Buying a yacht begins with an offer to purchase. The offer is presented to the seller of the yacht on a legal document called a Purchase and Sale Agreement. Print out a copy and familiarize yourself with the wording. The Purchase and Sale Agreement used by professional yacht brokers in Florida was developed by the Florida Yacht Brokers Association for their members. This agreement has been re-written several times over the years under the guidance of maritime attorneys as a service to the association members.
Your broker will complete the Agreement following your instructions. When working directly with the selling broker he or she will guide you through the process. The document will include your name or your company name, the name of the seller, the offer price, the required ten percent deposit and relevant dates. The offer may include contingencies such as surveys, sea trials, and financing.
Ensure that the listing or description of the vessel is included as an attachment to the Agreement. This will prevent any misunderstandings regarding the inventory included in the sale when you take delivery. The importance of this step will become evident to you when you collect your new boat after closing only to discover that the dock lines that you thought were part of the deal are not yours to take and you have no way of tying up when you get her home.
Every page of the Purchase and Sale Agreement provides for the signatures or initials of both parties. This includes the attachment with the inventory of the vessel.
The Agreement will clearly state that the seller must respond to your offer by a date determined by you. You will likely receive a counter to your offer price from the seller. If the seller does not respond by that date the offer is considered void.
When you and the seller are able to agree on a price for the yacht the Purchase and Sale Agreement is signed by both you and the seller. Deposit funds are wired into your broker’s escrow account and the Agreement becomes a legally binding document. The seller must take the boat off the market until you either accept or reject the vessel. Most sellers will insist that the requirements of the Agreement be completed within three to four weeks of an accepted offer.
In my next article you will learn what is expected of you after your offer price has been accepted. Feel free to call me at (954) 614-1663 if you have any questions. Or send me an email. I typically respond to my messages and email within one to two days.
See you on the dock!