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Old 05-28-2020, 10:01 AM   #1
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Purchase of trawler from private seller

Any consideration(s) to be aware of when out-of-state seller is offering vessel privately and not through a marine broker? Not my first rodeo, but never bought directly from an individual previously.
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Old 05-28-2020, 10:12 AM   #2
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I'm not sure that sellers, as a group, are less honest than brokers. Perhaps the opposite. When purchasing without a broker, you need to supply your own escrow solution, survey, and ensure proper title transfer - these are the services for which you are paying the 10% fee. If the boat is CG registered, this is easier. I bought my trawler from a buyer across the country, without a broker. I checked the CG title and we exchanged paperwork and a check simultaneously so no escrow was necessary.
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Old 05-28-2020, 10:24 AM   #3
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Follow your instincts.

I am surprised how many people get into trouble by just not listening to their inner voice. If it is too good to be true, it is likely just that. Something a little off with that guy, likely there is. It smells pretty strongly of diesel inside, likely has a leak. The first thing you should do is google the owner and the hull ID. You would be surprised how much you can learn with just a little typing. Maybe consider hiring a buyers broker in that area to represent your interests and use their contracts, search systems, and other important contacts for knowing what the boat is, or is not. For every good boat I worried too much about and walked away from there were ten that I was absolutely correct on. I spend a good bit of time looking for boats. Craigslist right now is LOADED with scammers and out of state BS. Use the sniff test at every turn. Do not be rushed, pushed, cornered, or given any kind of ultimatum. I used a broker to sell my last boat. This was a first for me as I have always prided myself on my selling and buying abilities. It was a great decision. It does not mean that you cannot get well screwed by a broker, but the chance of a full on scam is very remote. Good luck. If you have questions ask them here. This forum is loaded to the gills with experience.
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Old 05-28-2020, 12:36 PM   #4
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I'm not advocating you proceed without a broker, only relaying my buying experience without one.

I bought my boat from a private seller, several states away. The boat was a documented vessel with a dinghy that had never been registered anywhere. The sellers were as interested in protecting themselves from me as I was from them, and I had no reservations about them or their intentions. The owners told me up front that they had no desire or intent to correct any deficiencies discovered during the survey process, essentially declaring an "as is" sale, documented as such in the purchase agreement. I was fine with that, and it set the stage for the post-survey negotiations.

My initial offer included a 5% deposit which they held until the sale was final. I could have provided a larger deposit, but the seller agreed that the amount was sufficient. The risk of losing my deposit was low, limited to my acting in bad faith or not completing the sale as agreed to in the purchase agreement. The purchase agreement gave me ample opportunity to abandon the sale and recover my deposit.

I got to know the selling couple very well over the course of the sale, beginning with my initial look at the boat and through the offer, survey, after-survey negotiation, and funds transfer.The only significant complication to the sale was the dinghy registration which they promised to fix as a condition of the sale.

Because I was overwhelmed with all that had to be done in a short time, I hired a service to verify the owner's title to the boat and then transfer the documentation from the seller to me. Looking back, I could have done that and saved myself the cost which, in my opinion, was greater than it should have been. It did buy me peace of mind at the time, sometimes priceless. The seller did complete the dinghy registration process which took longer than the sale, but they kept me informed of their progress until the process was complete. I had 90 days to register both boats in my state without penalty, and the seller's paperwork was in order before the 90 days expired. There was some risk there, but the consequence was low.

It took me longer to arrange and transfer funding than expected, but I kept the seller informed and involved in the process, and they were comfortable and cooperative throughout. They had possession of the boat during the funds transfer process, so there was no risk to them. Ultimately, the funds transfer did not comply with the purchase agreement we'd both signed - I provided them with a certified check from the lender rather than a transfer of funds to the account they specified - but they didn't complain.

In all, the process from initial offer to vessel transfer was completed within ~6 weeks as originally agreed, though I was becoming concerned and was unsure I'd hold up my end of the agreement. I discussed this possibility with the sellers, and they agreed to extend the deadline a week or two, if required.

I'm sure I made many mistakes in the process, but I was comfortable in the offer and purchase agreements, and I was confident that I was appropriately protected by them. Had either party been dishonest, the effort to correct my mistakes could have gotten long, expensive, and ugly. Thankfully that didn't happen. moparharn's advice to be cautious and trust your gut is good, but dishonest people are often skilled at appearing as something else.

Don't let your love of the boat cloud your judgement, use offer and purchase agreements that protect you, and hire experts to dig into the condition of the boat and expose its faults. If you have doubts about your abilities to do that on your own, hire a GOOD broker (if the seller allows it) and pay the fee for the service and experience that should protect you but stay cautious. Not all brokers are equal.

