Buying through a Broker.

[ip485]

However, to try and twist this occasional need into a gratuitous attack on brokers is pretty bad form. Worse, it brings absolutely nothing useful to the table.

That was certainly not my intention and I hope I have made that clear.

However having followed this forum there are certainly more than a few accounts of poor experiences, and should it be you who finds your deposit misappropriated or with issues over title then you might have been pleased to have at least better understood the process so as to be able to make an informed decision.

 

[dom]

Any advantage in my using a solicitor to handle the deal when buying through a broker.

To answer your question: a solicitor may indeed be worthwhile in large, complex, or offshore transactions. There has been some tricky case law on this recently and you will occasional hear about the "Peters" case; to be fair the ruling does provide some cause for worry.

The whole topic is, however, very well covered in this thread:
http://www.ybw.com/forums/showthread.php?299972-POLL-Do-you-trust-your-money-with-a-yacht-Broker

jonic is one of our resident brokers, whilst jfm, observer and a couple of others over there are fully paid-up legal hotshots. All provide insights which would cost quite a bit if personally commissioned, so well worth a read.

 

[dom]

That was certainly not my intention and I hope I have made that clear.

However having followed this forum there are certainly more than a few accounts of poor experiences, and should it be you who finds your deposit misappropriated or with issues over title then you might have been pleased to have at least better understood the process so as to be able to make an informed decision.

Not sure why you're getting shirty; your first post on this thread was made after the post of mine you cite!!!

 

[prv]

I think brokers should be far more willing to allow buyers and sellers to spend time together

Plenty of sellers don't want to spend any time with the buyer - that's why they employed a broker.

Buying our first boat, a broker handled the paperwork but we dealt mostly with the charming old gent who was selling her. He showed us the boat, helped derig her for transport, talked over lunch about his travels in her, and on our last meeting presented me with the Admiralty Manual of Seamanship he acquired on joining the Navy in the 1930s. I think he was very pleased that his boat was going to a good home.

The second boat was sold 100% through the broker. We never met the seller, nor exchanged a single phone call or email. I don't even know his name, though it'll be on the paperwork of course. No problem doing it that way either - the broker knew the boat and handled everything very smoothly. In practical terms, we might as well have been buying the boat from him. The seller will have simply received an offer to consider, followed by a bill of sale to sign and then a large cheque, no complications or demands on his time. That's the service he wanted, and which he's presumably happy to pay a decent broker for.

Pete

 

[JumbleDuck]

But isn't the reason for buying privately the attraction of a slightly lower price by perhaps up to the broker's fee when the seller does not lose financially; and the advantage of buying though a broker with the security of purchase (title, contract, money) and the slightly higher price for that service.

I think it is important to remember that the broker, however good, works for the seller, is paid by the seller, looks after the seller's interests and has no duty of care whatsoever to the buyer. My advice to the OP would be that if the purchase is complicated enough to warrant the use of an expert on your side, it doesn't matter whether you're buying direct or through a broker.

In some countries it's common for the buyer to use a broker, but I don't know if that's possible in the UK.

 

[ip485]

Not sure why you're getting shirty; your first post on this thread was made after the post of mine you cite!!!

I really wasnt getting shirty - I just wanted to make clear that I understood your point and felt my post needed explanation.

Plenty of sellers don't want to spend any time with the buyer - that's why they employed a broker.

As of course the seller is entitled to do. Personally I prefer to talk to the seller because I think that can reveal a great deal about the boat - but if you feel you dont need to know, and are comfortable with the broker then good.

 

[Malo37]

A rather jaundiced point of view.

If it were true, they would all go out of business

How do they add value? - Jaundice has nothing to do with it. At the end of the process the the boat is precisely that same as it was initially. The only difference being that the broker has managed to insert himself between seller and buyer and skimmed off between 5 and 10% plus vat.

 

[prv]

As of course the seller is entitled to do. Personally I prefer to talk to the seller because I think that can reveal a great deal about the boat

I would like to talk to the seller as well, but if he doesn't want to be involved then there's not much I can do about it. But your post ("brokers should be far more willing to allow buyers and sellers to spend time together") reads as though it's the brokers deliberately keeping people apart.

