gordhouse
Well-Known Member
Does anyone know if there is a way of finding out if there is any outstanding hire purchase on a boat prior to purchase,eg HPI on cars?
outstanding HP on boat
- Thread starter gordhouse
- Start date
Pinnacle
Well-Known Member
Is the boat Part 1 Registered?
gordhouse
Well-Known Member
Hi
No evidence in the paperwork on file of part one.
So where do i go from here.
No evidence in the paperwork on file of part one.
So where do i go from here.
D
Deleted User YDKXO
Guest
Even Part 1 is not cast iron evidence of the existence of any outstanding loans on a boat as occasionally loans aren't registered, particularly non marine mortgage loans secured on the boat. Basically, there isn't any foolproof way of determining whether the boat is secured against a loan. If you are buying through a broker, his job should include trying to check for any outstanding HP or mortgages but in reality he can't do much other than check Part 1 himself.
If you are concerned about buying a boat which you think might have outstanding HP on it, probably the best course of action would be to have a marine lawyor draw up an agreement to be signed by the seller which confirms that the boat is being sold to you free of all debts and liens. Even then, there are some on this forum who say that the seller has no right to sign away the HP company's title claim on the boat in this way.
Sorry buying a boat is a bit of a minefield in this respect and at the end of the day you are reliant on the seller's word that all HP and mortgages have been or will be settled on completion
Searush
Well-Known Member
If buying thro a broker, he should do a search of finance companies for you. Otherwise, you will find it difficult. You could get a written statement from the seller, but not sure what if any protection it will give you if it all goes wrong - other than perhaps enable him to be prosecuted for fraud after you have lost the boat.
The seller could have a Declaration of No Liens produced and signed by him and witnessed by or maybe in front of a solicitor?
Also it would be wise to contact each of the key finance houses who were lending back at the time the boat may have been purchased. Give them the Hull Number and the owner/s names and ask them if they have any outstanding debt on the boat.
Ask the current owner who he is insured with as they will also have a note on file if the boat is financed.
Best of luck
Tom
Also it would be wise to contact each of the key finance houses who were lending back at the time the boat may have been purchased. Give them the Hull Number and the owner/s names and ask them if they have any outstanding debt on the boat.
Ask the current owner who he is insured with as they will also have a note on file if the boat is financed.
Best of luck
Tom
D
Deleted User YDKXO
Guest
Thats what I suggested and I have done myself in the past but is it worth the paper it's written on? Effectively what such a document is doing is transferring the security any finance co have on the boat to cover their loan back to the seller. Surely such a transfer would require the agreement of the finance co themselves which IMHO they're very unlikely to give?
jfm
Well-Known Member
No it's not I'm afraid. It gives you firm evidence to sue the seller if it turns out the boat is in fact pledged to a bank, but by definition he must be the kind of guy who would sell an uncumbered boat without telling you so he's a rogue and hence suing/collecting will be tricky/fruitless/hollow victory
It might purport to do that but it does NOT achieve that
Yes, and they will not give their agreement, especially as you don't know they exist so can't even ask them!
Furthermore, you are at risk of makings things worse. A statement of no liens seems to refer to liens. There are loads more ways a boat can be encumbered than mere liens. Indeed, a lender's security in the UK would NEVER take the form of a lien
I would recommend here:
1. Clear written statement from seller of no encumbrances
2, Clear written confirmation from broker that he has done the checks Searush suggests and a statement of his findings but beware if the broker gets clever and writes all this in a way that avoids any duty of care on him towards you (you probably don't have a contract with broker so you need a tortious duty of care to come into existence. alternatively you might be happy if he shows you all his etters to/from the finance cos)
3. Better than 2, but maybe unnecessay if you are happy with the broker's efforts, write to the main lenders yourself (Lombard, BoS, Barclays, HBOS, I think)
4. Google the seller and keep your wits about you. Credit check if you're worried (£10)
5. Get past insurance docs and ask insurers if they know of finance, as someone suggested above
6. At some point you stop but if still suspicious (i) ask dealer who first sold the boat (not much use if several previous owners) and (ii) ask seller to show you his current account for the 3 months starting with when he bought the boat to see if any payments to finayce co and if the price he paid matches the boat's then vlaue and (iii) contact the last owner and ask if they got paid by current owner or by a finance co. If still suspicious then walk away!
I appreciate some of the above is OTT. Depends on all the circumstances of the particular case in hand
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Deleted User YDKXO
Guest
Well actually in my case it did work and I think I've posted about this before. I once bought a repossessed Princess 435 from a marine finance co (NWS Bank) and, OK, it was 1993 so the legal position might have changed since then. Before I purchased the boat I did some investigation on the boat and its background and it turned out that the previous owner had a reputation for being a bit of a rogue. So much of a rogue in fact that he had tried to bribe staff at Moodys yard (where the finance co had stored the boat) to relaunch the boat after it had been repossessed. I started to get worried that there might be other loans secured on the boat especially when I heard that the previous owner had mortgaged nearly 100% of the boat's value to NWS. I got NWS to write me a letter saying that the boat was being sold to me 'with clear title and free of all encumbrances and liens'. Not knowing any better at the time, that satisfied me and I went ahead with the purchase.
