Buying a boat in winter.
- Thread starter Brian Scott
- Start date
- Status
Escrow holdback
The broker is supposed to be the professional in this equation, certified and regulated in some states. An escrow holdback is a common concession requested by a buyer and optionally accepted by a seller. It allows a deal to close without waiting for spring, for example. By getting to close, the seller gets most of their money quickly; it protects the buyer from the seller accepting a better deal from someone else and it protects the seller from having his boat tied up off the market for a lengthy period of time. While title transfers at close, possession is really moot. If the new owner removes the boat for example, the selling broker would assume all contingincies cleared ane would release the escrow money. It is my understanding that no signature is required from the buyer, it is at the discretion of the selling broker. Anything can be written into a contract. I think the bottom line for the seller is whether they are confident in the quality of what they are selling and in the integrity of the buyer and any and all brokers involved, particularly the seller's own broker. I sold my C27 in December with a small holdback for the engine to be resolved at launch time in Spring. If I find my next boat soon I will walk away from the deal on any boat in the ice zone that doesn't either come with an escrow holdback or close at a very attractive price. I would guess that those most leary of escrow holdbacks would be buyers using the seller's broker and by owner seller's approached by a buyer's broker.
The broker is supposed to be the professional in this equation, certified and regulated in some states. An escrow holdback is a common concession requested by a buyer and optionally accepted by a seller. It allows a deal to close without waiting for spring, for example. By getting to close, the seller gets most of their money quickly; it protects the buyer from the seller accepting a better deal from someone else and it protects the seller from having his boat tied up off the market for a lengthy period of time. While title transfers at close, possession is really moot. If the new owner removes the boat for example, the selling broker would assume all contingincies cleared ane would release the escrow money. It is my understanding that no signature is required from the buyer, it is at the discretion of the selling broker. Anything can be written into a contract. I think the bottom line for the seller is whether they are confident in the quality of what they are selling and in the integrity of the buyer and any and all brokers involved, particularly the seller's own broker. I sold my C27 in December with a small holdback for the engine to be resolved at launch time in Spring. If I find my next boat soon I will walk away from the deal on any boat in the ice zone that doesn't either come with an escrow holdback or close at a very attractive price. I would guess that those most leary of escrow holdbacks would be buyers using the seller's broker and by owner seller's approached by a buyer's broker.
Thanks Phil ...
That summary clarifies a few issues (at least for me
) In summary, I was right that the title transfers in the winter at closing but it seems to me that the right of possession is the key to it. Now I see that the buyer is under pressure to conclude any outstanding issues that are related to the escrow amount before he takes possession because it is implied that he is accepting the release of money in escrow to the seller when he does take possession. So the buyer, even though he has title to the boat, won't be able to enjoy the use of it unless all unsettled issues are resolved, or, he simply pays the full amount and takes the boat "as is". The seller can't be too difficult either because he no longer owns the boat and if he wants the small escrow amount to be released he has to cooperate. Actually it now seems that the seller may have a little bit of the upper hand if there are significant issues that he doesn't want to pay for. As is always the case, a contract can never completely safeguard either party from trouble between buyer and seller, and there is no substitute for integrity.
