Help a Newbie with accepted offer!

[tanre]

Hello all. First, I’m excited because a preliminary offer has been accepted by the seller. Here are the details. I want to keep them a bit vague for now, so please forgive me if something is left out.

The purchase is outside of my country(US). Its in the EU. The owner has a broker. I do not, but am considering finding someone to look over the paperwork for a fee. The boat is in charter and is available after the season.

Here are the concerns/red flags I am getting:
During our conversation, the broker alluded to many higher offers a few months ago. I waited and then offered a small increase recently, which was accepted. When I asked if there was a survey done, the broker said no. I responded by asking, why, if so many other offers were given was there no survey? Did the others walk away after visually seeing the boat?,..my guess was he was lying the entire time, but my fear is that others had offered and walked away after a survey.

His reply was that the others(multiple) are waiting for the boat to come out of charter before they get a survey. I asked if the owner is allowing for more than one person to have a purchase contract on the boat…because other higher offers are pending AFTER the boat comes out of charter.

Since this is my first purchase, I’m a bit confused…do people normally wait until the boat is out of charter? Seems counter-intuitive. They would seriously limit themselves by not having a contract in place. Obviously a contract and then a survey soon follows…but what is the norm?

So, much more experienced sailors, Im asking for your opinions:

1) Is it normal practice to wait until a boat is out of charter before getting a survey
2) Can it be written into a contract that a survey will be performed AFTER the boat is out of charter with 1st right of refusal during interim
3) Do you all believe that the broker is blowing smoke (as I do)
4) Is there an inexpensive way to have a lawyer/broker/etc, look over my paperwork without acting as a buyers broker

[Sojourner]

Don't know most of the answers, but logic would say that if you're buying a boat that is still in charter, there is a chance things can still get pretty messy before it's handed over to you. I'd survey when the dust has settled and the boat is waiting for her new owner and no one else will be running around in it. BUT that might mean you'll miss out if someone else takes on the admittedly low but not zero risk that the last few charters are the ones to hard ground your boat

We bought ours here in the EU, it was a very informal thing. There was a broker who basically put me in touch with the seller, and we did everything ourselves. Survey done, handshake deal, then the contract was a short paragraph or two. But we also got very lucky so your mileage may vary.

[tomfl]

Originally Posted by tanre

Hello all. First, I’m excited because a preliminary offer has been accepted by the seller. Here are the details. I want to keep them a bit vague for now, so please forgive me if something is left out.

The purchase is outside of my country(US). Its in the EU. The owner has a broker. I do not, but am considering finding someone to look over the paperwork for a fee. The boat is in charter and is available after the season.

Here are the concerns/red flags I am getting:
During our conversation, the broker alluded to many higher offers a few months ago. I waited and then offered a small increase recently, which was accepted. When I asked if there was a survey done, the broker said no. I responded by asking, why, if so many other offers were given was there no survey? Did the others walk away after visually seeing the boat?,..my guess was he was lying the entire time, but my fear is that others had offered and walked away after a survey.

His reply was that the others(multiple) are waiting for the boat to come out of charter before they get a survey. I asked if the owner is allowing for more than one person to have a purchase contract on the boat…because other higher offers are pending AFTER the boat comes out of charter.

Since this is my first purchase, I’m a bit confused…do people normally wait until the boat is out of charter? Seems counter-intuitive. They would seriously limit themselves by not having a contract in place. Obviously a contract and then a survey soon follows…but what is the norm?

So, much more experienced sailors, Im asking for your opinions:

1) Is it normal practice to wait until a boat is out of charter before getting a survey
2) Can it be written into a contract that a survey will be performed AFTER the boat is out of charter with 1st right of refusal during interim
3) Do you all believe that the broker is blowing smoke (as I do)
4) Is there an inexpensive way to have a lawyer/broker/etc, look over my paperwork without acting as a buyers broker

Forget this mess and buy a boat in the US.

A second option is to fly to Europe or pay some one there to sort things out. Problem with this option is unless you want to take a vacation in Europe and have skills to assess the boat's condition it may cost big bucks.

As an aside there are plenty of boats in charter that will be up for sale as soon as they get out of charter (also plenty of non charter boats for sale). It is easy to say it is a buyers market. The thing is that a lot of the boats for sale have serious issues. Even if a charter boat is in good condition it still has a charter boat layout. This means cramming as many people as possible on a boat for a relatively short cruise; while an owners version normally has fewer but larger cabins. Charter boats are often abused by less than skillful captains and crews with resulting damage.

Not saying there are not good deals to be had. Rather that you have raised lots of flags about this deal; which is why I suggested you look elsewhere.

[CatNewBee]

Depends who is the broker. Large charter firms use their own brokers and are very reluctant to contract clauses by the buyer.

