Buying into a partnership, good idea?

[DubeJ]

I have 2 situations that I am interested in finding some experience in, since I am pretty much a newbie.

As a caveat, of course I know that some people are just shady, but that all said, for the sake of argument, lets all assume that these dudes are legit;

Situation 1: I found a guy online who is looking for 3 sailors to "rent out" his 36 ft Pearson for $150 a month. Each person would get 1 week, as in a time share. For the price, I am impressed and absolutely interested. But, I will never own the ship and just pay into it, which is good, as it is a $20k boat, and I could NOT afford it any time soon.

Situation 2: I found a guy who wants to purchase a boat, 22-30 ft and a total of $5-8k, and have a 50/50 partnership, where we split all costs, and share the boat. If one of us decides to bounce, then he can, but has to sell his share or both agree to sell. That all said, there is more of a commitment, but I will own this one (well half) but also half of the cost of everything.

I do not have a lot of money, but both of these I could pull off, just wondering what people think. Thanks.

J

[sailingdog]

Originally Posted by DubeJ

I have 2 situations that I am interested in finding some experience in, since I am pretty much a newbie.

As a caveat, of course I know that some people are just shady, but that all said, for the sake of argument, lets all assume that these dudes are legit;

Situation 1: I found a guy online who is looking for 3 sailors to "rent out" his 36 ft Pearson for $150 a month. Each person would get 1 week, as in a time share. For the price, I am impressed and absolutely interested. But, I will never own the ship and just pay into it, which is good, as it is a $20k boat, and I could NOT afford it any time soon.

This is likely not legitimate, since doing this legally would probably require that the owner have a USCG license and commercial insurance, which I doubt is the case. He would need the USCG license since he is effectively chartering his boat for $150 per week.

If you do decide to do this... I would highly recommend getting a written agreement or contract as to what the $150 per month is buying you, what your responsibilities are, and what his are, and things like who is responsible for repairs to the boat if it is damaged, if there is compensation for loss of use, etc.

Situation 2: I found a guy who wants to purchase a boat, 22-30 ft and a total of $5-8k, and have a 50/50 partnership, where we split all costs, and share the boat. If one of us decides to bounce, then he can, but has to sell his share or both agree to sell. That all said, there is more of a commitment, but I will own this one (well half) but also half of the cost of everything.

This is doable, and has been done, but you need to work out the details very carefully. Again, writing out very clearly who is responsible for the costs of repair or repairing the boat if the boat is damaged, whether the other person is compensated for loss of use if one partner damages the boat, etc., is the only way to make this workable, unless the person is someone you know well and trust completely.

Another problem is one of scheduling. How will you split holidays... like the Fourth of July and such.

Personally, I think there are a lot of headaches involved in partnering on a boat, especially if the person is an unknown quantity. Doing something like this works much better if it is someone you know well and trust completely, but that doesn't sound to be the case here.

Of the two, the second situation is a little better, in that you're only one of two people, instead of one of four and that you have equity in the boat.

I do not have a lot of money, but both of these I could pull off, just wondering what people think. Thanks.

J

There are quite a few other options available to you in most areas. Sailing clubs which allow members to use their boats for a yearly fee might be a better choice than either of the above arrangements. There's usually a greater selection of boats and fewer unknowns.

[sailingmum]

So... I'd go with the sailing clubs for starters. The other two scenarios seem like a recipe for disaster. At least there, you might have a chance to sail and get to know folks to eventually share a boat with. I was fortunate going 50/50 on a sloop many moons ago, but I knew the person well and had sailed with them many times. Even so, it could have gone south quickly in a business partnership.
Sailing clubs are great and I hope there's one near you.

[Mimsy]

I would never go into a boat owner partnership with anyone I wasn't prepared to marry!

I second the idea of a sailing club.

[Tempest]

I think the sailing clubs are a great way to go...you also get to meet other sailors and possibly learn from more experienced sailors.

I had a partnership years ago, but they were long time friends, and we sailed together more often than not. I'd be cautious entering into a partnership agreement with someone I didn't know. It could work, but It's needs to be a well written agreement.

I don't think a coast guard license is required to rent your boat unless the owner taking out passengers for hire. But I'd certainly want to know what the insurance coverage was..what your responsibilities were if something broke or somehow you damaged the boat. Is it month to month, or do you have to sign some longer term agreement? Is it exlusive use for the week?
Lots of questions to get answered here.

[DubeJ]

Wow, thanks for the replies everyone, and no insults towards me!
Well, the guy renting it out has sent me a pretty long contract stating what he is responsible for and what I am responsible for and a lot of things, pretty detailed like Sailingdog mentioned above. That said, does it mean it's good then?
My fears initially is that if I go with situation 2, and I do not know much about boat repair (I can wrench the hell outta motorcycles though ) and stuff goes wrong, which of course they will especially on a cheaper one, will I ever have enough to pay for repairs? That said the ship will just sit there and cost us slip fees.

As far as a sailing club, how does that work? I live in San Diego, so I am quite sure there are a few, is it expensive? I will look some up, but since it was mentioned, if some of you can please explain the benifits and how sailing clubs work, that would be great!!!
I am taking my Basic Keelboat Cert this month, and Basic Cruising as well, so I will have a little skill and a very little experience. I mean I have been sailing Cat 22's for a few years, but I know that I will be better sailor after these courses. (US Sailing)

[svHyLyte]

For the ake of the exercise, Google "Fractional Sailing". You may find that something like Go Sailing with SailTime Fractional Sailing - Sailing Clubs Redefined will suit you needs.

FWIW...

[rockDAWG]

FWIW, I signed on the fractional sailing this year. I am very happy with it and will sign for another year before getting my own toy.

[DubeJ]

thanks everyone.

[CatKid]

I was told 'a partnership is the only SHIP that doesn't float.'
I've stayed away from them. Do the club thing. EZR.
Cheers. CK