Buyer question - Earnest money - Page 2 - SailNet Community

   Search Sailnet:

 forums  store  


Quick Menu
Forums           
Articles          
Galleries        
Boat Reviews  
Classifieds     
Search SailNet 
Boat Search (new)

Shop the
SailNet Store
Anchor Locker
Boatbuilding & Repair
Charts
Clothing
Electrical
Electronics
Engine
Hatches and Portlights
Interior And Galley
Maintenance
Marine Electronics
Navigation
Other Items
Plumbing and Pumps
Rigging
Safety
Sailing Hardware
Trailer & Watersports
Clearance Items

Advertise Here






Go Back   SailNet Community > On Board > Boat Review and Purchase Forum
 Not a Member? 


Reply
 
LinkBack Thread Tools
  #11  
Old 09-11-2008
SailKing1's Avatar
Senior Member
 
Join Date: Feb 2002
Location: VIrginia Beach
Posts: 771
Thanks: 0
Thanked 0 Times in 0 Posts
Rep Power: 13
SailKing1 is on a distinguished road
The decision to return the deposit is based on the seller backing out for no reason other than change of mind. If you make an offer with intent to purchase with contingency's and all said contingency's are met and you back out, the deposit is forfeited period. This applies to boat, cars, RV's and houses. There is nothing you can do unless your state has laws to the contrary. I have seen few states that do.
Reply With Quote Quick reply to this message Share with Facebook
  #12  
Old 09-11-2008
Senior Member
 
Join Date: Jun 2006
Posts: 4,999
Thanks: 5
Thanked 18 Times in 18 Posts
Rep Power: 11
wind_magic has a spectacular aura about wind_magic has a spectacular aura about wind_magic has a spectacular aura about
Quote:
Originally Posted by SailKing1 View Post
The decision to return the deposit is based on the seller backing out for no reason other than change of mind. If you make an offer with intent to purchase with contingency's and all said contingency's are met and you back out, the deposit is forfeited period. This applies to boat, cars, RV's and houses. There is nothing you can do unless your state has laws to the contrary. I have seen few states that do.
Yes but isn't that a double standard ? It's a binding contract, both the buyer and seller are bound by it if the buyer accepts the vessel and agrees to the purchase. Both the buyer and the seller are obligated to make the transaction at that point - but the buyer has to put forth an at risk 10% (or whatever) deposit and the seller has to put down ... nothing ? As I said, the buyer is the one who is most at risk at that point - the buyer has paid for a survey, to haul the boat, etc, and has actual money invested in the deal, the seller has nothing invested in the deal. Yes, the seller loses a month of having his asset on the market, but the buyer also has an asset .. money .. tied up that he can't use for other purposes while the deal is being settled. If the seller backs out of the deal isn't the buyer the one out money ? Isn't it the buyer who is left holding the bag ? It almost seems like it should be the seller who puts up money to make sure the deal goes through to help cover the expense of the survey and hauling the boat in the event that the seller changes his mind and decides not to sell at the last minute. By paying for a survey, hauling the boat, etc, the buyer has proven his commitment to making the deal go through.
__________________
What are you pretending not to know ?

Please support my
To view links or images in signatures your post count must be 10 or greater. You currently have 0 posts.

Last edited by wind_magic; 09-11-2008 at 06:22 PM.
Reply With Quote Quick reply to this message Share with Facebook
  #13  
Old 09-11-2008
JohnRPollard's Avatar
Moderator
 
Join Date: Mar 2007
Location: Chesapeake
Posts: 5,680
Thanks: 0
Thanked 2 Times in 2 Posts
Rep Power: 10
JohnRPollard is a jewel in the rough JohnRPollard is a jewel in the rough JohnRPollard is a jewel in the rough
Quote:
Originally Posted by sailingfool View Post
A erroneous idea. As the broker usually manages the closing of the sale, he/she collects the fee as a check deducted right out of the proceeds of the sale, the buyer never gets the fee money and the broker doesn't need to worry about being paid later.
Not so with both boats I've purchased. In both instances, the earnest money deposit check for 10% was made out to the broker, and the balance was paid at settlement/closing in the form of a bank draft made out to the seller.
__________________

To view links or images in signatures your post count must be 10 or greater. You currently have 0 posts.

