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Buying through a broker


Clare De Loon
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As an add on to this, if you buy from a broker, is that an assurance or more importantly an insurance that the boat is <snip>

Certainly before the broker we used would even consider selling the boat we had to produce proof of ownership, a confirmatory e-mail from C&RT that the boat had been registered before and after the name change we made and agree that they could investigate if there was any outstanding debts against the boat.

 

The broker quotes what price they think will attract a buyer if this is about or a bit more than you think it is worth (& you will end up getting for it) you put it with them. They find a buyer he offers less than you are asking and you have to decide do you want to run with that price or wait for a buyer with more money.

 

The buyer and seller have to be pragmatic about things. There is a price where the buyer thinks they is paying a bit more than they should and the seller thinks they are selling for a bit less than they should, that's the market price. Everyone is happy (sort of) and the deal goes through.

No one has a gun held to their head, if you really don't like the deal on offer you have to move on.

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^ ^ this ^ ^

 

Good advice, except that all brokers are different. Some are gutter sharks who don't give a damn about whether the boat they are selling is legitimately owned by the seller. They'll do and say anything to lever money out of your pocket, and keep it out. Beware.

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Mike's right.

 

I went to one broker who claimed they could tell me nothing about the boat, it's history, it's owner, etc, - 'we have so many boats, we can't be expected to' was the excuse. Then they had no paperwork at all, no file on the boat even. until they began to realise they looked so stupid that they went to look - then suddenly there was lots of paperwork after all! Trouble was, it showed the owner was..... them! They'd bought the boat for resale and were passing it off as a brokerage boat (I guess the legal implications are different). Luckily, I had read about their shenanegins (probably on here) before I went to look at this one particular boat (sister to the one I bought elsewhere) so I was forearmed. Naturally, I walked, despite the boat itself.

 

I bought through ABNB (other brokers are available) and had nothing but a positive experience regarding the financial and admin aspects - refundable deposit, proof of ownership, handling of outstanding finance, client account, etc. I also had a sea trial without being committed. I say finance and admin because I think Caveat Emptor still applies when selecting your boat wherever you get it, whoever the broker, surveyor, or whatever. The risks just ratchet up to 11 if you start with a dodgy broker in the mix.

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We have a wealth of knowledge on this forum about most things watery and most of us are passionate about the waterways. The OP wants to join the community and needs some help (and probably re-assurance) that what they are doing or being asked to do is sensible. We have all had some difficult learning curves to climb on various issues and I would hope that they have come to the best place to receive that dispassionate and if need be - detailed help.

There are many horror stories (as with buying cars, houses, insurance etc) but they are generally not the norm. Most people buy a boat and find that there is the odd fault which needs fixing but with proper help from us the experience of getting on the cut can be less stressfull. Listing the difficulties and horrors is more likely to put off people than encourage them to join our community.

The OP needs to buy from a reputable broker who uses an escrow account to hold the deposit. They need to understand that it is their money and if they want to be shown the boat whilst underway is a prime requisite before they part with the deposit that should happen. They need to get the boat fully surveyed out of the water so the hull, anodes, sterngear etc can be checked by a reputable surveyor but cannot expect the seller to pay for that to happen If faults are found on survey they need to have a clear understanding of how much if anything the seller will contribute to correcting them and this will probably depend on how hard a deal they have struck with the seller. Providing the full survey is positive and whilst it is out of the water they might as well get a new BSS issued, the hull blacked and anodes replaced if necessary, with the owners permission.

 

Ed - thumbs

 

there is more but too late tonight

Edited by 5thHorseman
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all brokers are different. Some are gutter sharks .

I must remember not to step into a gutter round your way.

 

The only deal worth doing is one from which both sides come out smiling. If you (or the broker) can't achieve that, then it's time to look elsewhere.

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I would suggest you get confirmation in writing that the boat is owned by the seller and comes unencumbered by debt.

