For many people, buying a boat will be the most expensive purchase they’ve ever made. Here’s what you need to think about before handing over any cash.
1. What checks do I need to make when buying a boat?
Buying a boat is like buying a car. If you’re buying a boat to live in, that might feel counterintuitive – especially when you might be parting with sums far in excess of anything you’d pay for a car. Boat prices are usually (!!) lower than house prices, but you’re still paying tens of thousands of pounds. Or more. That’s a lot of money to part with if you’re making a relatively informal deal with a private individual.
A reputable broker (look for membership of the British Marine Federation) will offer you some protections, but when push comes to shove you have to remember that when buying a boat you are essentially buying a very expensive car. You need to make the same checks as when you’d buy any other used vehicle – such as checking the boat’s ownership. Has it been stolen? Does it have any outstanding credit on it? And so on.
2. How do I pay a deposit safely?
No seller will hang around indefinitely while you’re doing umpteen checks, so you should expect to pay a deposit if you want him or her to hold the boat for you. Paying a deposit to a private seller raises its own worries, since you have no guarantee that the seller won’t keep the deposit and sell the boat to someone else.
You need to take the same things into account as when you’d buy any other kind of used vehicle – such as checking the boat’s ownership. Has it been stolen? Does it have any outstanding credit on it?
Before handing over any money, try to get as much detail in writing as you can confirming the condition of the boat and its history. Get the seller’s name and address details, plus some reliable ID. A trustworthy seller won’t object to such requests.
You can also use an escrow service to exchange large sums of money.
3. Do I need to get a survey?
Yes, usually speaking, although it’s not like buying a house where the mortgage lender insists on it. When you buy a house, the mortgage lender wants assurance that they will recoup the value of their investment in the event that you default on the mortgage. When buying a boat, by contrast, the survey is for your benefit alone.
What protections does a survey provide? And what does it cost?
Getting a survey might not provide legal protection as such, but a reliable marine surveyor should be able to clarify whether or not you’re buying a turkey. A survey costs anywhere from £400 up, plus around £300 to crane the boat out of the water. In total, expect to pay between £700 – £1000.
Getting a survey might not provide any legal protection in the event of something going wrong with the boat, but a reliable marine surveyor should be able to clarify whether or not you’re buying a turkey.
If the surveyor finds problems, you might be able to haggle down the price of the boat based on the report. But if you decide not to buy at all based on the survey, you’ve lost a lot of money. Where possible, find someone knowledgeable to look over the boat with you before investing in a survey. Even a concerned friend might cast a cool eye over proceedings.
I’ve seen a boat I like and it’s had a recent survey. Can I use that?
Some boats have had a survey purchased by another prospective buyer. The survey remains their property, so unless they agree to show it to you (and they may well not) you will need to buy your own.
However, if someone has paid up to £1000 for a survey and then pulled out, you might draw your own conclusions.
4. Do I need a solicitor to buy a boat?
Property law is – literally – a law unto itself. It relates to actual ownership of land, which is why you need a solicitor when buying a house. In legal terms a boat is not property; it is a movable possession. As such it is not subject to property law and you do not need a solicitor.
That said, you can instruct a solicitor to oversee your boat purchase, and there are specialist marine solicitors who deal with boat sales. However, these tend to specialise in very expensive boats. Some super yachts cost hundreds of millions…!
What services would a solicitor provide?
When I bought my boat I contacted a specialist solicitor who reviewed the contract. He confirmed that it was a fairly standard document conforming to British Marine Federation standards. He said I should see all documentation pertaining to the boat’s ownership and finance, prior to completing the purchase.
In strictly legal terms, a boat is not property as such, since it is not land.
Helpfully, the solicitor didn’t charge to review the contract, but had I instructed his firm it would have cost £1800-£2000. In the end, I didn’t bother.
5. Can I get a mortgage to buy my boat?
A mortgage differs from a loan in that it is secured against property. This means that the lender retains rights to your property until the mortgage is paid off. Usually boat finance comes in the form of an unsecured loan, so the sum borrowed is not directly linked to the boat. That means you could spend the borrowed cash on anything, and doesn’t have to be a boat.
Unsecured loans from general lenders are not usually available for very high amounts (for instance more than £25,000). Some specialist lenders offer boat finance for larger amounts, but strictly speaking these are not mortgages.