Pacific Seacraft Crealock 31 #62

NEVER CALLS CRUISINGDAD BACK....CAN"T TAKE THE ACCENT
Reply With Quote Quick reply to this message Share with Facebook
  #14  
Old 09-11-2008
AllThumbs's Avatar
midlife crisis member
 
Join Date: Jul 2008
Posts: 969
Thanks: 0
Thanked 10 Times in 8 Posts
Rep Power: 7
AllThumbs is on a distinguished road
When buying a used car, the buyer makes a deposit, then comes back to close the deal, and pays the balance. I have heard of instances where the seller gets a better offer after recieving the first deposit, and simply returns the first deposit to the first buyer and sometimes only informing the first buyer that he sold the car to another guy when the first buyer comes to pick up the car. I consider this unethical, but the buyer has no recourse here.

I agree with Wind Magic, the risk is all on the buyers side. To make it fair, both the buyer and the seller should make a deposit, to be held in trust by the broker.

Eric
__________________
I sail.
Reply With Quote Quick reply to this message Share with Facebook
  #15  
Old 09-11-2008
SailKing1's Avatar
Senior Member
 
Join Date: Feb 2002
Location: VIrginia Beach
Posts: 771
Thanks: 0
Thanked 0 Times in 0 Posts
Rep Power: 13
SailKing1 is on a distinguished road
Quote:
Originally Posted by wind_magic View Post
Yes but isn't that a double standard ? It's a binding contract, both the buyer and seller are bound by it if the buyer accepts the vessel and agrees to the purchase. Both the buyer and the seller are obligated to make the transaction at that point - but the buyer has to put forth an at risk 10% (or whatever) deposit and the seller has to put down ... nothing ? As I said, the buyer is the one who is most at risk at that point - the buyer has paid for a survey, to haul the boat, etc, and has actual money invested in the deal, the seller has nothing invested in the deal. Yes, the seller loses a month of having his asset on the market, but the buyer also has an asset .. money .. tied up that he can't use for other purposes while the deal is being settled. If the seller backs out of the deal isn't the buyer the one out money ? Isn't it the buyer who is left holding the bag ? It almost seems like it should be the seller who puts up money to make sure the deal goes through to help cover the expense of the survey and hauling the boat in the event that the seller changes his mind and decides not to sell at the last minute. By paying for a survey, hauling the boat, etc, the buyer has proven his commitment to making the deal go through.
Windy, I can understand some of your thoughts but the fact is when you put down a deposit with intent to purchase you are requiring the seller to take the product off the market. Yes you are compensating the seller for possible lost sales, but more over you are COMMITTING to BUY.

Example: I am a seller of boats (lets say a dealer) and you come in to buy my boat. You make an offer and deposit. Another buyer comes along and wants to buy the same boat. I have to turn him down because of your deposit. He buys elsewhere. You back out. I have lost a sale. Your deposit is the sacrafice you made.

I teach this and proper ways to handle it all the time. I also teach that you want to keep into account the name you may create for yourself depending on the circumstances. There are situations where you keep the deposit or return it. It's the sellers discretion.

If the seller does not live up to their end of the agreement, the deposit has to be returned.
Reply With Quote Quick reply to this message Share with Facebook
  #16  
Old 09-11-2008
SailKing1's Avatar
Senior Member
 
Join Date: Feb 2002
Location: VIrginia Beach
Posts: 771
Thanks: 0
Thanked 0 Times in 0 Posts
Rep Power: 13
SailKing1 is on a distinguished road
Quote:
Originally Posted by AllThumbs View Post
When buying a used car, the buyer makes a deposit, then comes back to close the deal, and pays the balance. I have heard of instances where the seller gets a better offer after recieving the first deposit, and simply returns the first deposit to the first buyer and sometimes only informing the first buyer that he sold the car to another guy when the first buyer comes to pick up the car. I consider this unethical, but the buyer has no recourse here.