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Old 05-28-2020, 01:59 PM   #5
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I have only purchased two boats, both through personal sales. In both instances I was lied to, in the first instance, I didn't know what I was doing and believed the guy. In the second instance I went in with eyes wide open and didn't believe almost anything the guy told me. And my instincts proved to be true.

In the second instance, I could spot obvious problems. "Does the boat leak?" I asked, knowing full well it did, obvious signs. "No" he replied, "not at all." This guy was a nuclear physicists from Ontario. Yes I did search out his credentials, found some research papers he had co-authored on the net.

This boat not only leaked from the usual suspects, like stanchion and window culprits but it had a design flaw I couldn't believe was original build. I only discovered this after the boat purchase. There were no scuppers in the cockpit and the water drained directly down the sides into the bilge. The only thing that slowed this process up was the soft bimini.

In fact some of the information he gave me - post sale - was down right wrong. I think this info was genuine misunderstandings about components on the boat not malicious intent.

So assume lies about the boat condition. And assume lies or misinformation about systems or equipment on the boat. For example, don't believe how much line and chain makes up the anchor rode, check it out yourself. Don't believe info on the secondary anchor and rode until you check it out yourself. Another one is don't believe fuel tank and holding tank capacity. Some forget then make up an answer they feel will keep you happy. And a nefarious lie some tell relates to the new auto batteries they bought and installed in their house bank just so they could tell you the batteries are brand new, this is a dangerous lie.

I like to ask folks selling things, I do this with retail sellers as well, a question in which I already know the answer too. If they don't answer honestly I now know something about them, I may still do business with them, but on critical info I might go to a second source before I completely believe them.

Create a question in which the guy pretty much has to say something negative, if he avoids answering, or ignores a glaring problem, a flashing light should start going off in your head. One question I will ask if the guy has owned the boat for a long time, "if you could go back to the builder, what would you ask him to redesign on your boat?" This is where research on your part pays off. You research and find that many who own a ..(fill in the blank).. wish their cockpit had been bigger. Or the walk way along the sides is too narrow, or their isn't a walkway on one side of their boat. Your real question to the guy isn't about how the boat is designed but more about his quality of character.

By the way, I bought the boat from the nuclear physicist, it had all the attributes I wanted in a boat, and allowed me into a marina that is very difficult to get into. I knew going in I was going to do a large refit to turn the boat into a thoroughly modern moderate distant cruiser. And the boat had decent bones, though with flaws that would have to be addressed, which I did.
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Old 05-28-2020, 02:52 PM   #6
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private seller purchase

Thank you each so much for your invaluable information. Gives me a great starting point to proceed. I'll let you know if the deal goes through and anything I can add to this type of purchase.
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Old 05-28-2020, 02:56 PM   #7
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In my opinion the 10% fee the SELLER is paying a listing broker (and therefore the paying that premium) is to market and show the vessel as well as manage the transaction. Many brokers will have less knowledge about a particular listing than the owner (seller). My last purchase was through a broker and I knew far more about the boat than he did.

If you go it without a broker:

1. Boat US has standard purchase and sale agreements you can use. There are others and an attorney can help craft specific conditions or language.

2. You should still have conditionals like financing, survey, engine survey, sea trial, etc.

3. Acceptance is entirely up to you based on the outcomes of the survey, sea trial, etc.

4. You can use a third party for escrow, liens, titling, documentation, taxes, etc. We used Pacific Maritime here in Seattle.

We sold our last boat without a broker. The buyer was a marina neighbor, knew us, knew the boat. I was honest with condition, refit, open issues and shared the last survey (two years old). We agreed on a fair price. He got an insurance survey (in water) and relied on the last hull survey for the rest. We sea trialed the boat twice (once as a joy ride when he expressed interest and again with the surveyor onboard).

Closed within a month, happy seller, happy buyer. I still support him to this day.

Not saying all transactions go well and some sellers have Bristol colored glasses but if it's not your first rodeo and you're protected within the agreement and get a proper survey and can save 5% - 10% off the top then why not?

After we closed on our current boat the previous owner and I had a few beers and lamented about the brokers and admitted to each other we would've been happier getting the deal done without them.
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Old 05-28-2020, 03:34 PM   #8
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I've never bought a boat through a broker, always private sales so I can't really compare the two. So far everything has worked out well. Sure, there were hidden problems as there is on any 30+ year old boat, but nothing that really surprised me too much.

With the current boat I used my surveyor as a witness for the sales documents, but mostly the sale was based on a handshake agreement and some hand written documentation. If I thought the former owner was a bit shifty, I would have arranged a more formal agreement.

Not a recommendation - just the way I roll.
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Old 05-28-2020, 05:18 PM   #9
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I think it matters a great deal what the selling/asking price is. Total different circumstances between a $15,000 boat and a $150,000 dollar boat.

