Finding the right boat
The early stages of buying a boat is not dissimilar to the early stages of buying a home in that you will probably look at a number of different types of vessels before deciding on one, and may want to negotiate on the price before coming to a final agreement with the vendor. Swale Brokerage will handle all negotiations between the purchaser and the vendor and help both parties through the legal process.
Agreement for sale and Survey
Once the price is agreed and the purchaser understands which items are to be included in the sale, (usually found in the inventory) the purchaser will advise us whether the agreement is subject to survey. Swale Brokerage will then prepare the ‘Agreement for Sale ’ documentation which will be sent to both vendor and purchaser for signatures. The vendor will be signing to the effect that he or she has the legal right to sell, and that the vessel if free of any encumbrances, charges or liens. The purchaser will be signing to confirm his or her intention to buy and will be asked to submit a 10% deposit. This deposit can be refundable if the contract is subject to survey and the survey report detects defects that are outside of what the purchaser has expected and seen. In this case the purchaser can either negotiate further through ourselves to renegotiate a lower price with the vendor, ask the vendor to undertake remedial work to rectify the defects or pull out of the contract altogether. The vendor of course has the right to reject any lower offer and return the boat to the market.
The purchaser would normally ask for 28 days to arrange the survey, although in agreement with the vendor this can be shortened if both parties want a quick transaction or lengthened if more time is required for a survey.
Costs involved in the Survey
Purchasers will normally want to take a boat that is afloat, out of the water for a full survey and any costs involved in this process are down to them. This will include the craning, cradling, chocking and any rental fees appropriate for the time ashore. The vendor will need to authorize consent for the boat movement, but all costs should be settled by the purchaser direct with the yard involved.
Completion of sale
The purchaser is required to pay the balance of the agreed price within 7 days of acceptance of the yacht, this being defined as one of the 4 options below:
- 21 days from the date of the Agreement for Sale document.
- 7 days after the date of completion of the inspection, survey or seatrial, whichever is the later.
- Upon notification in writing by the Seller or Swale Brokerage to the Purchaser of completion of the remedial works specified in any notice given by the Purchaser.
- Upon mutual agreement of a reduction in the purchase price
At this time the yachts papers will be handed over to the purchaser which would include:
- Part 1 Registry documentation if applicable (only if the vessel is Part 1 registered)
- Bill of Sale
- The original VAT invoice, or proof that it has been paid. (Not required for boats built before 31st December, 1984).
More information about the legal aspects of buying a secondhand yacht can be found on the RYA website www.rya.org.uk/