 

When was the boat built, is there confirmation of this (there should be). The broker should have or be able to get paperwork to back this up. Has it the appropriate certicates, has it got a current BSS, is it licenced and insured?

 

They should check the boat number (Jim Shead) and see if it has had a name change and then should search using it's name(s) on the net for any mention of it, blogs, news articles, comments on forums such as this etc.and match this with what the broker/seller is saying. ANY discrepancy found is a warning signal.

 

Who built the hull and who fitted it out, investigate their reputation and if there are any endemic faults, asking a question on here should get a response.

 

On inspection of the boat make a list and do not allow yourself to be hurried by the broker. eg water in the bilges, funny smells, new paint work, excessive smoke from engine, spaghetti wiring, damp/mold, obvious modifications etc.and ask for explanations. This can be used as a list of specifics you want checked out on survey if you are not altogether happy with the answers from the broker.

 

Is the boat tidy, does it look as if the owner cares for it. It might be old and a bit care worn but you can usually feel if it is and has been loved.

 

Take a deep breathe.

Is this the boat you want? Does it press your button?

Do you have somewhere to moor it when you have bought it?

No - walk away there are plenty more fish in the sea.

Yes - into battle on price.

 

Remember always it is your money and you control the situation until you part with it.

 

HTH - and the best of luck. I hope you come back here and tell us how you got on.

 

ed - typing errors only seem to show after posting

Edited by 5thHorseman
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I would suggest you get confirmation in writing that the boat is owned by the seller and comes unencumbered by debt.

 

 

Excellent advice you have given in several posts but I must pick up on this.

 

1) A letter from a broker (or seller) stating this is gonna be no help whatsoever if a finance company appears out of the woodwork claiming the boat has a loan outstanding against it and they intend to re-possess.

 

2) The good news is boats are only usually accepted by loan companies as security for a loan if they are Lloyds Registered*. Very few NBs are and I would imagine it is easy to check if one you are interested in is. Or isn't. If it isn't, then it won't have been accepted as security for a loan.

 

The seller may well have taken a loan to buy it but this is of no importance to you. Unless the boat has been Lloyds Registered and taken as security, the seller's loan will be by definition an unsecured personal loan and repaying it is no concern of yours. They certainly can't 're-possess' the boat if purchsed with an unsecured personal loan.

 

 

MtB

 

 

 

* True last time I checked, about a decade ago. But I doubt things have changed but happy to be corrected if wrong.

Edited by Mike the Boilerman
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The seller may well have taken a loan to buy it but this is of no importance to you. Unless the boat has been Lloyds Registered and taken as security, the seller's loan will be by definition an unsecured personal loan and repaying it is no concern of yours. They certainly can't 're-possess' the boat if purchsed with an unsecured personal loan.

 

 

MtB

 

 

 

* True last time I checked, about a decade ago. But I doubt things have changed but happy to be corrected if wrong.

 

MtB

When we sold our boat recently the broker required our permission for them to carry out a check for outstanding finance agreements (the precise words I cannot remember) on the boat before they would take it onto brokerage.

 

I agree with you that if the seller deliberately hides the information from you then a finance company may crawl out of the woodwork but I would would suggest it is worth asking the question as part of your due diligence. I certainly did on our latest boat and got an answer by return from the broker which suggested a professional approach (this also gives some comfort the deal is straight and leverage if it goes wrong)

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Excellent advice you have given in several posts but I must pick up on this.

 

1) A letter from a broker (or seller) stating this is gonna be no help whatsoever if a finance company appears out of the woodwork claiming the boat has a loan outstanding against it and they intend to re-possess.

 

2) The good news is boats are only usually accepted by loan companies as security for a loan if they are Lloyds Registered*. Very few NBs are and I would imagine it is easy to check if one you are interested in is. Or isn't. If it isn't, then it won't have been accepted as security for a loan.

 

The seller may well have taken a loan to buy it but this is of no importance to you. Unless the boat has been Lloyds Registered and taken as security, the seller's loan will be by definition an unsecured personal loan and repaying it is no concern of yours. They certainly can't 're-possess' the boat if purchsed with an unsecured personal loan.

