Why Use a Broker to Help You Buy a Boat?

In simple terms, Yacht Brokers will work with you to find and purchase the boat that most suits your requirements. Traditionally, the boats' owner will pay the commission that a yacht broker earns at the completion of the sale - not the buyer. This means that you get the benefit of the brokers advice, guidance and legal skills without the associated cost. Brokers have a duty to both buyer and seller in every transaction. They are legally required to ensure that you receive the full and un-encumbered title to the boat you are purchasing.

The brokers role for the buyer

Most pre-owned boats advertised are either the "Central/Exclusive" agency listing of a yacht broker, or a trade-in from a new boat dealer. If it is a brokerage listing, the broker will have been selected by the vendor to exclusively represent his vessel and if it is a trade-in, the dealership will probably own the vessel outright. Either way, the person you speak with when you make your initial enquiry is likely to know the vessel inside and out.

You may end up initially contacting a large number of companies as you start your search. This will become less and less as you eventually whittle things down to just one boat, at which point the broker representing the owner will become your (and the owners) sole point of contact.

A more rewarding option might be to select a yacht broker of your own, then consult with him about your specific requirements in order to let him find you a boat. Brokers who are members of YachtWorld.com have access to powerful and exclusive tools that allow them to quickly research the market on your behalf, so that they can share listings with other brokers in the interests of finding you the most suitable one. Tell your broker what you need and let him do his job.

• The Initial Enquiry - A professional broker will listen closely to your wants and needs, then help determine if the boat you are calling about is the right boat for you. Before the call, you should view the full specification and complete photo library online, so your first conversation with the broker should be an objective one about the condition of the vessel. You should ask questions before deciding whether or not to spend your time going to see the boat. A good broker will help you determine if there are similar boats on (and off) the market, know the history of the yacht, how long it has been on the market and the reason why her owner wants to sell.
• Getting Finance and Marine Insurance - You may want to pre-qualify for a marine loan and/or insurance before you get in to the negotiations about the purchase of the boat. This will put you in a strong position when you are negotiating the terms of the purchase, so do your research first. Brokers often have access to finance and insurance offers that are not available to the public, so get their advice and a written quote. You should start with the finance and marine insurance pages on this website.
• Making an Offer on a Pre-Owned Boat - Anyone can look up asking prices on boats, but it takes a professional broker to have an intimate knowledge of current market conditions, a familiarity of similar boats and information on recent sale prices. The broker will have used these factors in advising the owner of a likely value, so use his experience to increase your chances of buying the boat you have just fallen in love with for a fair and reasonable price. The broker will discuss your offer and circumstances with the owner before coming back to you with an answer. This may involve you needing to change your offer, so work with the broker to make sure you get what you need out of the deal. If you and the owner can agree on the basic terms and what they are subject to, then the boat is now UNDER OFFER and you are halfway there!
• Buying a New Boat - Dealers offering trade-ins or new boats that they have in stock will inform you of tax issues or special warranty terms that may affect your purchase. Price negotiations over new boats are normally pretty quick, because you will be dealing direct with the owner of the boat. The dealer may be more flexible on the final purchase price if you were to be happy let him use it at a Boat Show, or for the occasional test sail with other potential clients. If the boat is yet to be built, then depending on whether she will be custom built, semi-custom or a production model, there is usually a basic cost, plus transportation expenses from the builder to the dealership and optional equipment and installation to be considered.
• Contracts and Timing - Once you have made an agreement to purchase, your broker will prepare a contract for your signature. Professional brokers and dealers are familiar with all the paperwork requirements for their country, from the initial "Offer to Purchase" and "Bill of Sale" to licensing and registration; or documentation and titling, to paying tax and other fees, as well as certificates of ownership, security agreements and other documents needed to complete a sale. In any event, the contract you sign will spell out the terms of the sale, including obligations that you and the vendor have agreed to and when these obligations will be fulfilled. You will be required to make a good-faith deposit on the boat, usually 10% and usually held in the brokers Client Account while the sea trial and/or survey are undertaken.
• Sea Trial and Survey - The buyer of a pre-owned vessel is entitled to request a sea trial and the services of a marine surveyor to inspect his chosen boat. Buyers pay for the survey and for hauling the boat out of the water in order that the surveyor can carry out his inspection. Once the report is produced, the broker will help you determine how to properly address the nearly-inevitable issues that are raised and put the problems in to context. Should there be any work required, the broker can help estimate the time and cost of correction, and point you in the right direction to obtain accurate quotes for the work required. Your lender and insurance carrier will often require a copy of the survey.
• The Art of Negotiating The Deal - The broker can use his position as a middleman to keep the negotiations between buyer and vendor moving to a successful conclusion. Should your surveyor find a 'significant defect' that suggests the boat may be unfit for the purpose you chose her for, there are four possible solutions:
  
  

  1. You reject the boat outright.

  
  

  2. You agree to complete the purchase once any serious defects have been repaired at the owners expense.

  
  

  3. You agree to complete the purchase with the boat as she is, but with a negotiation on the purchase price that reflects the cost involved in fixing any serious defects, which you would then undertake.

  
  

  4. You buy the boat as she is and sail off happily towards the sunset.
  
  One of the last two options are the ones are reached in almost every sale and purchase of a brokerage boat.

  
  
• Safeguard Funds - Professional brokers will understand maritime and admiralty liens for the type of vessels they represent, as well as deposit requirements and escrowed accounts to safeguard funds. A professional broker will use an escrow account for clients' funds, and ensure that at closing, any existing loan or other encumbrances are paid off. This safeguard is of critical importance to the buyer and seller, and can be a potentially serious hazard in a private transaction not involving a broker.
• Transfer of Title - the day that you become the owner of the boat is called the Completion Date. On this date, the broker must hold the full balance of the agreed sale price from you, in return for which you will be presented with the written proof that you are her owner. On the completion date, you will take full responsibility for the boat you have just purchased, including mooring, insurance, running costs and any current charter bookings.
• After the Sale - Your broker and dealer can help you source a wide variety of things you might need next, including mooring, maintenance/repair facilities or a charter broker. He can also advise on where you might learn about boat handling or seamanship and their experience in local waters can help you chart a course for great day, weekend or longer trips. They can connect you with boat clubs, races and rendezvous sponsored by builders and dealerships. You may have just made a new boating friend for life.