Buying Privately

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Tinto

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hi All
after a long search I have had an offer accepted on a boat subject to the usual proviso's.

It s a private sale with the previous owner being a company. So there are two may areas of concern. Which I may or may not have fully understood. The boat was on the Part 1 for a while and is now on SSR part 3 as the current owner is a private individual.

1) that the current owner got a VAT receipt with VAT number from the selling business and not a private individual, when he bought it.
2) That all the paperwork the current owner has is correct, but there is no way for me to know if he took a loan out on it yesterday and I just have to take that on trust and that he is filling out the RYA transfer forms honestly.

Anything else, I need to be doing? Have I misunderstood anything?

It gets surveyed in a couple of weeks.

Thanks in advance.

Tinto
 
Tinto said:
1) that the current owner got a VAT receipt with VAT number from the selling business and not a private individual, when he bought it.
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If you're saying that the current owner has a receipt with, on it, the VAT number of the previous owner then you're all good because that proves VAT has been paid.

Tinto said:
2) That all the paperwork the current owner has is correct, but there is no way for me to know if he took a loan out on it yesterday and I just have to take that on trust and that he is filling out the RYA transfer forms honestly.
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To secure a loan against the boat, the boat needs to be on the Part 1 register, so that the lender can register an interest with the registry.

You said the boat is currently on the part 3 register, which does not have the same facility. Thus surely no loan can be secured against it?

You can take a loan out and say "you can trust me, I have a boat you can repossess if I fail to pay" but if the boat's on the part 3 it's not actually secured against it. Now he has sold the boat, it no longer belongs to him, and can't be repossessed by his creditors (they have to go after the money in his bank account instead).
 
The typical bill of transfer wording provides that the vendor warrants that there are no outstanding charges against the boat and indemnifies the new owner against any such charges pre-dating the transfer.

You wouldn't want to rely entirely on such wording (e.g. if something seemed a bit fishy), but neither would you want to do without such wording to concentrate the mind of the seller.
 
While unregistered loans against a boat are unusual (and difficult to enforce) there are other ways that claims can be made against a boat. The most obvious is unpaid berthing fees or for work carried out on the boat which are relatively easy to check. The others include those that might have a claim on the asset for example through a disputed divorce case or other internal family agreement. The problem with boats is that they don't have a clear legal identity and title once you get past the original transfer from the builder to the first owner is reliant n essentially self declaration. Clearly Part 1 registration helps although now that they do not demand a complete history from new all it can tell you is that title has not been challenged since the boat first entered the register.

Bit disappointing the current owner did not keep it on Part 1 - no reason why a private owner should not register it. While the VAT receipt is useful in reality it has little value as there is no legal requirement to keep the receipt and it is not evidence of title to sell on its own - title transferred by BoS is stronger.

While all this sounds a bit negative the reality is that thousands of boats change hands every year without any problems and the basic checks are easy to do - as you have done - and most people are honest!
 
KompetentKrew said:
If you're saying that the current owner has a receipt with, on it, the VAT number of the previous owner then you're all good because that proves VAT has been paid.
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Not necessarily, In 1976 I bought a new boat from a boatyard which was part of a group, The invoice I received for the boat was typed out on an old fashioned typewriter on headed note paper and the Vat Registration Number was typed in. as was the details of the boat and the list of extras, added up and listed at the bottom of the page.
Due to a mistake they had to do another invoice as they had charged me for an item of equipment which I had not bought and they had to do another invoice, Which this time came from head office, This showed another Vat Registration Number. The business had a few Limited Companies. The boat firm I bought the boat off went bankrupt a short time later However on typing in the name of the Ltd Co on the website Endole I see that a firm of the same name only started in 1987 and went into liquation 1 month ago.
 
Of course, there are some risks in buying privately, when large sums are involved. The worst is people selling a boat which isn't actually theirs. I know of one instance when the boat was locked up in a divorce settlement dispute. Thankfully these cases are rare. But you are right to spin out the purchase process a little, by making it subject to survey, to see if any problems emerge. If possible see if you can do discrete background checks on the seller: ask the yard about the boat etc.

Last time I bought a boat privately, I asked the owner what yacht club he belonged to. Then I rang the club that weekend and asked if he was there. "Oh no, he's out doing up his boat to sell" someone indiscretely replied. That was good enough for me.
 
We went through a similar process earlier this year and it all went well. Apart from due diligence, you need to trust your gut and walk away if something seems fishy. As a previous post states, most people are honest. My vendor had a paper trail that stacked up and the boat had been damaged and was being repaired by the insurers at a reputable yard which also gave me confidence.
That said, even with all that it was still pretty tense at times when large sums of your hard earned cash are involved. We used the RYA forms and their advice and it all went well. The boat is now sitting on my mooring.
Good luck. Keep us all informed.
 
A Company the original owner owned the bot it was Part registered (often used to secure a loan).

It has been Sold to current owner who has a VAT receipt from original owner which he says he will pass to you, was he connected to the Company Original owner?

You need to make sure it is clear of all liens and encumbrances such as loans, outstanding finances or unpaid bills.

Obviously a surveyor needs to do his stuff but also an inspection by an experienced and trained engineer from the engine manufacturers dealership should do a full engine inspection and attend a sea trial to ensure the engine is performing correctly and to go through the service records provided with you to exactly what has or has not been undertaken.
 
survey is next week. sea trial was done with a very diy skilled pal who has 30k nm

engine oil will be sent for analysis

manufacturer went bust years ago. its no longer on Part 1. not much can be done to check loans etc. It comes down to trust and people being honest.
 
thank you for everyone’s advice.

That is the deal done and I am now the owner of a Starlight 39. Nothing major came up on the survey the worst being a leaky flexible water tank.
So working away at it now getting it how I want it
 
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