I agree with Wind Magic, the risk is all on the buyers side. To make it fair, both the buyer and the seller should make a deposit, to be held in trust by the broker.

Eric
If there is a contract to purchase with a deposit and the used car dealer sells the car you have a lawsuit.
Reply With Quote Quick reply to this message Share with Facebook
  #17  
Old 09-11-2008
Senior Member
 
Join Date: Jun 2006
Posts: 4,999
Thanks: 5
Thanked 18 Times in 18 Posts
Rep Power: 11
wind_magic has a spectacular aura about wind_magic has a spectacular aura about wind_magic has a spectacular aura about
Let me say what you said back to you, slightly modified, so that you can see more what I was saying above ...

Quote:
Originally Posted by SailKing1 View Post
Windy, I can understand some of your thoughts but the fact is when you put down a deposit with intent to purchase you are requiring the seller to take the product off the market. Yes you are compensating the seller for possible lost sales, but more over you are COMMITTING to BUY.
As a buyer, I have an asset called "money" that I have to take off of the market. Maybe I had it invested in stocks, or maybe I had it loaned out to people in bonds, but now I have to take it out of the market and set it aside while negotiating this deal which results in lost revenue, etc, while I have my money sitting there doing nothing. Who is going to compensate me for lost sales i.e. lost interest revenue, lost possibilities to buy another boat, etc ?

Quote:
Example: I am a seller of boats (lets say a dealer) and you come in to buy my boat. You make an offer and deposit. Another buyer comes along and wants to buy the same boat. I have to turn him down because of your deposit. He buys elsewhere. You back out. I have lost a sale. Your deposit is the sacrafice you made.
I am a buyer of boats (lets call me the buyer) and I go in to buy your boat. I make an offer and we come to an agreement. While we are negotiating, another seller comes along and wants me to buy a different boat. I have to turn him down because we are in a deal. He sells elsewhere. You back out of the deal, and I have lost the opportunity to buy that other boat because I was screwing around with you.

Quote:
I teach this and proper ways to handle it all the time. I also teach that you want to keep into account the name you may create for yourself depending on the circumstances. There are situations where you keep the deposit or return it. It's the sellers discretion.

If the seller does not live up to their end of the agreement, the deposit has to be returned.
And if the seller does not live up to their end of the agreement it is the buyer who has now lost not only the revenue lost by having their asset (money) "off the market" while the deal goes through, but also the money invested in the survey, the hotel stays for the sea trial, travel expenses, money to haul the boat, and who knows what else ...
__________________
What are you pretending not to know ?

Please support my
To view links or images in signatures your post count must be 10 or greater. You currently have 0 posts.
Reply With Quote Quick reply to this message Share with Facebook
  #18  
Old 09-11-2008
Senior Member
 
Join Date: Jun 2001
Posts: 565
Thanks: 0
Thanked 2 Times in 2 Posts
Rep Power: 14
sailordave is on a distinguished road
In both real estate and boats... the SELLER is at risk by losing out on another potential sale. Yes, the buyer is most at risk but if the buyer backs out, the seller could have lost another buyer he had to turn down. Or maybe the house/boat was not available for inspection by another potential buyer b/c the first buyer had it tied up w/ survey/sea trial/etc.

As someone who has gotten jerked around by people that were kicking tires on the trailer, and foundations on the house... I say put up or shut up and take a walk!
Reply With Quote Quick reply to this message Share with Facebook
  #19  
Old 09-11-2008
AllThumbs's Avatar
midlife crisis member
 
Join Date: Jul 2008
Posts: 969
Thanks: 0
Thanked 10 Times in 8 Posts
Rep Power: 7
AllThumbs is on a distinguished road
Quote:
If there is a contract to purchase with a deposit and the used car dealer sells the car you have a lawsuit.

Maybe, but it still happens (more so with private deals than with dealers). In the same way if the buyer has made a contract with the seller what is the deposit for? The seller could just sue the buyer if the buyer backs out, which is what you suggest if it's the other way around.

