marine mortgage

[capel679]

can anyone help to explain why i have to cough up £546 to register our vessel ???
if she is already registered do we have to repeat. we will be changing her name so i can only assume thats why.
oh and all the best in all things marine for 2005 !!!
ps. just about to buy with marine mortgage..

 

[bruce]

if you are like over here, that is the gov way to tax a 'new' purchase, like buying a used car...

 

[Guest]

Post deleted by danfoley

 

[wooslehunter]

Here's an example of Pt 1 reg vs Pt3 (SSR).

When I bought my boat it was SSR registered. The previous owner was supposed to inform the SSR of the change but did not. Neither did any of the documentation I had with the boat tell me it was on the register. I just phoned them up, gave the details of the boat & previous owner and they confirmed it was registered. By phone, I then changed it over to be registered under my name. No proof required & a week or so later back came a new registration document.

Hence, SSR is no proof of ownership and that's why mortgage companies require Part 1 to proove ownership and secure their loan.

 

[Bluesbreaker]

Re: marine mortgage (re:Wooslehunter)

Who did you phone/contact .Regards in anticipation.

 

[sixpack]

Suggest you change your mortgage company.
I have just bought a boat with SSR registration only. Not only that but the previous owner did not change the details so the recorded owner as far as the SSR paperwork was concerned was 2 owners ago.

Lombard Marine had no problem with the mortgage although I did provide bills of sale going back to first owner along with vat certificates etc.

Cost of changing details on SSR was/is £12 and for that one can change the name and details of registered OWNER. (change owner details first)

Your £546 ~(+vat?) sounds like another example of "rip-off britain"

 

[Guest]

Post deleted by danfoley

 

[sixpack]

CRAP!

I have just taken out a substantial marine mortgage through Lombard Marine without pt1 registration. As I said earlier change the mortgage company, try Lombard and IF you are in good standing credit wise you should have no problems.

I was able to produce the bills of sale back to original owner along with vat certificate and SSR registration THAT WAS ALL I NEEDED. As for the amount suffice to say it was well in excess of the figures you quote.
As a point of interest pt 1 is for commercial vessels and pleasure craft over 24m. Maybe the vessel in question is over 24m in which case it should already have pt1 reg if previously kept in UK waters.

The only thing a surveyor is need for is the tonnage measurement (½ ~ 1 hours work?).

Final point: Before even thinking about pt1 reg, phone the MCGA and make sure you are eligible and actually need it

 

[cliff]

Having read through the thread it seems to me there are a few "barrack room lawyers" out there and a bit of the old "bullsh*t" flying, so .........

If the vessel is already pt1 registered you should not need to go through the whole rigmarole of reregeristing from scratch - not the use of the word "should".

Having bought my present "boat" using a marine mortgage all I can say is I did not require pt1 registration and the mortgage was/is substantially more than the 20K personal loan limit.

As with a house mortgage the lendor will hold the title on the vessel until the loan is discharged.

I suggest you check with other marine finance houses and also contact the MCGA - here

----------

 

[Birdseye]

I agree with sixpack - the charge is ridiculous. It might make sense to talk about measurements with ships but grp boats come out of moulds and the measurements are available at the end of the phone. Admin of a database like the pt1 cannot cost remotely that amount even allowing for its being done by the civil service. So yes, it is a rip off. And it is one that definitely does not prove legal ownership beyond doubt as has been said many times before on this forum. Doesnt even prove the boat free of debts.

Incidentally, since when was yacht surveying elevated to a profession along with (say) medicine? I reckon its a trade.

 

[Guest]

Post deleted by danfoley

 

[Ships_Cat]

As with a house mortgage the lendor will hold the title on the vessel until the loan is discharged.

What was the "title" document for the boat that the lender held? Apart from entry in the Register of Ships, I was unaware that any other such document existed proving ownership and against which liens or other claims against the boat could be entered and be publically searchable.

Fatipa has it all correct with his explanation. Others are getting confused with other financing instruments.

I have also done a quick search of some UK financiers offering marine mortgages. All the ones I looked at list registration as one of the steps during the putting in place of the finance.

John

 

[cliff]

All I can say is I have just taken out a marine mortgage with Lombard Marine, did not require pt1 registration, and the sum was/is well in excess of the "personal loan" limits. There are obviously other mechanisms whereby mortgages can be given without pt1. Perhaps past track record counts? Or, could it be who one knows? nod, nod, wink, wink......

--------------

 

[Sans Bateau]

Cliff

I fully agree with you. We just sold Out To Play, we had a marine mortgage secured with the title deeds of the boat, that was with Barclays Marine, when the mortgage was settled Barclays sent us the original bill of sale, etc.

Our new boat loan which is very substantially more than £20k has been bought using a marine mortgage through Bank of Scotland. This deal is so new it is happening as you read this! Neither mortgage, I repeat neither mortgage needed Part 1 OR Part 3. Any loan, mortgage or lease will be subject to credit rating, i.e. your ability to repay.

You will find that below about £16,000 marine loans are 'personal loans' over that sum the lender will only lend as a mortgage secured on the vessel. If you have a lender insisting on Part 1 registration, find a new lender!

 

[Sans Bateau]

Brian

Do you have a marine mortage? It just could be that yours is with the same lender that CAPEL679 is looking at.

 

[Ships_Cat]

What are the "title deeds" you refer to? - sounds like they are just proof of purchase and if so they are not title deeds. The equivalent of, say, a title deed for real estate, for a boat is its document of registration.

