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  #21  
Old 09-11-2008
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Quote:
Originally Posted by wind_magic View Post
The buyer and seller are equals in the deal. What does the seller risk ?
I'm not going to argue with your logic. If you are the buyer it does seem like a bad deal on the surface.
I suspect that conventional process realizes that the buyer and seller are not really equal from a follow through perspective. The seller likely to get 200,000 is much more likely to go through with the deal than the buyer who has to part with 200,000. The day of the closing inevitably falls the day after the market took a tumble so the extra 20,000 skin in the game for the buyer is the nudge that is needed in real life.

Don't forget that you can negotiate your own deal. You see a boat you like just tell the broker/owner.
I'll sign a letter of intent but I'm not giving you 10%. Yes I know you will continue to show the boat. Can my surveyor come tomorrow at AM. They get to say yes or no.
They will show the boat anyway. The difference is that if you put down a deposit the broker will say "This boat is on deposit but look anyway just in case.". If you do not put down a deposit the broker will say: "Someone else is really interested in this boat but if you put a deposit down now you can beat them out of it"

It is not unusually in past years, not so much lately, that a buyer could possible have two people interested. The broker would tell them both: Look, sleep on it whatever you want, but first deposit gets the boat.
In this case it is really clear that once you put down a deposit the seller is loosing something, the other buyer. What happens if you put down the deposit but can't qualify for a loan? The seller or broker keeps your money.

In this market if you don't want to put down a deposit don't. Just be aware that when you are ready the boat may be gone.

Last edited by davidpm; 09-11-2008 at 08:15 PM.
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  #22  
Old 09-11-2008
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Let me try and put it a little simpler. When you sign a contract to purchase there is an couple of paragraphs on the front in bold writing. There are a couple of paragraphs on the back in not so bold writing. All of these are referred to as "legalese" that states th buyer and sellers writes. When you sign you are obligated to the contract.

I can understand your thought that it goes both way as it does with everything. There is always to sides to each argument. That is why there is standards of practice and laws for protection.

Because I am selling something and YOU are making an offer to purchase I the SELLER am considered the one at risk. It is YOUR responsibility to conduct a reasonable search for information to insure you are buying what is being presented and that it is a the good condition for the value being asked. Then that decision is yours to make.

Your recourse comes when I fail to live up to my agreement or in the event I misrepresent my product.

In short if you are uncertain of the product as presented or you sincerity in following through with the purchase then you should not offer to purchase by way of a contract.

You came to me I did not come to you. On the other hand if I had come to you the laws change in your favor.
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Old 09-11-2008
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Wind,

I think that DavidPm probably got this in the simplist words explaining it. You can argue what YOU think "logically" all day, but the game is usually not played your way. As David said, you can make your contract without a deposit and the seller may or may not go along with it. However, in my opinion that is when you the buyer become most at risk. You are putting money into all the expenses you have already discribed, and at any moment the boat that you now know is "perfect" can be bought out from under you!

The buyer and the seller both are risking assets in any agreement. They are just different assets.
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Old 09-11-2008
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Quote:
Originally Posted by tommyt View Post
You are putting money into all the expenses you have already discribed, and at any moment the boat that you now know is "perfect" can be bought out from under you!
I'm sure there are exceptions but I suspect that if you want out of a contract and want your deposit back many sellers and brokers will give it back in practice.

The negative karma is very high keeping a deposit. You are, however, at the mercy of the seller and have to be a convincing actor.
I will ask a broker I know who has sold thousands of boat how many deposits he has kept.

Last edited by davidpm; 09-11-2008 at 09:48 PM.
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Old 09-11-2008
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Quote:
Originally Posted by SailKing1 View Post
Let me try and put it a little simpler. When you sign a contract to purchase there is an couple of paragraphs on the front in bold writing. There are a couple of paragraphs on the back in not so bold writing. All of these are referred to as "legalese" that states th buyer and sellers writes. When you sign you are obligated to the contract.

I can understand your thought that it goes both way as it does with everything. There is always to sides to each argument. That is why there is standards of practice and laws for protection.

Because I am selling something and YOU are making an offer to purchase I the SELLER am considered the one at risk. It is YOUR responsibility to conduct a reasonable search for information to insure you are buying what is being presented and that it is a the good condition for the value being asked. Then that decision is yours to make.