Pete

 

[prv]

How do they add value? - Jaundice has nothing to do with it. At the end of the process the the boat is precisely that same as it was initially. The only difference being that the broker has managed to insert himself between seller and buyer and skimmed off between 5 and 10% plus vat.

Which the seller has paid. Why would he choose to pay that if he wasn't getting any value from it?

It's not even like the situation with houses, where a lot of people think that estate agents and solicitors are mandatory (and if a mortgage is involved, the solicitor usually actually is). Everybody knows you can sell a boat yourself, so the choice to pay for a broker is a completely free one.

Pete

 

[Malo37]

Agree with your point. Some folk are happy to pay and that's up to them. My objection is a broker stating that my boat is worth less because it is for sale privately. Arrogant B*****. ps Not you - the broker !!

 

[dunedin]

Agree with your point. Some folk are happy to pay and that's up to them. My objection is a broker stating that my boat is worth less because it is for sale privately. Arrogant B*****. ps Not you - the broker !!

Get over it. The boat is worth what somebody is prepared to pay and what you are prepared to accept.

It is a reasonable suggestion for a broker to make to a buyer to try to push for a bit keener price as the seller is not paying any fees. Just a suggested negotiation tactic. Could have just said use the reason that there is an R in the month to get a reduction.

You either agree the price and make the sale, or hold on for a better offer. Its the art of negotiation - oh, and that is the bit you sign up to do when you sell privately ;-)

 

[Tranona]

Agree with your point. Some folk are happy to pay and that's up to them. My objection is a broker stating that my boat is worth less because it is for sale privately. Arrogant B*****. ps Not you - the broker !!

So, you base your opinion on a secondhand report of an off the cuff remark by an unknown third party who you have never met.

Can understand not liking an offer that is presumably less than you are prepared to accept, but maybe if you employed a good broker who knows the market you might have more success in getting offers closer to what you are prepared to accept.

There is always a place for intermediaries in every type of transaction between individuals. They perform a useful function for those who use them. Do you buy your car direct from the factory? No, you use an intermediary. The car is the same car both before and after the dealer handled it. Just the same as with a boat where the broker has earned his commission for the services he performed for both the buyer and the seller. If you do not want these services there is no compulsion to use an intermediary.

 

[prv]

Do you buy your car direct from the factory?

I would if I could.

Pete

 

[ip485]

But your post ("brokers should be far more willing to allow buyers and sellers to spend time together") reads as though it's the brokers deliberately keeping people apart.

In my experience that is true and there is some evidence of this from other posts I have seen here where in fact the seller was very happy to talk to the buyer but was either persuaded otherwise or never asked. I find that odd, but there it is.

For me if someone wants to sell you a personal possession the least they can do is introduce themselves albeit perhaps then make clear for business or personal reasons there time is limited and they have essentially placed the sale in the hands of their broker. Again, of course the seller can conduct the sale in any way they wish, all I can say is it would put be off as a buyer.

 

[nickf]

If you do not want these services there is no compulsion to use an intermediary.

And personally, I see very limited value in using an intermediary whether buying a horse, boat, or house. On the other hand I do see the use of using a solicitor on occasions.

 

[Poecheng]

Any advantage in my using a solicitor to handle the deal when buying through a broker.

I do not believe so.
Understanding the contract: this is fairly straightforward to understand. Whilst it is the seller's agent who provides the contract it is not skewed in the seller's favour if it is the standard YBDA contract which is designed to be neutral as between the parties.

Altering the contract: There is some (but I suspect little) chance of changing the terms of the contract. The main one that gets in the way is the 10% deposit and the requirement to follow through in the absence of undisclosed material defect. We then get into concern about what in real terms amounts to material defect. Some would (entirely reasonably) rather not go there and want to have a survey without commitment; some brokers will refuse to any such a thing as they could be left with a boat in the wrong place and subject to damage by the surveyor. I do not believe a solicitor will assist on that particular point which is a commercial decision that is reflected in any contract rather than a legal matter. There is no reason why you cannot negotiate over the deposit - say you will only pay 2% as that will cover any likely possible loss and yet not be so high you cannot walk away. The market and the attitude of individual seller/broker will determine what if any percentage deposit is required.
I am not sure what else would need altering as risk and title are dealt with fairly.