We bought ex charter, we had a look at the boat and placed an offer, counter offer, then settled given survey shows no major issues., surveyed one month later, some findings were fixed by the charter company, contract was the standard thing they use on all sales. We was also very nervous paying a lot of money upfront and not having anything tangeble. It took 2 month to get the paperwork done, by the broker, they got the money, cleared the bank and the ownership documentation (it was two person and a bank for the credit, one person was passed away in the meantime in the original title) then deregistered the vessel, with VAT notice payd, deregistered the VHF MMSI, and finally provided all needed papers for the new registration in our country. Never met the owner nor the broker, it was handled by the local staff of the charter company, communications by e-mail and only through the broker.

If it is a well known company, it will work probably flawlessly.

[Snore]

The seller sounds shady. I’d look elsewhere.

[LeeV]

Ditto on previous comments. My recommendation is that since you declared yourself a newbie, I’d first search for a reliable buyer’s broker and discuss your search (desired vessel, budget, etc...) with him or her.

Unless paying cash, find a finance/documentation source and get pre-qualified as you get close to making an offer.

You won’t pay the broker, and he/she has greater access to available boats.

Just my $.02

Good luck

[JimsCAL]

If you are in the US, why are you looking at boats in Europe? Looking to use it there?

[malbert73]

My guess is this is a catamaran. If so I think you need to remember there are really no “steals” in the catamaran market given high demand. So if you’re doing this because the price is low and you think you are getting a deal then there likely is a reason.
Like a beat up boat etc. have you actually seen the boat in person or just pictures?

[grantmc]

1) Is it normal practice to wait until a boat is out of charter before getting a survey?
I would expect this is normal. I certainly wouldn't be interested in wasting money surveying an ex charter till the vessel had completed its final charter. There could be all manner of damages incurred by even a weekend charter. Maintenance staff working in charter companies do amazing work between charters to ensure boats are fit for their next earner. There is considerable cannibalism between fleet boats including motors. Most happens the night before the boat is required.
As an aside you mention that there may have been other surveys and the broker has been guarded about them. Typically surveys are paid for, and as a result, owned by the prospective buyer. And they've no obligation to show the survey to the vendor or their agent.

2) Can it be written into a contract that a survey will be performed AFTER the boat is out of charter with 1st right of refusal during interim.
Of course, that is just a contract amendment and obviously agreed between both parties. This would be the norm for most prospective buyers.

3) Do you all believe that the broker is blowing smoke (as I do)?
Hard to say, but never forget the broker is working for the seller. And if you feel that the broker is full of lies then why are you still in negotiations?

4) Is there an inexpensive way to have a lawyer/broker/etc, look over my paperwork without acting as a buyers broker?
If you’ve a relative or friend who’s a lawyer and you think they’d do the work for free, why not.

OP you don’t say why you’re buying a boat overseas, nor what you’ll do with it once you buy it, nor where you live: and I don’t care. But you raise many concerns yourself in your narrative and sound ill equipped to complete an international transaction like this, so why not go with your own gut and RUN AWAY. There are thousands of boats out there.

[Stewie1]

Wait until it is out of charter.

[Luftmeer]

Search youtube for Nick O'Kelly. Good insight into negotiating and purchasing a charter catamaran. We've been looking for almost 2 years and always found "eyes" in foreign destinations before heading to look. Due to the complexity of importing into the USA (insurance, mortgage, and cost), we have now limited the search to the USA. Good luck.

[Calif.Ted]

First, I’m excited because a preliminary offer has been accepted by the seller.

I waited and then offered a small increase recently, which was accepted.

Does this mean you made a written offer to purchase subject to survey, what does preliminary mean ?
You don't gain anything by getting a survey while someone else is using it in the charter trade, you want to know the condition when it's done.

[CatNewBee]

If you made an binding offer and it is accepted, you have a contract, once you pay the deposit (usually 10% of the price, exactly matching the comission for the broker) the boat is yours given the survey did now show reason for renegotiations or rejecting the vessel.

You have then usually an agreed time frame for the survey at your expense and a week or two to rewiev the findings and pay, renegotiate or reject the boat. If you miss the timeline, you will loose the deposit and the seller or broker can look for a new contractor.

Read the contracts carefully!

[Sand crab]

You have an accepted offer so you are locked into the contract. Trying to bring in another broker or making other stipulations would be difficult. You can pay a broker out of your own pocket but I really don't see what this would accomplish. I would doubt that your binding sales agreement would allow others to offer higher bids which would bump you out unless you don't close. You do have an out based on acceptance at inspection and survey.

If this is one of the larger brokerages/charter companies then I would suspect that it would go somewhat smoothly. The big question is who is handling the escrow and closing, is that in house?

[malbert73]

This thread may be worth following

....And Then Reality Hits
http://www.cruisersforum.com/forums/...d.php?t=223096