What is the Buying Process? - SailNet Community
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post #1 of 5 Old 01-18-2014 Thread Starter
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What is the Buying Process?

Okay, I found the boat.
I want to make an offer to the owner, who is an individual, not a broker.
What exactly is the process?

To me, I make an offer... we negotiate and come to and agreement. What format is this done? A simple letter, or a formal document?

Then, We sign a pre-purchase agreement detailing the boat Hull#, equipment, etc. and stipulate that is contingent upon a clean survey. Is there a form for this? To me, it sounds like the owner will initially create this since it has a list of everything being sold with the boat. Is that correct?

The owner and I already talked about the time-frame they are dealing with and the timing of the survey. So, that should also be included.

I outlined a vague description of what I think happens. I'm looking for help putting the details in-place and correcting my initial impression.

...anyone?


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post #2 of 5 Old 01-18-2014
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Re: What is the Buying Process?

The simplest form of the offer is that you provide a cashier's check, the seller provides you with a signed over title, a simple bill of sale, and keys.

What you do beyond that is discretionary. Getting a survey beforehand is a good idea and the buyer is the one responsible for paying for that. You'll need the sellers approval to get the boat hauled out for the survey.

Paperwork listing all available items is a lot of work, but can be done. In my experience a more standard way of doing it is for the seller to say "everything on the boat is included except for XXX" where that might be a short list of personal items. When the deal is final and you go to buy the boat you check that the items that you cared about are still there.

I'm confused by your question compared to your signature. It sounds like you have a USCG Captain's license and already own a boat, but are still asking pretty basic questions about boat shopping.

I'm no longer participating on SailNet.
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Re: What is the Buying Process?

Yes, I have a captain's license. However, purchasing a boat is not a topic covered along with rules-of-the-road, fire fighting, or navigation.

I do own a boat, and followed your simplest method approach. This next boat is a more substantial boat purchase and should follow a some what more formal process for many reasons.

As I teach 8-9 year old children... most things you do in life are very simple... once you have done them, but the first time is usually scary.

It's best to understand the process up front, and then fewer errors will be made along the way... like buying charts of an unfamiliar harbor.


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Last edited by Columbia9_6; 01-18-2014 at 11:18 AM.
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post #4 of 5 Old 01-18-2014
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Re: What is the Buying Process?

http://www.jmins.com/marine/docs/vessel_bos.pdf

http://www.oceanmarinellc.com/broker...eAgreement.pdf

These are two examples of sales contract/bill of sale type templates available on line. If there's a delay in the process or deposit monies to be held I'd say some kind of escrow service would be wise.

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post #5 of 5 Old 01-18-2014
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Re: What is the Buying Process?

Here is the process:
  1. The seller decides that the potential for obtaining currency is greater than the value they are deriving from the boat, so they promote their intention to sell.
  2. You decide that you have access to some currency, and that you would derive a higher return by owing a boat than you currently are from the currency.
  3. You look at boats for sale, and the seller waits for you to find their boat. YachtWorld.com is a good starting point.
  4. You eventually find a boat that is priced near the amount of currency that you have access to, and you make an offer to either directly to the seller, or through a broker to the seller. This is called a Purchase and Sale Agreement. There are several available forms for this. Here is an example. If you work with a broker, they will furnish you with this form. You can also make up one your own.
    Your offer MUST include some form of "consideration" (aka a check) with your offer for it to become a contract. The agreement should also stipulate whether a survey will be preformed, and the estimated closing date of the transaction.
  5. The seller will either accept your offer, counter your offer, or be offended and not reply. If the latter takes place, the seller, or broker must return your consideration. (To avoid the latter scenario when I bought my boat, I did not make any offers on vessels that were less than 80% of asking price. I figured that if we were that far apart, we could not reach an agreement.)
  6. If you and the seller reach agreement, and the agreement contract stipulates it, you may have the boat surveyed, and/or sea trialed. If the boat is surveyed/sea trialed, and issues are detected with the vessel, you have the option of negotiating a concession, having the seller remedy the issues, or cancelling the contract, you are entitled to the return of your consideration, less any expenses incurred to enable you to preform the survey/sea-trial.
  7. If the boat passes the survey/sea trial to YOUR satisfaction, you then submit an Acceptance Agreement, along with the remainder of the negotiated purchase price. If there is something that you are still unsure about (for example; the engine over temperature alarm goes off during the sea trial, and it is discovered that the sea strainer is blocked, but you do not have time to re-do the sea trial), you can also submit a Conditional Acceptance Agreement, and have a neutral party hold a portion of the purchase price in escrow until the condition is met.

That's it in a nutshell....
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