No matter how it is named by the lender, you do not have a proper marine mortgage, you just have a conventional financing deal with the boat as security - in the same way as if you had borrowed to buy a refrigerator with the refrigerator as security.

A marine mortgage can only be registered on the Register of Ships that the purchased vessel is on ie it must be a registered vessel. If you know of anywhere else where a marine mortgage can be registered, please let us know. Anyone buying a registered vessel should search the register to see if it is encumbered by a mortgage

John

 

[Birdseye]

Finally got off my bum and dug out some info on the legal aspects of buying a yacht. The law moves on all the time, so if the answer to the question is important to you, dont rely on my interpretation - consult a lawyer.

Contrary to what I wrote earlier, it says that Pt 1 reg does confirm title, and that any unregistered mortgages are invalid against a bona fide purchaser without notice of them. It goes on to say that this does not mean the boat is free of liens ie debts that transfer with the boat such as unpaid marina bills.

The SSR is not a register of title. In this case docs proving the chain of ownership from build to the present inc bills of sale etc would be the title docs. Apparently in a court case in 1992, it was held that a mortgage on an unregistered yacht was valid not only against the original borrower but also against any subsequent owner. Same comment about liens applies.

So clearly you can have mortgages against SSR or unregistered vessels and they do "travel" with the vessel. Looks to me as if the bank is no worse off giving a mortgage against an SSR boat but you the potential purchaser are a bit safer buying a Pt1 boat.

 

[Sans Bateau]

You are correct; the "title deeds" are in fact original VAT invoice, subsequent bills of sale, builder cert etc. However the HBOS has referred to them as 'title deeds'. What is interesting is that in neither purchase example has the lending bank asked for anything more, also they and their documents refer to the loan being a "mortgage". When looking at the financing options available, none of the lenders appeared to offer anything different to that which we have adopted.

 

[Ships_Cat]

Hi Birdseye - as I am not in the UK I can only speak generically according to international terms (marine is an international industry so its insurance and financing practices tend to be the same most places).

Documents outside of the register such as bills of sale, etc do not constitute title in the "real estate" sense (or even prove ownership) to a vessel as they may be easily possessed without owning the vessel (unlike, say, a land title) and are not publically searchable. One cannot go to some public place and inspect bills of sale for any vessel you may wish to purchase or investigate the ownership of - one can only ask of them from the vessel's "owner" and place your trust in him that he has not also sold the boat to some other guy down the street who did not ask for them. But possession of them may help prove ownership.

As I think you say, the vessel's registration documents do not constitute incontestible title to the vessel (I am not sure that even applies with land titles these days in many places) but you can go and search the register to see who the "owners" are on that and any encumberances (if they were registered with the Register of Ships) on the vessel.

A marine mortgage should proceed similarly to real estate where the process is public.

If it is a new vessel which is to be mortgaged then you prove ownership of the vessel to the register (by means of the Builder's Certifcate) and the vessel is placed on the register. The lender seeks proof that the vessel is on the register with you as owner by his own inspection of the register (or probably with a new vessel simple production of the just issued registration documents). If that is so then he advances the money and his interest is registered with the Register of Ships.

If it is an existing vessel already on the register, the lender will inspect the register to see that you are the owner and that there are no other encumberances. Also, as there is not a solid aspect of title associated with the register as there is with real estate, and there is not a solid process of conveyancing as there is with real estate (especially for small vessels) he may seek further proof of ownership. That further proof may include things like bills of sale or simply that you are already a trusted client or he accepts the word of the broker if trusted.

If it is an existing vessel not registered, the lender will require the vessel to go on the register to whom proof of ownership has to be provided and his interest noted. As the last case he may seek other proof of ownership.

I think it is easy to see that for the processes being described by others ie use of bill of sale, etc showing ownership and security taken over the boat on that basis is just the same as any other common financing arrangement whether it be for a fridge, television set or whatever in the case that security is taken over the item whose purchase is borrowed for. Those arrangements are not commonly regarded as mortgages (again, in most places that is) and is the acid test.

I have had a look at the Barclays site, and as has been said, they make no mention of the register. However, the ommision of that makes the financing arrangement read just like any other where a non publically searchable security is taken - I see nothing that qualifies the arrangement for the term "marine mortgage" but, of course, there is probably nothing that stops them from calling it such so they are free to do so.

Note that I am not a marine lawyer so am open to challenge by one, but I do work in the marine industry with commercial vessels and have stated the requirements as I see them to be.

Also, anyone buying any vessel that could be on a register should make sure that they search the register before purchasing the vessel. Failure to do so and subsequent finding that the vessel is on the register with a marine mortgage registered against it, will lead to tears. Note also that it is easy to remove the surveyor's carving from the vessel so taking away its identity (and for some registers there is no requirement to carve the boat for smaller vessels and nor for meeting the normal marking requirements on superyachts or other quality pleasure vessels if that will detract from their appearance).

John

 

[Sans Bateau]

J Dowd (all very formal)

Reading the last few posts it is easy to get very confused with this whole business. There are two issues here 1) Part 1 registration 2) Getting a loan to buy a boat.

I have never had to Part 1 register a boat, so I will not make any comments.

I have however bought two boats now; both with the assistance of funds provided by, firstly Barclays Marine and most recently Bank of Scotland marine finance, so I believe I have a little experience. In both cases the provider of the funds has called the loans 'marine mortgage'. Whilst this term may not rest well everyone, both establishments are reputable companies, and I am sure they know what they are doing. Neither of these companies has asked me for part 1 registration and it would be good to hear from others who have a mortgage on their boat if they have had to register in any way.