When purchasing a used boat it is important that the legal and financial processes are handled correctly.
ABYA registered yacht brokers are professionally qualified and as a requirement of membership must also carry professional Indemnity Insurance, operate specifically designated client accounts and follow the ABYA Code of practice.
Unlike a property transaction where an agent will market the property and then hand over to conveyancing solicitors after acceptance of an offer, the ABYA yacht broker continues with the conveyancing until completion.
He or she will ensure the distribution of final funds are handled correctly and that the boat’s title history, record of mortgages (if part 1 registered) and RCD and VAT status evidence have been requested, as well as administering the sale and purchase contracts and legal transfer of title.
The purchase is made by using an unconditional or conditional Sale & Purchase agreement. Buying a yacht this way can be less stressful than the current English system of property buying, as everything is agreed in writing at the beginning. Once an offer is accepted and a deposit is paid, the yacht is then essentially off the market. At that point, no other offers can be accepted whilst the agreement is in place.
The usual sequence of events for a conditional sale are set out below:
It all works very well for both parties. The seller knows he has a committed buyer and financial protection. The buyer has time to find out exactly what he is buying and the knowledge that any money he spends on surveys will not be wasted by the boat being sold elsewhere during the process. There is a clear written framework, with a professional yacht broker as a third party to administer it, and a safe method of distributing the funds. It is also possible to use an unconditional contract if not having a survey or to insert an optional seatrial clause.
Although ultimately it is for buyers to satisfy themselves on the title history and VAT and RCD status of a used vessel, John Rodriguez Yachts will request paperwork or details on all listed yachts with regard to VAT status, RCD status and Title history paperwork and present these findings as a matter of course to a prospective purchaser.
The ABYA Code of practice requires that all deposits and final payments are processed through a dedicated client account solely for this purpose. The John Rodriguez Yachts client account conforms to this requirement and is written in trust at Lloyds.
When transacting through client accounts and/or to vendor and purchasers accounts, suitable identity should always be obtained and a two-step process should be in place. John Rodriguez Yachts will never ask clients to change bank account details via email.
It is also a requirement that all ABYA brokers carry professional indemnity insurance and John Rodriguez Yachts is fully insured.