Buyer Guide

Get professional advice on buying a yacht.

1. Why use a Broker to help you to buy a boat

We have extensive knowledge of yachts and the current market, making us a valuable source of information. Our boat owners’ and brokers’ network spans statewide, national, and even international levels, providing instant access to boats for sale. When purchasing a yacht, it’s essential to consider the rights and responsibilities of it. In addition to selecting the ideal design and equipment features, strict rules for payment and registration must be followed, along with important post-purchase considerations.

2. Determine what type of yacht you are interested

There are a wide variety of yacht types available, each with different hull types, styles, performance capabilities, and budgets. When considering purchasing a yacht, it’s important to answer these questions:

-What kind of experience do you want to have with your yacht?

-Do you want a new or used yacht?

-Do you prefer a custom built or semi-custom yacht?

-Do you want a high-speed performance yacht for weekends, or a yacht for genuine round-the-world blue water cruising?

-What size of yacht are you looking to purchase?

-How do you plan to use your new yacht?

3. Determine what type of yacht you are interested

From yacht builders, to hull types, to the different styles and their uses, there is a vast array of different yacht types available, each with a varying range of wildly different sizes, styles, performance capabilities, purposes and of course budget.

When considering a yacht for purchase, be able to answer the following questions:

-What type of experience and use you are looking for in your ownership?

-Are you interested in a new or used yacht?

-Do you prefer a custom built or semi-custom yacht?

-Are you looking for a high-speed performance weekend boat, or a genuine round-the-world blue water cruising experience?

-What size of yacht are you looking to purchase?

-How are you planning to use your new toy?

-By law, your money can’t be spent without your written authorization, and your Offer to Purchase should always depend on your satisfaction of a Sea Trial and Survey.

4. Offer to purchase

After you decide on the boat you want to buy, we prepare an Offer to Purchase for your signature. You also make a good-faith deposit on the boat, usually 10 percent of the purchase price. Your deposit goes into a bank trust fund that a licensed broker administers. By law, your money can’t be spent without your written authorization, and your Offer to Purchase should always depend on your satisfaction of a Sea Trial and Survey.

5. Financing a yacht

It is imperative to note that various banks offer financing options for the purchase of new or pre-existing yachts. Although the terms and conditions of the loan can vary, a portion of both the loan and interest payments can be postponed until the end of the loan term. The deferred payment can be paid off either by refinancing or using the proceeds from selling the yacht. If you opt for this financing option, it is important to note that the lender may exert influence on the country where the yacht is kept and registered and may require direct payment of the charter fees to the bank.

6. Memorandum of Agreement (MOA)

If you decide to purchase an existing yacht, you will need to sign a Memorandum of Agreement (MOA) with the seller. The MOA should outline both parties’ rights and responsibilities in case of any issues that may arise, including the right to cancel the transaction. It should also detail all the equipment that will be included in the sale, from navigation and safety gear to interior furnishings, as well as the necessary documentation for a seamless transfer of ownership. The MOA must specify that the yacht will be transferred without any outstanding debts. Additionally, it is advisable to have the yacht surveyed by a qualified and insured surveyor before finalizing the purchase, including a sea trial if possible.

7. Getting a Sea Trial and Survey Sea Trial and Survey

Congratulations! The seller has accepted your offer on the boat. You have already secured your financing, and now it’s time for a sea trial to test the boat’s performance in the water. Typically, the seller provides the sea trial, and we will accompany you to answer any questions you may have. During the survey, you’ll have the chance to identify any issues, ensure that everything works properly, and assess the boat’s condition. As a buyer, you’ll be responsible for covering the costs of the survey and hauling the boat out of the water for inspection. If any unexpected problems arise during the survey, you may be able to negotiate the price with the seller.

8. Use a Marine Surveyor

It is not advisable to solely rely on a surveyor recommended by the seller or a survey report provided by them. This is because the report might not account for issues that have emerged in the boat since the report was written. To ensure a fair assessment, it is important to hire an independent marine surveyor to inspect the boat both in and out of the water. These professionals work in your best interest, as well as that of your lender and insurance company. If you need assistance finding approved marine surveyors, your lender or broker can provide you with a list.

9. Sea Trials and Survey Report

One important purpose of the survey is to determine the present state and worth of the boat you intend to purchase. If any issues or defects are discovered, the sea trial and survey can provide you with the option to withdraw from the contract without any consequences or to negotiate for repairs on the boat.

Please note: If you are purchasing a boat at an exceptionally low price or from a seller in distress, the sea trial and survey may not provide leverage for negotiation. The seller may be selling the boat “as is” and might not have the funds for repairs, leaving you responsible for any necessary repairs. We will provide copies of the survey report to your lender and insurance carrier for their review. They will require information on the boat’s condition, replacement value, and market value as determined by the surveyor. Please keep in mind, however, that surveys are not a guarantee against hidden or undetected defects.

10. Payment

When buying a pre-owned yacht, 10% of the total price is usually paid upfront. The remaining balance is paid after the yacht and all related documents have been officially transferred. In the case of custom or semi-custom yachts, a total amount for construction is agreed upon in the contract. The best payment option is to agree to make payments after each stage of completion to allow for any material delivery delays or unforeseen interruptions.

11. Delivery

In order to proceed with the purchase of the yacht, it is essential to provide all legal documents related to the title before making the final payment. Failure to complete this step will prevent the yacht from being registered and legally sailed. It is also important to agree on the tax implications of the delivery location. At this stage, an expert representative appointed by you will officially test the yacht at sea to ensure it meets its specifications.

12. Registration

It is mandatory for all yachts to be registered with a specific country and display a maritime flag, commonly known as an ensign. This is an absolute requirement by law and should not be taken lightly. Failure to comply with this regulation can result in serious legal consequences.

13. Insurance

When buying a yacht, it’s crucial to have insurance to protect against accidents. To ensure proper coverage and reduce risk, it’s important to disclose all relevant information to the underwriter when determining premiums. Additionally, it’s wise to research the underwriter’s location and financial regulations to avoid potential insolvency issues. Remember, insurance is a major investment and should be approached with care.

14. Deciding where to dock your boat

The cost of docking your yacht can vary based on the port’s location. It can be a significant expense, especially in high-end Mediterranean harbors. Investing in a mooring can be a wise decision, but it’s crucial to carefully assess the sale terms. Marina managers may impose additional charges, and tax implications may need to be considered.

15. Taxes

If you intend to keep your yacht in EU waters, it’s crucial to be aware that you might have to pay Value Added Tax (VAT) depending on the country. Normally, VAT is paid in the EU country where the yacht was initially brought in. Once the VAT is paid in one country, it’s acceptable in all other EU countries. Therefore, it’s feasible to bring your yacht into the EU through the country with the lowest VAT rate. However, if you take your yacht out of the EU for a specific period, the VAT clock restarts, and you must pay the tax again. It’s vital to have the necessary paperwork on board to prove your yacht’s VAT status. Some yachts are exempt from VAT, such as those constructed before a specific date and anchored in the EU on a particular date, as well as vessels registered outside the EU and owned and temporarily used by non-EU residents.

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