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First time narrowboat purchase.


BeatTheSystem

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Hello, we have looked at a few boats and have found one that may suit our needs with a transferable mooring near to where we live. We will be using it for extended cruises when we both retire in a years time or so. Its a 1997 50' Colecraft.  I must admit that I don't know much about Narrowboats but I believe this is a good make. Although green with boats I am a competent electrical engineer with good mechanical skills so should be able to deal with most things.

 

We have arranged a survey which will happen next week. I am satisfied that the owner is who they say they are, they have disclosed that there is a mortgage against it. I asked more about this but didn't want to go into it until I am happy with the survey. I obviously want to ensure that the mortgage is paid off and it seems the best way to do that is to pay the finance company directly either the whole consideration or the outstanding mortgage and pay the vendor the balance. 

 

When it comes to the transaction I would like to present the vendor with a document to sign where they declare that they are fully transferring ownership over to me etc. Are there any examples someone could share with me please?

 

Thank you.

 

 

 

 

 

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15 minutes ago, BeatTheSystem said:

We have arranged a survey which will happen next week. I am satisfied that the owner is who they say they are, they have disclosed that there is a mortgage against it. I asked more about this but didn't want to go into it until I am happy with the survey. I obviously want to ensure that the mortgage is paid off and it seems the best way to do that is to pay the finance company directly either the whole consideration or the outstanding mortgage and pay the vendor the balance. 

 

 

As I understand the law - the seller is not the owner and cannot sell it. The owner is the finace company and it is with them that you must deal and pay. They will then give the seller any payment above what he owes (and any early settlement charges)

 

If you pay the seller, then you are rceeiving stolen goods' and the finance company are within their rights to come and sieze the boat from you, you will then have lost your money and the boat.

 

DO YOUR OWN RESEARCH.

 

15 minutes ago, BeatTheSystem said:

When it comes to the transaction I would like to present the vendor with a document to sign where they declare that they are fully transferring ownership over to me etc. Are there any examples someone could share with me please?

 

I imagine the owner (the finance company) will have their own contract of sale, but here are the standard RYA and Government (MCA) ones :

 

 

 

BILL OF SALE (RYA).pdf Bill Of Sale MCA.pdf

 

 

 

15 minutes ago, BeatTheSystem said:

Hello, we have looked at a few boats and have found one that may suit our needs with a transferable mooring

 

I would also check with the owner of the moorings, moorings are rarely 'easily transferable' but often advertised as being so.

Edited by Alan de Enfield
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30 minutes ago, BeatTheSystem said:

they have disclosed that there is a mortgage against it. I asked more about this but didn't want to go into it until I am happy with the survey.

You must sort this out before you part with any money. Indeed if the vendor can't satisfy you they have a right to sell the boat there is no point in committing not insignificant sums on a survey.

If the vendor is above board he should have no problem showing you the lender's paperwork. This will show how much has been borrowed, whether it is secured against the boat, how much paid back so far and how long the loan is for. It should also include clauses relating to what happens if the boat is to be sold before the loan is fully repaid. Ideally, you should also see something indicating the lender's consent for the boat to be sold.

 

That said, proper marine mortgages of narrowboats are rare. Much more common is a personal loan. In this case the loan is to the borrower directly who remains personally liable for the repayments, and the boat (or anything else the money is spent on) can be sold on without problems.

 

And just to add there is no formal register of boat's owner or keeper  (equivalent of the Land Registry or DVLA). So you need to see a paper trail of ownership documents from the vendor - contract of sale when he bought the boat, evidence that it has been licenced and insured in his name etc.

Edited by David Mack
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13 minutes ago, Alan de Enfield said:

 

 

As I understand the law - the seller is not the owner and cannot sell it. The owner is the finace company and it is with them that you must deal and pay. They will then give the seller any payment above what he owes (and any early settlement charges)

.

 

 

 

 

 

BILL OF SALE (RYA).pdf Bill Of Sale MCA.pdf 202.77 kB · 1 download

Eh? That can't be right. Were it so, no one would ever be allowed to sell a house on which they were still paying the mortgage. But they do.

 

 

 

I would also check with the owner of the moorings, moorings are rarely 'easily transferable' but often advertised as being so.

 

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13 minutes ago, Alan de Enfield said:

 

 

As I understand the law - the seller is not the owner and cannot sell it. The owner is the finace company and it is with them that you must deal and pay. They will then give the seller any payment above what he owes (and any early settlement charges)

 

If you pay the seller, then you are rceeiving stolen goods' and the finance company are within their rights to come and sieze the boat from you, you will then have lost your money and the boat.

 

DO YOUR OWN RESEARCH.

 

 

I imagine the owner (the finance company) will have their own contract of sale, but here are the standard RYA and Government (MCA) ones :

 

 

 

BILL OF SALE (RYA).pdf Bill Of Sale MCA.pdf 202.77 kB · 0 downloads

 

 

 

 

I would also check with the owner of the moorings, moorings are rarely 'easily transferable' but often advertised as being so.

Alan,

 

Thank you. Yes I understand, I will not be parting with a penny until either the mortgage is paid off prior or as part of the transaction with the finance company.

