On Mon, 23 May 2011 20:55:19 -0700 (PDT), Hoges in WA
wrote:
I have two questions if anyone with experience in this can help.
1. Does the seller pay the broker's fee?
It depends. In most places in the U.S. it is customary
which is to say it is not always the case that the seller pays the
broker. But while apparently not intended, this is a kind of trick
question, and for several reasons.
The first is of course that you do not actually say that any
broker will be involved in the sale-purchase transaction by which you
acquire a boat.
Second and equally obviously, saying what is customary itself
presumes that when a broker is involved it has been the seller who
retained the broker and that it was that broker who primarily
facilitated the sale. However, there are boat sales and then there
are boat sales - that is, transactional differences ordinarily
correlated with the relative degree of complexity and of course also
with price. Eg. some especially Bigger Dollar transactions are
intermediated by multiple brokers, some retained by the seller and,
others, by the buyer. And while that you post to an internet
newsgroup might suggest you have not been advised by a professional
maybe because you have in mind a modest or even low price transaction
with only one broker, you also do not actually say. Which brings one
to these additional considerations:
Not to try to give you a hard time, but note that,
analytically viewed, your question is ambiguous and a matter mostly of
labeling. In other words, each of the buyer and the seller could
reasonably think about the transaction as one in which only the buyer
pays, at least in effect, since the buyer presumably is paying more in
a brokered transaction than she would if there was no broker so as to
provide to the seller whatever the seller considers to be acceptable
net proceeds of the sale, and, vice versa, an equally valid
rationalization could be that the seller pays, at least in effect,
since the seller receives a net sum less than if the seller had been
able without a broker to sell the boat for the same price or very
close to the same price as that realized by a broker mediated
transaction. If, if, if ....
In any event, the answer to the, Who pays? question is at
bottom a matter of negotiation even if ordinarily, too, of little
consequence for a low to modestly priced transaction. Eg. the impact
on sales tax could be less than modest or maybe negligible for such a
transaction whereas that consideration among some potential others
become more important the greater the number of $$ involved. Assuming,
of course, that the parties are meticulous about sales tax and related
considerations so that the price as stated on a bill of sale or other
transfer of title document fully reflects the actual price. However,
amazing as this might seem, sometimes and maybe even lots of times
there is not a fully accurate concurrence between what is said to have
been done and what actually was done..
In summary, the overall most important answer will be itself
essentially twofold. First and as already suggested, what for any
particular parties' transaction those parties agreed shall be the
answer. Second, it is prudent, sometimes even necessary in the
interest of self-preservation, while also maybe too often overlooked,
that the sale's documentation, whether by only a simple 1-page bill of
sale or by some sort of long form agreement like that used by
professional new boat dealers, identify who all and the only brokers
involved are, preferably state that that (or those) broker(s) were
paid, and also be drafted explicitly or at least with the effect of
imposing an indemnification of the other party provision if a broker
later makes a claim to the effect that she is entitled to a not yet
paid fee. And one also not uncommon way to achieve the latter effect
might be, for instance, to include on the sales document itself what
may be an only one line broker signed, "I was the only broker and I
have been fully paid" statement.
2. What sort of title check do I need to do to make sure it is clear
of encumbrances? i.e. whose services do I engage?
This is one sometimes prudent reason to retain a broker at
least if one assumes there is a written customer with broker agreement
that addresses these concerns. So this too will depend on the nature
including price of the transaction. Eg. will you be buying a boat
the seller had purchased new and with a bank or other commercial loan
that has not yet been satisfied and the status of which is
comparatively easy to verify? Is the boat a documented U.S. vessel
and, if so, what appears from the U.S. Cost Guard's databases which
are easily findable and searchable on line. Will you have checked
for UCC security interest filing statements where the boat was first
sold to the seller and where the seller resides and in whatever if any
other apparently relevant place there may be? Is there reason to be
satisfied that you can rely on what the seller tells you as truthful?
Is the nature of the boat and sales price sufficiently high that you
ought ask for and expect written representations about these matters
or sufficiently low, as you would define low to be, so that it makes
practical sense to you to be less thorough than if the nature of the
boat and price was substantially different? etc., etc.
3. If the boat is registered as a US vessel, and I am not a US
citizen, how long do I have to change this or who should I contact to
find out?
A reasonable time.
Look at
http://www.uscg.mil/hq/cg5/nvdc/nvdcfaq.asp which is
published on the U.S. Coast Guard's web site which publishes and also
links to other related information. And from that site:
If the vessel is new and has never been documented,
ownership may be established by submission of a Builder's
Certification (Form CG-1261), naming the applicant for
documentation as the person for whom the vessel was built
or to whom the vessel was first transferred. Also acceptable
are a transfer on a Manufacturer's Certificate of Origin,
a copy of the State Registration or Title, or foreign
registration showing that the applicant owns the vessel.
In the case of a previously owned vessel, the applicant
must present bills of sale, or other evidence showing
transfer of the vessel from the person who last documented,
titled, or registered the vessel, or to whom the vessel was
transferred on a Builder's Certification or Manufacturer's
Certificate of Origin. If title was transferred by some means
other than a bill of sale, contact the NVDC for assistance.
http://www.uscg.mil/hq/cg5/nvdc/nvdcfaq.asp#06
Forms -
http://www.uscg.mil/hq/cg5/nvdc/nvdcforms.asp
Thanks
Hoges in WA (who's actually in Nevada at the moment)