Working with sellers who refuse a pending survey contract - SailNet Community
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post #1 of 40 Old 4 Weeks Ago Thread Starter
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Working with sellers who refuse a pending survey contract

Just wanted to see what others have done in this situation. A buddy of mine is looking at a GOB in SC and expressed interest in it. The seller refuses to do any sort of contract that protects him while he’s arranging a survey. Basically if someone walks up tomorrow with the right offer, boats sold, even if a surveyor is coming in the afternoon. Purchase price is in the $25k range and I told him an insurance co won’t touch it without a survey. It’s a classic like mine and they’re aren’t a whole bunch of them on the market. He said it’s in really nice shape and basically ready to go. I’ve bought plenty of boats without a PreP survey but then again I can recognize major issues..usually....and understand that going in I might have missed something and have to fix it. There’s always something to fix anyway so I look at it as taking over the projects from the previous owner. Boats use us until we’re spent and broke then move on to another skipper.

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Re: Working with sellers who refuse a pending survey contract

Your other option is if your buddy doesn't want to let it slip away is that he goes ahead and buys it and then has the insurance survey done after he owns it.
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Re: Working with sellers who refuse a pending survey contract

For me, personally, $25k is too much to spend without a survey. I would walk away. There are a lot of boats out there. I'm sure your friend can find one being sold by someone who understands that a survey is a normal part of the process.
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Re: Working with sellers who refuse a pending survey contract

Generally, Iíd tell the seller I was interested and to call me if he changes his mind. No hard feelings. Donít make him feel like his tail has to be between his legs to open up conversation again. Then go find another boat.


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Re: Working with sellers who refuse a pending survey contract

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Originally Posted by ApparitionS View Post
Just wanted to see what others have done in this situation. A buddy of mine is looking at a GOB in SC and expressed interest in it. The seller refuses to do any sort of contract that protects him while heís arranging a survey. Basically if someone walks up tomorrow with the right offer, boats sold, even if a surveyor is coming in the afternoon. Purchase price is in the $25k range and I told him an insurance co wonít touch it without a survey. Itís a classic like mine and theyíre arenít a whole bunch of them on the market. He said itís in really nice shape and basically ready to go. Iíve bought plenty of boats without a PreP survey but then again I can recognize major issues..usually....and understand that going in I might have missed something and have to fix it. Thereís always something to fix anyway so I look at it as taking over the projects from the previous owner. Boats use us until weíre spent and broke then move on to another skipper.

Suggestions?
Make a price offer subject to survey with a couple of "outs," just in case. An offer has to have consideration, so a check for $1,000.00 into someone's Trust Account is a good idea, or just give the guy $500.00 to hold it until you get back with survey. Time limit the survey and acceptance. Until something's in writing and signed, nobody has anything. I did it with my most recent, just because I wanted full protection of equitable title (by virtue of a purchase agreement). Legal title comes with bill of sale, registration and/or documentation (to the extent that legal title actually exists).
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Re: Working with sellers who refuse a pending survey contract

We did a survey the other day on a 1978' "classic". The fella had purchased it without a survey. Our survey revealed approximately $40k in immediately needed repairs before launching. He is devasted because he can't get insurance and repairs are about twice as much as he paid for the boat. Dock talk is he has now hired one of those "insurance surveyors" who never find anything wrong except for out of date fire extinguishers.

Ya pays yer money and takes yer chances
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Re: Working with sellers who refuse a pending survey contract

If he likes the boat, make an offer pending survey. If the seller won't do that, and he still wants the boat, hire a surveyor. Have the survey and then finish the deal. If someone else walks up, he might be out the cost of the survey. What I wouldn't do is buy it without a survey. A survey makes it so much easier to get insurance, and can save you a lot of money if the surveyor finds something expensive!!
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Re: Working with sellers who refuse a pending survey contract

It seems to me the seller has something to hide. He is trying to pressure the buyer into forgoing the survey. Unless it is the boat of his dreams and is a really good deal he should just walk away.

I suspect if he does get a survey it will reveal a serious problem. The seller probably already knows this and is trying to unload the boat to some sucker.

Or maybe I am just too cynical...

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Re: Working with sellers who refuse a pending survey contract

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Originally Posted by SchockT View Post
It seems to me the seller has something to hide. He is trying to pressure the buyer into forgoing the survey. Unless it is the boat of his dreams and is a really good deal he should just walk away.

I suspect if he does get a survey it will reveal a serious problem. The seller probably already knows this and is trying to unload the boat to some sucker.

Or maybe I am just too cynical...

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It's just as likely the seller has dealt with too many BS surveys that served no purpose but too leverage the seller on price.

Or maybe I am just too cynical...
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Re: Working with sellers who refuse a pending survey contract

My initial reaction from the cynical side of my brain is to suggest that you run, don't walk, away from this boat because my first impression is that either 1) the owner does not know boats and how they are bought and so cannot assure the buyer that there is nothing wrong with his boat, or 2)he knows something is wrong with the boat and he is concerned that a surveyor will find it.

But the kinder-gentler side of me thinks that there may be some legitimate reasons that a seller might be concerned with a survey such as the unnecessarily delay before going to closing with the boat off the market or worried that items found in the survey will be used to renegotiate the price. Oddly, I went through something like this on a boat that I was buying. The owner had specific concerns that focused on not wanting the boat off the market during the last of the season before winter set in, and the agreed upon price was his rock bottom price. To address those concerns, my offer that had a very strict time limits:
1 week to name a surveyor
1 week after that to go to survey
2 days to agree to proceed after the survey was complete
1 week after the survey to close
2 weeks after closing to get the boat out of his yard.

And the agreement specifically did not permit renegotiation of the price based on the survey, I could only agree to proceed or leave the deal and get my deposit back. It had a larger than usual deposit that was non-refundable 1)If a surveyor was named and a survey date was set and the boat did not actually go to survey, or 2)once the survey was accepted if the deal did not close. That was a very tight schedule and tough conditions, but we met it.

If those are too much time for this seller, you might set something up where the seller can bail out if he gets a better offer up until you name the surveyor, and a date and time is set for the survey, and that the buyer only has one week (or week and a half) to go to closing once the surveyor is named. That should take some of the risk out of it for the seller.

But if you can't negotiate a reasonable deal with the seller that allows a survey and retains the price for the period during which the survey is performed, then there is no way that i would buy the boat. I have bought a few pigs-in-a-poke and its too much of gamble when looking at a G.O.B. since the costs to make hidden repairs can be many times the value of the boat. There are almost no fiberglass boats that are so unique or rare as to be worth that kind of gamble.

Reading Viexile's comments above, if your friend wants the boat bad enough, maybe he can at least negotiate with the owner to agree that the owner will hold his price in exchange for a deposit and for allowing the buyer to have the boat surveyed. The offer might preclude accepting an offer to sell the boat to someone else for an equal price or lower price until the buyer can get the boat surveyed. That does not take the boat off the market, so the buyer still has the risk that the owner could accept an equal or higher price. At least in that case the seller would return the deposit if someone else bought the boat but your friend would be out the survey costs.

Jeff
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Last edited by Jeff_H; 4 Weeks Ago at 05:30 PM.
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