 

I don't yet know who the finance company is. With boats is there anywhere I can look to see if there is a charge registered against it? which in the case of a house this would be at the land registry.

 

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5 minutes ago, BeatTheSystem said:

 

I don't yet know who the finance company is. With boats is there anywhere I can look to see if there is a charge registered against it? which in the case of a house this would be at the land registry.

No. But a genuine seller should be prepared to tell you.

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As others have said you must get it clarified and see the  documents.  There is a bit of missing information and that is the price. Time and time again we see "bargain" boats that are no such thing. If this seems cheap then there is very good reason to be very wary. If you found it on Ebay, Faceache etc. be even more uneasy until you see the documents.

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10 minutes ago, BeatTheSystem said:

With boats is there anywhere I can look to see if there is a charge registered against it? which in the case of a house this would be at the land registry.

 

 

No there isn't. It really is the wild west as far as proving ownership is concerned. There are plenty of threads on here about how to go about it. Have a search.

 

On the up side, if there really is a marine mortgage on this boat it will have to be Lloyds Registered AIUI. You could look for it there and if it turns out not to be registered, the chances are the finance on this boat  is a personal loan not a mortgage. 

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1 minute ago, MtB said:

On the up side, if there really is a marine mortgage on this boat it will have to be Lloyds Registered AIUI. You could look for it there and if it turns out not to be registered, the chances are the finance on this boat  is a personal loan not a mortgage. 

 

It is not actually 'Lloyds Registered' but is the Govenement register run by the MCA and is called : "UK Ships Register - part 1" (UKSR)

 

Partv 3 is for registration of leisure vessels and is far simpler and does not cover 'proof of ownership or mortgage status'

 

 

Small ship registration (ukshipregister.co.uk)

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1 minute ago, Alan de Enfield said:

 

It is not actually 'Lloyds Registered' but is the Govenement register run by the MCA and is called : "UK Ships Register - part 1" (UKSR)

 

Partv 3 is for registration of leisure vessels and is far simpler and does not cover 'proof of ownership or mortgage status'

 

 

Small ship registration (ukshipregister.co.uk)

 

The thing is, identifying the vessel to the extent it makes acceptable security for a bank to use for a loan is pretty difficult, as Part 3 is obviously not appropriate.

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13 minutes ago, Tony Brooks said:

As others have said you must get it clarified and see the  documents.  There is a bit of missing information and that is the price. Time and time again we see "bargain" boats that are no such thing. If this seems cheap then there is very good reason to be very wary. If you found it on Ebay, Faceache etc. be even more uneasy until you see the documents.

 

I am keen to seek the opinion of the surveyor regarding price in 'todays' market. The price seems to vary widely it seems. I dont think this is a bargain by any means as it has not really had any updates over the years and the kitchen and bathroom's are very tired but has been looked after quite well within the present owners means but there is expenditure required to bring it to the standard we wish to enjoy for a long term family 'asset'. Probably we could get more for our money if we continue looking but that will always be the case.

 

Its circa 40K asking price. The original owner was a carpenter and has made a very nice job of the oak panelling throughout but the fixing and fittings although functional need updating, if I do it myself maybe 10K-15K, if I get 'professionals' to do it I suspect double or triple that.  I am still learning about the costs which seem to range from bodge to astronomical, and everyone has an opinion of 'you dont want to do it like that'!

 

I dont feel uneasy about the owner as they have been resident at the Marina for 7 years and everything feels right at the moment.

 

The previous survey about 8 years ago which was excellent so if its still as good then in our minds its worth the time and money to bring it up to scratch. 

 

Maybe I should have dug deeper about the mortgage situation before ordering the survey but I had to start somewhere. 

 

 

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27 minutes ago, MtB said:

 

No there isn't. It really is the wild west as far as proving ownership is concerned. There are plenty of threads on here about how to go about it. Have a search.

 

On the up side, if there really is a marine mortgage on this boat it will have to be Lloyds Registered AIUI. You could look for it there and if it turns out not to be registered, the chances are the finance on this boat  is a personal loan not a mortgage. 

 

Yes it definitely seems like the wild west. At the end of the day, what is ownership, its basically who has the biggest pitchfork. If the finance company owns it then the pitchfork is the law. If joe public owns a boat then its just on weight of evidence I guess. 

 

I will press the owner to see if it is a personal loan or mortgage. Hopefully its the former. 

 

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4 minutes ago, BeatTheSystem said:

I will press the owner to see if it is a personal loan or mortgage. Hopefully its the former. 

 

Yes that is quite an important fact to ascetain.

My replies were based on you saying the boat has a mortgage on it. If it is a personal loan and the boat is not security on the laon then that is a whole different kettle of fish'.

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40 minutes ago, BeatTheSystem said:

The previous survey about 8 years ago which was excellent so if its still as good

That tells you the boat was excellent 8 years ago. It is pretty worthless as a guide to current condition. Boats have gone from good to colander in much less than 8 years.

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1 minute ago, David Mack said:

That tells you the boat was excellent 8 years ago. It is pretty worthless as a guide to current condition. Boats have gone from good to colander in much less than 8 years.