Completing the details of the contract as buyer: This is straightforward but does need a bit of thought. A solicitor would assist that thought process. They would also assist you cross the road but you don't need them to do that either! Without going back to the standard contract (which I have studied in detail in the past) the parts that need thought are
a) the disclosed defects [you need to identify these so that there is particularity as to whether or not a defect revealed by the survey has been previously disclosed]
b) the details of the equipment included/inventory. Do not rely on the sales details unless these are referred to and incorporated into this section - make sure that everything you think is included is specified here - it is only if it is specified here that you can usefully complain when you do not receive it at handover.
c) the documents section. Whether under this section or under the equipment section you must specify each and every document that you expect to have. Failure to supply such documents is a breach of contract. permitting rejection. It depends on what is available but you want original sales invoice/VAT invoice, bill of sale, SSR, the manuals, any security codes, invoices for prior work including work done for this agreement, Bill of Sale to you, marina invoice showing payment of fees to the point you agreed, original brochures, any guarantees, documented history. Basically anything that you expect to be there at handover and will moan about if it isn't there as you hoped.
All of the above may seem picky but you are simply reducing your expectations to writing as the contract requires you to do. It doesn't matter if the response is "of course we will give you the original VAT invoice", this gives you the right under the contract to rescind the contract rather than argue about its relative importance and its monetary worth.

Money
Money in solicitor's client account is protected and insured. However, whether in your solicitor's client account or your account, it has to be handed over to the broker under the agreement. As they are the seller's agent that in contract law would ordinarily amount to payment to the seller but I would need to check the actual contract. The risk re the money would ordinarily be the seller's from the point of handover and the title and risk in the boat would pass to the buyer.
When buying the last boat (Michael Schmidt, Hamble Point) I was provided with the account number, the account title (a client account) and a letter of comfort from the bank in relation to that numbered account and that it was a client account etc. In my transaction the seller appeared at handover and watched as the money was received in and watched it as the broker transferred it to his account.

Once you have reached handover, it is down to you to check the inventory and documentation and any other outstanding conditions that have been specified in the contract (e.g. engine trial if agreed that way - we did)

I think for most people on here there is no need for a solicitor. If, however, you are i the serious money league where you are registering as a company in Gibraltar or whatever, then specialist may add something and avoid expensive future issues.

 

[Tranona]

I would if I could.

Pete

But you can't - at least not if you are an ordinary buyer. However, back in the 1960s I collected my parents' new Cortina direct from the factory where it was made - buying through the employee scheme. We bought many cars over the years this way as the scheme was open to pensioners as well so my mother could get cars while she was alive but years after my father died. In later years, although the discount was the same the deal was through a dealer who got a commission plus the sale counted towards his volume.

Just another form of intermediary!

 

[Tranona]

And personally, I see very limited value in using an intermediary whether buying a horse, boat, or house. On the other hand I do see the use of using a solicitor on occasions.

That is personal choice and clearly many people have a different view. In this context a solicitor is an intermediary and for buying a boat you can always use a broker for the legal bit if you are nervous about doing it yourself. Much cheaper than using a solicitor and probably more reliable. For a typical boat purchase a solicitor is highly unlikely to offer any value to the process.

 

[JumbleDuck]

But you can't - at least not if you are an ordinary buyer.

Didn't Daewoo enter the UK market by selling through directly-owned shops? Morgan still list themselves as a dealer, but perhaps that's only for second-hand cars these days.

 

[Malo37]

So, you base your opinion on a secondhand report of an off the cuff remark by an unknown third party who you have never met.

Can understand not liking an offer that is presumably less than you are prepared to accept, but maybe if you employed a good broker who knows the market you might have more success in getting offers closer to what you are prepared to accept.

There is always a place for intermediaries in every type of transaction between individuals. They perform a useful function for those who use them. Do you buy your car direct from the factory? No, you use an intermediary. The car is the same car both before and after the dealer handled it. Just the same as with a boat where the broker has earned his commission for the services he performed for both the buyer and the seller. If you do not want these services there is no compulsion to use an intermediary.

A few observations: as has been previously stated the broker is not employed by or providing services to the purchaser. To do so would no doubt be considered a conflict of interests. Car factories don't sell used cars. In fact this is a good point - used car dealers and used boat brokers have a lot in common.