That summary clarifies a few issues (at least for me
) In summary, I was right that the title transfers in the winter at closing but it seems to me that the right of possession is the key to it. Now I see that the buyer is under pressure to conclude any outstanding issues that are related to the escrow amount before he takes possession because it is implied that he is accepting the release of money in escrow to the seller when he does take possession. So the buyer, even though he has title to the boat, won't be able to enjoy the use of it unless all unsettled issues are resolved, or, he simply pays the full amount and takes the boat "as is". The seller can't be too difficult either because he no longer owns the boat and if he wants the small escrow amount to be released he has to cooperate. Actually it now seems that the seller may have a little bit of the upper hand if there are significant issues that he doesn't want to pay for. As is always the case, a contract can never completely safeguard either party from trouble between buyer and seller, and there is no substitute for integrity.Selling a boat
Ive sold several boats over the last 35 years some were in winter some in summer My feeling is this: The person thats buying the boat should know something about it. I dont believe in sea trials. Ive sold 3 boats. The buyer pays a small deposit than gets a survey. If hes happy he pays the rest of the money and takes title. It hes not he gets his deposit back. No escrow No sea trials period
Ive sold several boats over the last 35 years some were in winter some in summer My feeling is this: The person thats buying the boat should know something about it. I dont believe in sea trials. Ive sold 3 boats. The buyer pays a small deposit than gets a survey. If hes happy he pays the rest of the money and takes title. It hes not he gets his deposit back. No escrow No sea trials period
Sea Trials
I gotta question just how much can be learned from an afternoon sail aboard any boat. Yes, you can determine if the diesel works and listen to it, but when it comes to sailing the boat you really don't learn crap. You don't know about a boat until you sail it in a wide variety of conditions a number of times. A boat that seems difficult to manage in 30 kts, can become a joy in those conditions once one learns her characteristics - something that takes time. A typical test sail is probably going to be in moderate conditions. Taking a boat out in 15 kts tells you nothing. What boat sails crappy in those conditions? I think one is far better off talking to other owners, looking at specs, and reading articles than relying on an afternoon sail.
I gotta question just how much can be learned from an afternoon sail aboard any boat. Yes, you can determine if the diesel works and listen to it, but when it comes to sailing the boat you really don't learn crap. You don't know about a boat until you sail it in a wide variety of conditions a number of times. A boat that seems difficult to manage in 30 kts, can become a joy in those conditions once one learns her characteristics - something that takes time. A typical test sail is probably going to be in moderate conditions. Taking a boat out in 15 kts tells you nothing. What boat sails crappy in those conditions? I think one is far better off talking to other owners, looking at specs, and reading articles than relying on an afternoon sail.
I would never buy a boat...
...I hadn't sailed. I don't have half the faith in surveyors that I have in the contact between my hand and a tiller. Most of the time the boat speaks to me--almost every boat--of far ports, or close races, or perfect days in tradewinds where the helm balances on every point of sail. But every once in a while I steer a boat that just doesn't understand a simple request. I ask her to foot off an inch or two and she rounds up like a drunk at a kegger; I ask her to pinch a tiny bit more and she goes to irons like a preacher at a party. No thanks. If you want me to buy your boat, you're gonna have to let me sail her. And if you don't understand why I feel this way, well, you probably don't know enough about sailing to have cared for her properly in the first place.
...I hadn't sailed. I don't have half the faith in surveyors that I have in the contact between my hand and a tiller. Most of the time the boat speaks to me--almost every boat--of far ports, or close races, or perfect days in tradewinds where the helm balances on every point of sail. But every once in a while I steer a boat that just doesn't understand a simple request. I ask her to foot off an inch or two and she rounds up like a drunk at a kegger; I ask her to pinch a tiny bit more and she goes to irons like a preacher at a party. No thanks. If you want me to buy your boat, you're gonna have to let me sail her. And if you don't understand why I feel this way, well, you probably don't know enough about sailing to have cared for her properly in the first place.
What about a one off?
People who have a one off built cannot do sea trials. I wonder how many on the board have bought a boat w/o a sea trial. I bought 3 out of my 4 boats w/o a trial and was not at all surprised when the boat hit the water. I have chartered boats I thought were not good sailing boats, but this was not a surprise, either. The boat I presently own, a sea trial was important as I was suspicious of her light air performance. I did not trial her in heavy air as I was confident she would handle that fine, which she does.
People who have a one off built cannot do sea trials. I wonder how many on the board have bought a boat w/o a sea trial. I bought 3 out of my 4 boats w/o a trial and was not at all surprised when the boat hit the water. I have chartered boats I thought were not good sailing boats, but this was not a surprise, either. The boat I presently own, a sea trial was important as I was suspicious of her light air performance. I did not trial her in heavy air as I was confident she would handle that fine, which she does.
When I bought Bietzpadlin she hadn't been in the water for
four years and it was nine more before she was launched. She floated on her lines and on an even keel. She sails if there is a ripple on the water and brings us to an anchorage in any air we are willing to go out in.
four years and it was nine more before she was launched. She floated on her lines and on an even keel. She sails if there is a ripple on the water and brings us to an anchorage in any air we are willing to go out in.
- Status