But it is ALWAYS Buyer Beware

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Old 05-28-2020, 05:22 PM   #10
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I would find a marine escrow service and hire them to do the paper work for you. They will do the necessary leg work to make sure everything is on the up and up. You really don't need a broker at this point if you have already made a deal with the owner. He would just turn over the paper work to a escrow company.
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Old 05-29-2020, 05:11 AM   #11
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IF the boat is documented be sure to use the Coastyies web site to see if there are leans or charges against the vessel.


The USCG has a bill of sale you could use.
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Old 05-29-2020, 07:04 AM   #12
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I would find a marine escrow service and hire them to do the paper work for you. They will do the necessary leg work to make sure everything is on the up and up. You really don't need a broker at this point if you have already made a deal with the owner. He would just turn over the paper work to a escrow company.
I'm also negotiating a vessel from a private seller, who I was referred to by HIS broker from when he bought it a year ago. The broker has been helpful to me with information and seems solid.

I've been considering hiring that broker to assist in the sale and would offer to pay him 5% fee. The reason being that the purchase price is ridiculously low and I doubt the seller would want to shell out even a dollar.

So Russell's comment above rings true. I can protect myself with proper surveys and hiring the escrow company to do thorough checks, assure a clean title and handle the closing and deposit money.

However in this case the broker is extremely knowledgeable about the vessel, more so than the current owner who is an id...

Good thread. Tough decision. Going to inspect the boat again this weekend one final time.
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Old 05-29-2020, 04:05 PM   #13
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My biggest concern is transfer of funds. There is so much fraud out there.

A reputable escrow company combined with wire transfers of funds is a safer option.
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Old 05-29-2020, 04:54 PM   #14
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I sold my trawler to a fellow from Texas over a several day period from first phone call on a Wednesday afternoon until he sailed away with it the following Monday noon. I was as interested in seeing that it went to a good home as he was in having a good boat, and he still talks to me five years on. It was a 43-year old wooden boat which sold at the 60-plus K I was asking, so not a ton of money. He did have it surveyed, but there was no broker, no sales contract, and I handled the documentation paperwork while he got his insurance in order and money wired to me about an hour before sail away. I had spent the weekend with him teaching him how it handled, and rode with him for the first hours toward Texas hopping off on a bridge abutment when he was happy with all the navigation electronics. As I said, we still talk, amicably, and he is getting ready to truck it back to the Pacific coast from whence I trucked it east in 1990.
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Old 05-29-2020, 08:19 PM   #15
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One caveat. If you are buying a boat in Florida from an individual, and not using a Florida broker, the sales tax is due immediately on transfer of ownership. No 90 days to get out of the State.
Also look to see if your prpposed state of registration has a personal property tax, and, if you are going to do the loop before settling down, a knowledgeable broker or tax advisor may be able to reduce your overall costs.
Pay such person by the hour for their advice
and not a percentage.
Good luck.
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Old 05-30-2020, 06:26 PM   #16
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Here's is a start list....
See, run the boat
Settle price
Validate ownership and lien status boat and tender
Get surveyed do not skip this
Sea trial with surveyor
Revisit price or make repairs (owner)
(Finalize price,)
Get state sales agreement form modify it as needed.
(If USCG doc they have forms )
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Old 06-08-2020, 01:32 PM   #17
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Yachtclosers https://www.yachtcloser.com/

Will help you with private sales and escrow services

I used them on my private purchase and eveything went smoothly
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Old 06-08-2020, 01:42 PM   #18
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One caveat. If you are buying a boat in Florida from an individual, and not using a Florida broker, the sales tax is due immediately on transfer of ownership. No 90 days to get out of the State.
I didnít find that to be the case. I bought from an individual in February, and just registered the boat this past Saturday. Nobody at the tag office cared what the date of transfer was. Heck, they didnít even ask for a bill of sale. I handed them my USCG documentation, EPRIB registration, and driverís license, and that was it. In Florida, you get a discount on boat registration if you have a registered EPIRB.
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Old 06-08-2020, 04:07 PM   #19
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Services

As a licensed and bonded broker, I offer "a lacarte" services to clients and between private party buyers and sellers. The biggest usage is for escrow in the funds between buyer and seller. Having a reputable broker available to provide some services between buyer and seller gives both parties comfort and control over their transaction. They feel more secure than with a private party yet save money. I provide these services on an hourly basis; yes I make some extra money, but it mostly just helps folks out, especially on less expensive boats and for those that need just a bit of help.
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Old 06-09-2020, 09:47 AM   #20
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I have wasted a year trying to sell my boat thru brokers...virtual offices and no effort on their part...absolutely useless...do your due diligence as described above and possibly an escrow service but save your money !
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