Some months later, I received a letter from another bank claiming that the boat had been used as part security for another loan relating to the previous owner's business and they were now seeking to claim title to the boat since the owner had defaulted. I wrote back to them with a copy of the letter I'd received from NWS and I heard no more. I dont know why this loan was not registered on Part 1 or why the bank had failed to check Part 1 before taking the boat as security. And I don't know why the bank in question did not pursue the matter further with me. All I know is that they contacted NWS and somehow settled the matter with them as I heard this later from my contact at NWS. Maybe it would have been different if the seller had been a person rather than a finance co.
Having said this, I agree with all that you've said. In retrospect, I now think I was very lucky and I don't think that such a letter as I had is any guarantee of clear title
benjenbav
Well-Known Member
Mike: skilful rather than lucky. The position would have been as jfm mentioned. Where you did well is the identity of the person effectively indemnifying you against any encumbrances which was itself a finance house. The company that sold to you would have dealt with the second bank probably by telling them to stuff off (to use a legal term) because their claim was no good or would have paid out something from what they received from you. Conceivably they might have had to dip into their own pockets.
The point about any indemnity (which is basically what someone giving a declaration that there are no encumbrances is - although technically it may be distinguishable from an indemnity) is that it is only as good as the person giving it.
jfm
Well-Known Member
Mike, it only worked for you (and well done, I applaud what you did) becuase the person giving the promise of no encumbrances (= an indemnity or warranty; the distinction isn't important here) was a bank. They can't run away. But in OP's case the person giving the indemnity would be the boat seller, and if he is prepared to sell a boat without declaring his loans secured on it he is by definition a rogue. An indemnity from a rogue is worth Jacques Shiit. So what you did cannot be extrapolated into being a "good idea" when buying a boat thru a broker from an individual. It's critical to see this distinction.
D
Deleted User YDKXO
Guest
Thats kind of you to say that, benjenbav, but believe me it was just pure luck that I was buying a boat that happened to be for sale by a finance co. It was actually the price that attracted me rather than the seller and at the time I certainly didn't appreciate that there might be a difference between a letter of indemnity given by a finance house and one given by a private seller
Searush
Well-Known Member
I would guess that it is illegal to offer something as security if you don't own it (ie it is already heavily mortgaged) thus the second loan is then actually unsecured. In other words the second lender is responsible for carrying out their own checks, but hasn't - but I've no knowledge of this, just trying to make "uninformed" judgements. 
jfm
Well-Known Member
I would guess that it is illegal to offer something as security if you don't own it (ie it is already heavily mortgaged) thus the second loan is then actually unsecured. In other words the second lender is responsible for carrying out their own checks, but hasn't - but I've no knowledge of this, just trying to make "uninformed" judgements.
That isn't correct Searush. If you have pledged an asset to a first lender, there is nothing in law stopping you also pledging it to a second lender. You do not cease to own it merely because you have pledged it to a first lender. The second pledge will rank behind the first of course. Many assets (in the commercial world) are pledged to several (more than 2) lenders.
gordhouse
Well-Known Member
Thankyou all once again for your comments.
I thought buying a car was hard work but only involves an HPI check.
Probably a credit check is the best way to go.
The seller seems a nice guy and well known in the community. Maybe I'm a bit too suspicious having heard so many horror stories involving finance company snatchbacks.
Many Thanks
I thought buying a car was hard work but only involves an HPI check.
Probably a credit check is the best way to go.
The seller seems a nice guy and well known in the community. Maybe I'm a bit too suspicious having heard so many horror stories involving finance company snatchbacks.
Many Thanks
Seahope
Well-Known Member
When I bought my boat this worried me quite a lot too.
Apart from having in my contract with the seller the appropriate clauses that no finance was outstanding I actually asked the seller to prove what they had told me when I asked how they financed the boat. In the end they shared their bank statements with me as evidence just before I transferred the main sum.
As I bought my boat through a finance company I asked them to run checks for me, but I felt that these would not have really provided me any real security.
I do feel that for 2nd hand boat purchases some form of consumer protection should be available as today there appears to be none and you are effectively relying on the honestly and integrity of the entire chain of previous owners.
Apart from having in my contract with the seller the appropriate clauses that no finance was outstanding I actually asked the seller to prove what they had told me when I asked how they financed the boat. In the end they shared their bank statements with me as evidence just before I transferred the main sum.
As I bought my boat through a finance company I asked them to run checks for me, but I felt that these would not have really provided me any real security.
I do feel that for 2nd hand boat purchases some form of consumer protection should be available as today there appears to be none and you are effectively relying on the honestly and integrity of the entire chain of previous owners.
ari
Well-Known Member
I didn't know one individual could credit check another individual, I thought only companies (offering credit) could do that, or an individual credit check him/herself.
How can one do that and what information can be obtained?
ari
Well-Known Member
Couldn't agree more, but there was a huge discussion about it a little while ago and the general consensus seemed to be that most felt it just wasn't necessary...
It's here if you fancy a wade through all the arguments!
http://www.ybw.com/forums/showthread.php?t=219476
jfm
Well-Known Member
I agree the available data is more limited but I believe CCJs are in the public domain so you can find out if a person has a CCJ recorded against them. I think I did this for MapisM about a year ago, on a UK private individual
Things like 192.com will help you decide if an address is real or if there's another address, in general and when doing your CCJ search
etc etc
ari
Well-Known Member
Ah, ok, that makes sense I guess. Not much point in CCJ's if people can't find out about them.
But presumably therefore the info that's normally available via a credit report isn't accessible?
But presumably therefore the info that's normally available via a credit report isn't accessible?