Eric
__________________
I sail.

Last edited by AllThumbs; 09-11-2008 at 06:57 PM.
Reply With Quote Quick reply to this message Share with Facebook
  #20  
Old 09-11-2008
Senior Member
 
Join Date: Jun 2006
Posts: 4,999
Thanks: 5
Thanked 18 Times in 18 Posts
Rep Power: 11
wind_magic has a spectacular aura about wind_magic has a spectacular aura about wind_magic has a spectacular aura about
Quote:
Originally Posted by sailordave View Post
In both real estate and boats... the SELLER is at risk by losing out on another potential sale. Yes, the buyer is most at risk but if the buyer backs out, the seller could have lost another buyer he had to turn down. Or maybe the house/boat was not available for inspection by another potential buyer b/c the first buyer had it tied up w/ survey/sea trial/etc.

As someone who has gotten jerked around by people that were kicking tires on the trailer, and foundations on the house... I say put up or shut up and take a walk!
Everything you just said goes both ways. There was a post on another forum recently where the potential buyer was lured to a boat from a great distance only to have the boat sold out from under him when he got there, losing lots of money in the process. Sellers jerk people around too.

The buyer and seller are equals in the deal. Yes, the seller has an asset, a house, boat, or whatever, and the buyer has an asset, MONEY. They both bring equal amounts of value to the table, if they didn't the one on the losing side wouldn't go through with the deal. They are both parties to the contract, and they are both committed at a certain point to go through with the deal. They are both losing money by having their "asset" off the market. Yes, the seller might lose a sale because another buyer might come by, and the buyer might lose a potential buy because another seller came by and sold their asset while the buyer was tied up in this contract with you. It goes BOTH WAYS. More over, the seller has NOTHING invested in the deal, all he has to do is sign the paper and instantly know that he is going to make money one way or the other. The buyer on the other hand has not only the money spent on survey, hauling the boat, etc, on the line, but now also "earnest money" that can be lost if the deal doesn't go through. What does the seller risk ?
__________________
What are you pretending not to know ?

Please support my
To view links or images in signatures your post count must be 10 or greater. You currently have 0 posts.
Reply With Quote Quick reply to this message Share with Facebook
Reply

Quick Reply
Message:
Options

By choosing to post the reply above you agree to the rules you agreed to when joining Sailnet.
Click Here to view those rules.

Register Now

In order to be able to post messages on the SailNet Community forums, you must first register.
Please enter your desired user name, your email address and other required details in the form below.
Please note: After entering 3 characters a list of Usernames already in use will appear and the list will disappear once a valid Username is entered.
User Name:
Password
Please enter a password for your user account. Note that passwords are case-sensitive.
Password:
Confirm Password:
Email Address
Please enter a valid email address for yourself.
Email Address:

Log-in

Human Verification

In order to verify that you are a human and not a spam bot, please enter the answer into the following box below based on the instructions contained in the graphic.




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools

 
Posting Rules
You may post new threads
You may post replies
You may post attachments
You may edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On


Similar Threads
Thread Thread Starter Forum Replies Last Post
How much money? Cheetie Boat Review and Purchase Forum 9 02-25-2009 02:28 PM
Naive novice question re: buying a boat Conny Boat Review and Purchase Forum 12 07-21-2003 09:45 PM
Old question about spinnakers and racing turbo87 Racing 3 11-17-2002 11:31 AM
Perfect Storm...History channel Question JerryO39 General Discussion (sailing related) 7 02-04-2002 03:03 PM
Money Money seti668 Boat Review and Purchase Forum 2 09-12-2001 09:53 AM


All times are GMT -4. The time now is 09:45 AM.

Add to My Yahoo!         
Powered by vBulletin® Version 3.8.7
Copyright ©2000 - 2014, vBulletin Solutions, Inc.
SEO by vBSEO 3.6.1
(c) Marine.com LLC 2000-2012

The SailNet.com store is owned and operated by a company independent of the SailNet.com forum. You are now leaving the SailNet forum. Click OK to continue or Cancel to return to the SailNet forum.