), you need to spend some time researching several brokers. Ask for local recommendations, talk to other boaters for opinions, and go talk to them in their office, face to face. Prepare questions to help you determine how they (specifically) will work on your behalf, in your best interests, or would they "just want to get the commission". Some of this they will not answer directly, but you can often get a good feeling about it.
My buyer's broker did a lot of work for us, gathering information (especially when asked), showed us many boats (a few he just arranged visits for a first visit but did attend any we visited a second or more times). He gave valuable insight into the boat's condition, any specific info he had about that particular make/model, and after he really had a feel for what we were looking for, even told us a few times that he didn't think this one (we were then looking at) would be a good fit for us. He even freely gave advice and gathered information for us on a "potential deal" for us when the listing broker informed us he would not split commission. We did not have an explicit deal with our broker about this type of situation, so as far as he knew, he would not be paid, but he "worked" (without being directly involved) anyway. We did not buy that boat. When we did find the one, he travelled with us (3 hours away by car) for the viewing, then again for the survey and sea trial, where he again contributed valuable input. He recommended surveyors, documentation services, mechanics, etc. to help us complete the deal, and import the boat to Canada. Due to the fact that the boat was located in the US (LaConnor, Wa), on closing he drove us down to pick up the boat, so we didn't have to somehow arrange to get our vehicle home. When there, he drove us to various stores so we could provision (food, etc.), to West Marine for a couple of needed items, and to US Customs so we could obtain the needed "Cruising Permit" for bringing her home.
We felt that our broker provided great service and feel that he added greatly to our experience, and even helped us to avoid many potential problems.

Your money, your call,
Best of luck in your boat search, and enjoy the process,
Tom

 

[Comodave]

George,
Some good advice so far.

As common sense dictates, be fully aware that the sellers broker represents the seller and therefore, for all aspects of the deal, will (in theory) work to "sell" the boat. Your interest, needs, etc. are potentially not even on his/her radar!! Sometimes, it is very hard to get much info, help, or even get return phone calls from a listing broker.
However, as others have stated, there are a lot of "buyers brokers" who aren't adding much value to the deal, and maybe even just cause problems. If you decide that you will use a buyer's broker (I did and it worked very well for me), you need to spend some time researching several brokers. Ask for local recommendations, talk to other boaters for opinions, and go talk to them in their office, face to face. Prepare questions to help you determine how they (specifically) will work on your behalf, in your best interests, or would they "just want to get the commission". Some of this they will not answer directly, but you can often get a good feeling about it.
My buyer's broker did a lot of work for us, gathering information (especially when asked), showed us many boats (a few he just arranged visits for a first visit but did attend any we visited a second or more times). He gave valuable insight into the boat's condition, any specific info he had about that particular make/model, and after he really had a feel for what we were looking for, even told us a few times that he didn't think this one (we were then looking at) would be a good fit for us. He even freely gave advice and gathered information for us on a "potential deal" for us when the listing broker informed us he would not split commission. We did not have an explicit deal with our broker about this type of situation, so as far as he knew, he would not be paid, but he "worked" (without being directly involved) anyway. We did not buy that boat. When we did find the one, he travelled with us (3 hours away by car) for the viewing, then again for the survey and sea trial, where he again contributed valuable input. He recommended surveyors, documentation services, mechanics, etc. to help us complete the deal, and import the boat to Canada. Due to the fact that the boat was located in the US (LaConnor, Wa), on closing he drove us down to pick up the boat, so we didn't have to somehow arrange to get our vehicle home. When there, he drove us to various stores so we could provision (food, etc.), to West Marine for a couple of needed items, and to US Customs so we could obtain the needed "Cruising Permit" for bringing her home.
We felt that our broker provided great service and feel that he added greatly to our experience, and even helped us to avoid many potential problems.

Your money, your call,
Best of luck in your boat search, and enjoy the process,
Tom

Sounds like a great broker. They are few and far between. You should post his/her name if it is ok with the broker.

 

[tiltrider1]

If you know what you want and you feel a surveyor is only necessary to keep the insurance company happy then you will get little value from a buyer’s broker. However, for most people, a good buyer’s broker will be able to keep you from wasting your time on sub par boats or getting into unreasonable agreements.

 

[firehoser75]

Sounds like a great broker. They are few and far between. You should post his/her name if it is ok with the broker.

The broker I was talking about is Richard Hargreaves of Yacht Sales West in Vancouver, BC.

We liked working with him, especially as he has a "British style" sense of humour, and is a straight shooter who "calls em as he sees em" without being overly harsh or impolite (besides all of the other things in my previous post). We had also previously used him as our listing broker when we sold our previous boat several months earlier.
Point of disclosure, we only know him from our professional relationship involving our boat sales and the new purchase.
Regards,
Tom

 

[Comodave]

Well we all do a lot of complaining when someone does something wrong so when someone does a good job we should give them credit. That way others can use him and the bad brokers will hopefully get worked out of business.

 

[Slowasyougo]

Double agent

Normally the contracts deal with double agent representation. Historically brokers could represent both parties in a transaction but ultimately ended up representing them selves when put in that position.