Your recourse comes when I fail to live up to my agreement or in the event I misrepresent my product.

In short if you are uncertain of the product as presented or you sincerity in following through with the purchase then you should not offer to purchase by way of a contract.
I really do understand what you are saying, and I think you understand where I am coming from too.

Quote:
You came to me I did not come to you. On the other hand if I had come to you the laws change in your favor.
That's only true in part. The reason you didn't come to the person with the money is because if that person posted a message on the multiple listings saying "I have 'X' dollars for sale", then they would get a lot of boats coming their way to collect it, because all the boat owners are interested in the asset that the money has on offer. They wouldn't need to survey the money, or take it for a sea trial, and there is little chance that they wouldn't like it's lines, or the way it folds up and fits in their wallet, but it is an asset that they are interested in and they DID come to the market looking for it, because that's "where the money is". I'm confident if any buyer just posted a message saying they had "X" amount of money and wanted "a boat" that there would be plenty of boats being offered to the "seller" of the money.

So it's not that the buyer comes to the seller because the seller is special, or that the buyer is in some way indebted to the seller, it's simply because the seller's asset is much more illiquid than what the buyer has on offer. The buyer's asset is better in that regard, because every seller wants it, the only question is how much of it is on offer.
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Last edited by wind_magic; 09-11-2008 at 09:50 PM.
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  #26  
Old 09-11-2008
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Quote:
Originally Posted by tommyt View Post
As David said, you can make your contract without a deposit and the seller may or may not go along with it. However, in my opinion that is when you the buyer become most at risk. You are putting money into all the expenses you have already discribed, and at any moment the boat that you now know is "perfect" can be bought out from under you!
I'm not sure that's true, someone correct me if I am wrong - if the seller of the boat accepts the offer, whether there was earnest money involved or not, aren't they bound to see the deal through to completion from that point on ? It is a contract when the offer has been accepted, and the buyer isn't going to move forward with a survey and such things until the seller accepts the offer. I would think that the seller could be liable for the survey and other expenses in court if they were to break their side of the bargain after accepting the offer.

Edit, let me add a comment in here of thanks to everyone who has responded to this thread, it has been very educational. If I didn't respond directly to your comment rest assured that I did read it and appreciated it very much.
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Last edited by wind_magic; 09-11-2008 at 09:52 PM.
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Old 09-11-2008
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Quote:
Originally Posted by wind_magic View Post
I'm not sure that's true, someone correct me if I am wrong - if the seller of the boat accepts the offer, whether there was earnest money involved or not, aren't they bound to see the deal through to completion from that point on ? It is a contract when the offer has been accepted, and the buyer isn't going to move forward with a survey and such things until the seller accepts the offer. I would think that the seller could be liable for the survey and other expenses in court if they were to break their side of the bargain after accepting the offer.

Edit, let me add a comment in here of thanks to everyone who has responded to this thread, it has been very educational. If I didn't respond directly to your comment rest assured that I did read it and appreciated it very much.
Yes you are correct in the seller being bound to the contract. If the contract was written with the contingency of a survey at buyers expense (as it usually is) then the seller can not be held liable. On the other hand if the buyer has a survey and excepts it and the seller backs out then the seller could be held liable for the survey and other expenses.
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Old 09-11-2008
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Quote:
Originally Posted by wind_magic View Post
I'm not sure that's true, someone correct me if I am wrong - if the seller of the boat accepts the offer, whether there was earnest money involved or not, aren't the bound to see the deal through to completion from that point on ? It is a contract when the offer has been accepted, and the buyer isn't going to move forward with a survey and such things until the seller accepts the offer.
Again there is what is technically true and what happens in practice. If I call you on the phone and say I'll sell you my boat for 500,299.50 cents and you say OK I'll get a certified check Monday we have a contract, technically. Whether you can litigate it is another matter. If we both signed a written contract it is much more real. If I'm holding 50,000 of your money I suspect it is more real still.

I don't know what your business experience is but I suspect that over 99% of deals go through OK, deposit or no.

