Buyer's Tips & The Boat Buying Process
All of the staff at Cabrillo Yacht Sales are licensed yacht and shipbrokers. We are experienced, bonded and state-licensed professionals who specialize in the business and we have instant access to boat owners and brokers through statewide, national and international networks.
STEP 2. FINDING THE BOAT YOU WANT TO BUY:
Start by contacting Cabrillo Yacht Sales, a licensed yacht and ship brokerage. We specialize in helping to find the right boat for you, and have extensive networks of listings to provide you with the most complete choice of boats.
An offer to purchase: After you decide on the boat you want to buy, your broker prepares an Offer to Purchase for your signature. You will make a good-faith deposit on the boat, usually 10 percent of the purchase price, which is placed into a bank trust fund that the licensed broker administers.
You control the deposit: By law, your money can not be spent without your written authorization and your offer to purchase is contingent on a satisfactory Sea Trial and Survey. Step 4 explains this in detail.
STEP 3. GETTING A BOAT LOAN AND MARINE INSURANCE:
Securing a loan is fairly simple if you have good credit history and can make a down payment, usually 20 percent of the boat's total delivery price. Consider pre-qualifying for a boat loan before you shop. It may give you some extra leverage and breathing room when you are negotiating a price. Cabrillo Yacht Sales, as part of its service, can coordinate financing and insurance for you.
Marine Insurance: The costs depends on several factors: How much boating experience you have, whether you have previous insurance claims, the kind of navigational equipment your boat has, where you will use the boat and the boat's value. You can expect to pay more for insurance on high performance or wooden boats or if you plan to live on board or go world cruising.
STEP 4. GETTING A SEA TRIAL AND SURVEY:
After the seller has accepted your offer on a boat and your financing is secured the seller will provide a demonstration sea trial to prove how the boat handles and performs in the water. Your sales person from Cabrillo Yacht Sales will go with you on the sea trial to answer any questions. Following an acceptable sea trial, the survey is your opportunity to determine if there are any unknown issues. Buyers pay to haul the boat out of the water and for the desired survey(s). If unforeseen problems become apparent during the survey, you might be able to negotiate their repair into a final price. Always use an independent surveyor, and always survey the boat in and out of the water. Marine surveyors inspect the boat in your interest and in the interest of your lender and insurance company. Often your lender will designate a marine surveyor, and Cabrillo Yacht Sales can provide you with a list of marine surveyors approved by lenders and marine insurance companies. You may also ask an independent marine mechanic to inspect the engine. We recommend you attend the survey to learn first hand the condition of the boat and to ask the surveyor any pertinent questions.
What to do with your sea trail and survey results: The biggest reason for the survey is to find out the current condition and the market value of the boat you want. If the results reveal flaws and problems, the sea trial and survey may give you the opportunity to back out of the contract without penalty - or to negotiate repairs on the boat. Your broker will usually give copies of the survey report to your lender and insurance carrier for review. Keep in mind, though - surveys are no guarantee against hidden or undetected defects.
STEP 5. SALES AGREEMENTS AND CONTRACTS:
The cardinal rule is - "Get it in writing"! Your Cabrillo Yacht Sales broker will outline the terms of the sale in writing to protect your interest. That includes spelling out the obligations that you and the seller agree to, and when these obligations will be fulfilled. It is a legally binding contract of each party's intentions.
Who Pays the Broker? The seller pays the commissions that a licensed broker earns - not the buyer. But that doesn't mean the broker works exclusively for the seller. Brokers have a legal duty to the buyer and seller alike in every transaction. Brokers work as trustees. They must work justly and in good conscience in the interest of both parties. They are duty bound to act in good faith, and they must make full and complete disclosures. One thing brokers can't do is guarantee the condition of the boats they are brokering. That is why a satisfactory sea trial and a survey by a competent and independent marine surveyor are so very important to you, the buyer.
What should you expect from a licensed broker? You should expect nothing less than complete honesty and the highest level of integrity from your broker. Cabrillo Yacht Sales prides itself on the integrity and honesty of its staff and works tirelessly to assure your complete satisfaction. The Department of Boating and Waterways conducts criminal background checks on all brokers and salespeople before they are licensed. Brokers must pass a three hour written exam and post a $15,000 bond before receiving their license. They must have knowledge of English, understand the principals of the boat brokerage profession - such as certificates of ownership, certificates of numbers, security agreements, bills of sale and other documents needed to register, number and transfer titles of boats. They must understand agency contracts, as well as listings and deposit requirements. They must have general knowledge of equipment legally required to be on boats and they must understand their legal and ethical obligation to buyers and sellers.
STEP 6. KNOW WHAT IT REALLY COSTS TO OWN A BOAT:
Be sure you have budgeted for costs such as: one-time fees, such as sales tax, and recurring fees such as storage costs, personal property tax, slip rental fees, maintenance and insurance. Cabrillo Yacht Sales can not advise you in tax issues. Consult you tax advisor for more information.
STEP 7. BE SAFE:
Know how to boat safely. The Department of Boating and Waterways will provide you with free boating safety information and a safe boating course booklet. The Department and CYBA recommend that boaters take safety classes from the U.S. Coast Guard and the U.S. Power Squadrons. To find classes near you call 1-800-869-SAIL or 1-800-336-BOAT. You may also consider taking private lessons aboard your boat.
STEP 8. NOW YOU OWN A BOAT:
What's Next? Cabrillo Yacht Sales will complete all closings to the contract, including disbursement of trust funds, title transfers, registrations and guidance to the buyer all the way to owning your new boat.
Please do not hesitate to call Cabrillo Yacht Sales at (619) 523-1745 for any addition information. You also may call The Department of Boating and Waterways at 1-888-326-2822 and CYBA at 1-800- 875-CYBA.
You have just completed your boating homework and you are now ready to put Cabrillo Yacht Sales to work for you. Call us today and we will begin the process.
Cabrillo Yacht Sales