What are broker's fees like - Page 2 - SailNet Community
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post #11 of 19 Old 04-05-2007
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contract clauses

Hello,

Some of the items in the contact that protected me are:

Included gear:
The sale includes the yacht and all equipment on board and in storage. This equipment will be available for the BUYER'S inspection / survey and will constitute the full inventory to be delivered with the YACHT at closing.

Regarding the survey:
The SELLER agrees to make the yacht and equipment available and ready to survey. The broker recommends that the BUYER employ the services of an accredited marine surveyor.

Acceptance of the yacht:
If the BUYER shall be deemed to have rejected the yacht, the deposit will be returned promptly.

SELLER CONFIRMS:
1. That he has full power and legal authority to execute and perform tis agreement and that he good and marketable title to the yacht.
2. That the yacht will be sold free and clear of any mortages, taxes, fees, lients, bills, encumbrances, or clames whatsoever, and that if any such obligation remains outstanding at the CLOSING, they will be paid from the proceeds of this sale.
3. That he will pay the BROKER at closing, a fee equal to 10 percent of the SELLING price, and authorizes the BROKER to deduct this fee from the DEPOSIT.

==

There is other such language in my first contact (don't have it handy) that specifies dates to be made, etc.

Barry

Barry Lenoble
Deep Blue C, 2002 C&C 110
Mt. Sinai, NY

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post #12 of 19 Old 06-10-2007
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broker sales contracts

If you are a buyer, remember that both brokers, the listing broker and "your" broker are getting paid by the seller. They are both technically "sellers' agents". They get paid by getting you to buy the boat. There are many honest brokers, they are just people, after all.

Many brokers use standard purchase/sale form contracts that are generally seller favorable. One of the really big things I've noticed is that the purchase and sale agreement says that the seller is making no warranties or representations. You have the right to, for instance, require the seller to state in writing that he is not aware of any material deficiencies in the boat, that he is not hiding or failing to disclose something important. This is an important concession to get from the seller, even if you have the boat surveyed. If might be hard to prove the seller knew something he didn't tell you, but you are a lot better off putting the seller on the spot before signing on the dotted line and making sure the contract language states that the sellers' warranty survives closing.

You have the right to add addendums and clauses for things that are important to you as a buyer, to move the deal away from a "caveat emptor" type of deal.

MH
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post #13 of 19 Old 06-10-2007
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Just to be picky, the broker works for...the broker! If they can screw somebody to their benefit, they will.
Take a sellers broker. You'd think they would want to get you the best price so they get the most out of their 10%. NOT. They want the quickest sale they can arrange. Dropping the price 20% costs them very little but can accelerate the sale. You get screwed.

As for rates, 'round here the rate is 10% with a minimum. I saw minimums from $1500 to $2500. This makes the situation even worse. Lets say you are selling a $15,000 boat. 10% is $1500. The broker may have a $2000 minimum so he won't care if the boat sells for $10,000 if you agree to the $2000 minimum. He then tries talking you into the lowest listing price he can sucker you into. He's guaranteed his $2000 no matter what.
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post #14 of 19 Old 06-11-2007
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Quote:
Originally Posted by xort
Just to be picky, the broker works for...the broker! If they can screw somebody to their benefit, they will.
Take a sellers broker. You'd think they would want to get you the best price so they get the most out of their 10%. NOT. They want the quickest sale they can arrange. Dropping the price 20% costs them very little but can accelerate the sale. You get screwed.

As for rates, 'round here the rate is 10% with a minimum. I saw minimums from $1500 to $2500. This makes the situation even worse. Lets say you are selling a $15,000 boat. 10% is $1500. The broker may have a $2000 minimum so he won't care if the boat sells for $10,000 if you agree to the $2000 minimum. He then tries talking you into the lowest listing price he can sucker you into. He's guaranteed his $2000 no matter what.
That may all be true, but no one holds a gun to your head to take the offer.
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post #15 of 19 Old 02-01-2012
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Brokers ALWAYS work for the channel from where the commission is coming from!! The 'standard contract' will include clauses to make both parties feel it is all fair and square, but there is no way the broker is looking after your interests if you are not paying him. That is why they get a Sales Commission or a brokerage fees; though they may like to present it to you as 'fees'. It is not fees, it is a commission they get, from the Seller, and the 'first 10%' may be paid to the Broker and the rest is sent to the Seller, if the arrangement says so. But please don't fool yourself into believing that the Broker is working for you. If there is anything that is outright wrong, the Broker will point out that piece to you, but the broker is not going to do more. He needs the sale to complete!! Therefore, it is natural, that, if you want to protect your interests, find your own broker and hire him at whatever fees/rate you are willing to pay (over and above the sale price, whether it is a direct sale, or sale through a seller's broker). For the right boat and right price, you'll be happy to have had a broker on your side! It is like getting the Boat Surveyor more interested in the transaction and actually working for you.
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post #16 of 19 Old 02-01-2012
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Quote:
Originally Posted by saurav16 View Post
if the owner of the boat uses a broker are they barred by a contract to make a deal with the buyer on their own? Which would save me and the broker a lot of money?
it depends... a central listing typically contractually obligates you to paying the broker. If it is open it is different.... 10% is idustry standard and comes out of the sell side. it works a lot like realestate... if a seperate buying broker meets a seller they split it. it is important to remember that there are (ie yachtworld-probably biggest in the game) will not let you list there as a FSBO.

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post #17 of 19 Old 02-01-2012
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Quote:
Originally Posted by Sailormann View Post
The broker gets a percentage of the final selling price - around here the standard is 10%. It is unconscionable that they actually earn money for the stunts they pull on innocent, unsuspecting newbies, and they are not shy about trying it on folks who have been around the block a time or two either.

Don't ever believe what a broker tells you until you have verified it yourself. Don't ever agree to anything verbally - have a written letter or an email covering every single detail - keep in mind that the bulk of them were fired from used car dealerships because of unethical behaviour...

Never, Never, Never use a surveyor that the broker "recommends".


Am I sounding a tad bitter here ???
there are bad apples i every industry. I have been licensed as a securiteis dealer for over 15 years, as a trader and dealing with the public as an advisor and have never been fined/sanctioned etc in any way during that time. While I helped people pay for kids college, retire early etc there were bad apples there too. Moving to brokering a different class of assest, I certainly feel that I am not coming from your 'usedsalescarguy' generalized depiction. I hold myself and my actions to the highest ethical standards, both professioally and personally.
I am sorry, as it appears you had a bad experience, but we dont crucify the whole of any industry due to some bad apples.

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Last edited by QuickMick; 02-01-2012 at 03:28 PM.
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post #18 of 19 Old 02-01-2012
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It's never a bad idea to "Get it in writing" No matter what kind of transaction you are making. Good for the buyer and seller alike.

Bob
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"Twenty years from now you will be more disappointed by the things that you didn't do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover."~Mark Twain
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post #19 of 19 Old 02-02-2012
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Everything is negotiable, including death and taxes.

Saurav, if you are buying a boat, don't worry about the broker. The seller signed a contract with them, that's not your concern. it is between the two of them.

If you sign a contract, that's something else again. Contracts, in theory, are negotiated between the signing parties and it is up to them to negotiate their own deal.
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