Quote:
Originally Posted by wind_magic View Post
It is a contract when the offer has been accepted, and the buyer isn't going to move forward with a survey and such things until the seller accepts the offer.
Everything is negotiable. If you will sign a contract but not make a deposit the seller can chose to:
1. Sign the contract and stop showing the boat.
2. Sign the contract and show the boat and take a chance that you sue.
3. Refuse to sign and allow you to survey
4. Refuse to sign and refuse you survey under the theory that you are a pain in the rumpus.
5. Several other more creative counter offers.

Everyone is free to make their own deal. If I knew that your surveyor was your 80 year old grandpa who surveyed fiberglass boat with an awl, I'd pick option 4.
Let me say it again.
Everything is negotiable.
You may ask for winter storage.
The dinghy
Financing from the seller for all or part
Take your boat in trade. (Surprisingly this has more appeal than it might seem. I'll take your 1980 Catalina in trade for 20,000 even though I know you paid 18,000 for it last year if you buy my 250,000 36' 2007 MK II. Now I've significantly reduced my financial exposure and I can dump your 1980 for 15,000 in days and all I lost was 5 grand and made you think you are better than the Donald. Any you only have to pay sales tax on the difference.
An upgrade (New Radar maybe)
A date with his daughter (Keep it clean just a date)
He sails the boat with you to its new home.

Everything is on the table. Once you get into it the deposit is just one very small option along with dozens of others.

Lets say you have a seatrial contingency. During the seatrial you say "THIS 27' BOAT IS SLOW IT ONLY GOES 10 KNOTS IN 12 KNOTS OF WIND I EXPECT 11". Did it pass the seatrial? Who decides?

Last edited by davidpm; 09-11-2008 at 10:26 PM.
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  #29  
Old 09-11-2008
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Quote:
Originally Posted by Davidpm View Post
I'm sure there are exceptions but I suspect that if you want out of a contract and want your deposit back many sellers and brokers will give it back in practice.

The negative karma is very high keeping a deposit. You are, however, at the mercy of the seller and have to be a convincing actor.
I will ask a broker I know who has sold thousands of boat how many deposits he has kept.
David you are correct in many will give it back but depending on the agreement between the seller and broker it may not be the brokers decision.

Many brokers will give a deposit back especially in todays INTERNET environment to keep a good name in their field. But, many are also going to keep it and even have an agreement with the seller that the deposit belongs to the broker in the event of the collapse of a sale.
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Old 09-11-2008
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Quote:
Originally Posted by davidpm View Post
Again there is what is technically true and what happens in practice. If I call you on the phone and say I'll sell you my boat for 500,299.50 cents and you say OK I'll get a certified check Monday we have a contract, technically. Whether you can litigate it is another matter. If we both signed a written contract it is much more real. If I'm holding 50,000 of your money I suspect it is more real still.I don't know what your business experience is but I suspect that over 99% of deals go through OK, deposit or no.



Everything is negotiable. If you will sign a contract but not make a deposit the seller can chose to:
1. Sign the contract and stop showing the boat.
2. Sign the contract and show the boat and take a chance that you sue.
3. Refuse to sign and allow you to survey
4. Refuse to sign and refuse you survey under the theory that you are a pain in the rumpus.
5. Several other more creative counter offers.

Everyone is free to make their own deal. If I knew that your surveyor was your 80 year old grandpa who surveyed fiberglass boat with an awl, I'd pick option 4.
Let me say it again.
Everything is negotiable.
You may ask for winter storage.
The dinghy
Financing from the seller for all or part
Take your boat in trade. (Surprisingly this has more appeal than it might seem. I'll take your 1980 Catalina in trade for 20,000 even though I know you paid 18,000 for it last year if you buy my 250,000 36' 2007 MK II. Now I've significantly reduced my financial exposure and I can dump your 1980 for 15,000 in days and all I lost was 5 grand and made you think you are better than the Donald. Any you only have to pay sales tax on the difference.
An upgrade (New Radar maybe)
A date with his daughter (Keep it clean just a date)
He sails the boat with you to its new home.

Everything is on the table. Once you get into it the deposit is just one very small option along with dozens of others.
It is common practice to get a deposit over the phone on a debit or charge card. If you have no cash deposit on the boat you have no contract in court. It's my word against yours type case.
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