 

 

MtB

 

 

 

* True last time I checked, about a decade ago. But I doubt things have changed but happy to be corrected if wrong.

Are you sure?

 

Our boat isn't Lloyds Registered yet we managed to get finance against it easily.

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Are you sure?

 

Our boat isn't Lloyds Registered yet we managed to get finance against it easily.

 

So what do you mean by 'get finance against it', exactly?

 

If you mean you wrote 'boat purchase' on your unsecured personal loan application form then they can't repossess the boat if you default on the loan payments. If on the other hand they accepted the boat as security (usually meaning a hire purchase agreement not a personal loan) then the situation is more complex. the finance company buys the boat then hires it out to you until all the hire purchase payments have been made, then it becomes yours to sell. Which did you do?

 

MtB

 

MtB

When we sold our boat recently the broker required our permission for them to carry out a check for outstanding finance agreements (the precise words I cannot remember) on the boat before they would take it onto brokerage.

 

I agree with you that if the seller deliberately hides the information from you then a finance company may crawl out of the woodwork but I would would suggest it is worth asking the question as part of your due diligence. I certainly did on our latest boat and got an answer by return from the broker which suggested a professional approach (this also gives some comfort the deal is straight and leverage if it goes wrong)

 

 

I had overlooked the possibility of the boat being the subject of a hire purchase agreement. I have no idea how one checks for this.

 

MtB

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......... the finance company buys the boat then hires it out to you until all the hire purchase payments have been made, then it becomes yours to sell. Which did you do?

 

 

 

Would that not mean that as a 'hire boat' it would need a commercial BSS, licence and insurance ?

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What does "privately hired out" mean? The licence and BSS required relates to the use of the boat, not the way its financed.

 

In fact, lets get it straight - I'm not sure ANY finance firms offer what you call "hire purchase", there's a marine mortgage where a proportion of the boat is financed by a finance house AND they retain an interest in the asset, but the boat is run as a private boat. Marine mortgage is different to hire purchase.

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What does "privately hired out" mean? The licence and BSS required relates to the use of the boat, not the way its financed.

 

In fact, lets get it straight - I'm not sure ANY finance firms offer what you call "hire purchase", there's a marine mortgage where a proportion of the boat is financed by a finance house AND they retain an interest in the asset, but the boat is run as a private boat. Marine mortgage is different to hire purchase.

 

 

I disagree. I think the financial relationship between the owner and the person using it 'privately' makes a difference. If the owner has hired it to the owner, commercial BSS and insurance are required.

 

MtB

In fact, lets get it straight - I'm not sure ANY finance firms offer what you call "hire purchase", there's a marine mortgage where a proportion of the boat is financed by a finance house AND they retain an interest in the asset, but the boat is run as a private boat. Marine mortgage is different to hire purchase.

 

 

I agree.

 

But the fact remains that hire-purchase is a legitimate way of financing the purchase of cars, sofas, boats, whatever. It may not be fashionable at the moment but it still exists.

 

 

MtB

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I bought through ABNB…couldn't have been easier and I only coughed up my hard earned brass after taking the boat out, asking loads of stupid questions, meeting up (several times) with the owner, boat builder, safety examiner and finally agreeing a price etc etc…the monies were then sent and held into a holding account under my name until the contract had been exchanged and at no time did I worry about the process; I assume all brokers operate in a similar way?

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I bought through ABNB…couldn't have been easier and I only coughed up my hard earned brass after taking the boat out, asking loads of stupid questions, meeting up (several times) with the owner, boat builder, safety examiner and finally agreeing a price etc etc…the monies were then sent and held into a holding account under my name until the contract had been exchanged and at no time did I worry about the process; I assume all brokers operate in a similar way?

 

 

Assumption is the mother of all cock-ups. Especially where boats are concerned!

 

 

MtB

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