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DCist 10-10-2007 02:34 PM

Boat Sale
 
Someone gave me 5k deposit on my boat until survey (week away). Can I still show the boat to other people before that time?

Thanks

TrueBlue 10-10-2007 02:39 PM

Yes, as a backup to the possibility the survey unveils some remorse with the prospective buyer - who may decide to rescind his offer, or if his financing falls through.

In all fairness though, you must inform subsequent lookers that the boat has a pending offer.

canadianseamonkey 10-10-2007 02:43 PM

Congrats. Good situation to be in and TB is correct.

Faster 10-10-2007 02:50 PM

Should be no problem showing the boat to others in the interim. But should you get another real interested buyer the current "buyer" certainly needs to have 1st right of refusal. It's possible they'll get into a bidding war, thought that is unusual.

TrueBlue 10-10-2007 03:00 PM

Additionally, if you are using a broker, make certain his contract allows a potential sale outside of his involvement. Most would require payment of their agreed-upon % fee (or a co-broke) in that situation.

kwaltersmi 10-10-2007 03:01 PM

No! You should pull your boat and shrink wrap it in dark blue and then store it away in the back of a pole barn where no one will ever see it until the sale closes!

Seriously though, there's no problem at all letting other potential buyers see the boat until the sale is closed. It's still your boat. And it's always good to have a list of interested people to call if the sale falls through or if the original buyer lowers his offer based on the survey results.

DrB 10-10-2007 03:24 PM

Diasagree with others
 
If you have accepted a deposit and the offer, then you really shouldn't be showing the boat to other potential buyers until the person with the deposit either backs away from the deal or some goes amiss during the sea trial. If someone calls about the boat, you should tell them that you have taken a deposit on the boat from a buyer, take their name and number, and ask them if the deal falls through can you recontact them.

It's like buying a house, the seller accepts your offer and you put down a deposit until the home inspection. You stop looking because you have found the house, so you may have passed on other houses that meet your criteria. However, the seller shows it after they have accepted your offer and the person looking at the house says "I want it and will pay X dollars more than what your current offer is". If you were the seller, do you take the new offer? If so, you breach the contract and the buyer can sue. Another example, you see an add for a item in the paper that is a high dollar amount (car, TV, trip, etc.) and of limited quantity, but you can't get there before the sale or store closes. You call in and put a deposit on it until you can get in and fully inspect and pay for. You arrive only to find that the item was sold to a walk in customer. On the good side, you do get your deposit back.

Although Boat Purchase agreements are not as stringent as the buyer can basically walk at anytime without penalty, the principle is still the same. Ethically, I think it is wrong.

One more thing to consider. What if you show the boat to a another potential buyer, after accepting the deposit, and he/she breaks something on it while looking? Now the boat is different to the original buyer and they have every right to walk away. Then you've lost your buyer AND you have to fix the thing the "looker" broke.

DrB

kwaltersmi 10-10-2007 03:54 PM

DrB - Most of your example assume he's going to sell the boat to a new buyer out from under the first buyer. His question was whether or not he could SHOW the boat to another person, not whether he could accept a higher/better offer from another person.

The seller needs to protect his best interest and have back-up offers/buyers ready in case the original deal falls apart. I sell real estate for a living and this sort of thing happens all the time. As long as the seller/broker is upfront about the pending sale and accepts the risk of something getting broken during a showing, there is no reason the boat (or house) can't be shown during the pending period.

TrueBlue 10-10-2007 04:09 PM

Home and boat sales contracts have many similarities. During the process of purchasing my last home, we signed a P&S, but the broker still showed it to several others before the actual closing. The seller had six back-up offers - most at a higher offer than our accepted offer.

DrB 10-10-2007 04:15 PM

Interesting....
 
Kwaltersmi,

I learn something new everyday. From my real estate transactions, I always thought that once a tentative deal was made (offer/deposit accepted), the ability to show a house was heavily frowned upon. I know all sorts of things can happen (buyer can't get financing, buyer can't sell exisiting property, etc.) but that usually is stipulated in the offer and the realtor and seller know this. I am surprised that even after an offer is accepted, a realtor still shows a property, even if the disclosure statement about it already having an accepted offer made.

I hope that I didn't imply that I think that the Seller, in this case the OP, should take his boat off the market. My only point was that he shouldn't actively show it. If someone is interested, the seller should take their info and say that an offer and deposit for the boat has been accepted, but if the deal falls through, he'll recontact them.

_____________________________________
EDITED: I saw both posts TB and Kwaltersmi and change my tune a little. If showing a piece of property after an offer/deposit has been accepted to other interested buyers is the norm for the real estate industry, I guess it is okay. I personally wouldn't do it.

DrB


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