 

Set against this is the fact such boats are outliers. Yes it happens occasionally but its very rare. Most boats seem to corrode and degrade pretty slowly. 

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1 minute ago, MtB said:

 

Set against this is the fact such boats are outliers. Yes it happens occasionally but its very rare. Most boats seem to corrode and degrade pretty slowly. 

Agreed. It tells you the boat is less likely to be a colander. But you would be taking a risk assuming it isn't. I see the OP has gone for a survey anyway, so that should give him a better idea.

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7 minutes ago, David Mack said:

Agreed. It tells you the boat is less likely to be a colander. But you would be taking a risk assuming it isn't. I see the OP has gone for a survey anyway, so that should give him a better idea.

 

Yes its a risk. My main concern is the OP seems to be trying to treat a boat purchase like a house purchase, and nail down all the risks to zero. It doesn't work like that with a box made of steel that goes rusty in water. Getting a survey is no protection as both Alan De E and I know from personal experience. A surveyor gives an opinion but if they didn't bother to look that hard, then hard cheese it was a waste of money, and worse. 

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Very unlikely to be a marine mortgage, quite likely owner does not understand the difference between a finance loan and a marine mortgage. 

In eight years he still owes money, seems odd, ask him to pay it off and you can progress with survey. 

As to valuation, throw a few prices in the air and see which comes up first. 

Surveyors are not going to be au fait with prices, why should they know the market? Its up to you to determine valuation, IMHO, then haggle or pay the asking price. 

Buying a boat is a risky purchase, as is any large purchase, upgrades can mean anything from a tin of magnolia to a strip back to bare shell and anything in between, this is not a house. 

Most jobs will take twice as long as you might expect and cost 2-4 times your costing. 

I don't think the current financing is any of your business from the lenders point of view, the lender is just not interested in you. 

What you want is a Bill of Sale see the RYA site. Unlikely thr vendor has one, but if he won't sell the boat free of encumbrances, I would walk away. 

If the owner wants to sell and he owes £4k, offer 4K less, that's my view, it's his problem not yours. 

You should ask to see his Bill of Sale, he will tell you he does not have one. 

Ask for the receipt he got when he bought the boat. 

There must be one if there is a loan related to the boat as any finance company would not give a mortgage willy nilly. You are entitled to ask to see the current statement of finance, he is entitled to refuse to show you. It may not be of value to you anyway. 

Is it his boat, how do you know, its up to him to provide evidence of ownership over eight years. 

As others have said 

IF

there is a loan secured on the boat, it is not his boat to sell, if he gets a few months behind, the boat is likely to be recovered by the finance company. 

Edited by LadyG
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10 minutes ago, LadyG said:

Surveyors are not going to be au fait with prices, why should they know the market? 

 

Because they do pre-purchase surveys on a lot of boats.  They also tend to know the asking prices, the agreed offered price and in many cases advise how much to reduce offers by.

 

 

13 minutes ago, LadyG said:

Most jobs will take twice as long as you might expect and cost 2-4 times your costing. 

 

Yep.  I always used to say boat jobs cost twice as much and take three times as long as you think.

 

Sadly materials prices have gone up a lot and availability has gone down so it might be three and four now.

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21 minutes ago, LadyG said:

 

Surveyors are not going to be au fait with prices, why should they know the market?

- Yes they are.

- Because it's part of their job. They don't just knock holes through hulls, you know.

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1 hour ago, Athy said:

- Yes they are.

- Because it's part of their job. They don't just knock holes through hulls, you know.

The highly qualified surveyor who gave my boat a pass for BSC couldn't even understand the basic requirements of a simple gas installation. He claimed he never saw most of the boat because he only saw what the owner showed him. 

The surveyor who recommended the purchase of Narrowboat Girl's is being pursued by her insurance. 

If they can't do these simple tasks, how can they determine a valuation, which is a figure plucked from the ether. 

I could take my boat to London and sit there till I got what I wanted, so the value of that boat to that purchaser is whatever I chose. A valuer may have a different figure, but its not necessarily the figure the vendor will sell at. 

I agree that their valuation should help the buyer in his decision, particularly to reduce price if some undeclared fault is found.

The trouble is that the buyer has already committed a large sum, plus time etc when he gets to that stage, so you'd think he'd already have a grasp of the market. 

Edited by LadyG
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1 hour ago, Tony Brooks said:

If that boat has been on shore power in the marina, which is likely, the without any galvanic protection it could go into holes within a year or so. So make sure it has either a working galvanic isolator or an isolation transformer

Thank you. I assume the transformer prevents current from flowing through the hull to ground. Is this not what anodes are for, to allow a sacrificial path?

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7 minutes ago, BeatTheSystem said:

Thank you. I assume the transformer prevents current from flowing through the hull to ground. Is this not what anodes are for, to allow a sacrificial path?

 

Not quite :

 

When in a marina the earth amongst all boats is common and can result in current flowing between boats and dissimilar metals. The Transformer isolates the earth cable so there is no circuit.

 

 

 

Galvanic Corrosion.gif

 

 

 

 

Edited by Alan de Enfield
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