Buying a boat is an exciting process. After you’ve invested time into researching the make and model that works best for you, test driving different new or used boats, and making your final decision, you are likely ready to complete the purchase and get your new vehicle out on the water. However, the process isn’t as simple as paying cash and driving off with your new boat. There are important pieces of documentation that should be prepared and thoroughly looked through before completing the transaction. Learn more about the documents that you need to have ready from Diverse Offerings Finance and reach out today for more information.
What Documents Should You Prepare in Order to Buy a Boat?
Bill of Sale
One of the most crucial bits of paperwork that you will need when purchasing a boat from a private seller is a bill of sale for each party involved in the transaction. A bill of sale is a legally-binding document that records the transfer of ownership of an object (or in this case, vehicle) from the seller to the buyer through a financial exchange. This should include the type of boat, its size, the registration information, and purchase price. A few other crucial bits of information to include are the form of payment from the buyer, any extra equipment included with the sale, and the signature of the involved parties. This document ensures that the transfer of ownership took place and you are the new legal owner of the boat.
Certificate of Title & Chain of Title
Much in the same way that a bill of sale ensures that the transaction made when purchasing a boat is legally binding between both parties involved, a certificate of title does something similar regarding ownership. The title for the boat is a legal statement from a title company or an attorney that states that you are now the current owner of the craft. Getting this is important because it covers your back if there were ever to be any discrepancies regarding the fact that you are the new owner. Additionally, you should make sure that you are going to be getting a chain of title, showing the information of every dealership or owner that the boat has had throughout its lifespan.
In any private transaction regarding the purchase of a new or pre-owned boat, an initial contract should be prepared and signed by the buyer. This is essentially a contract that is signed in good faith so that the seller can be sure that the buyer actually intends on purchasing the boat if everything goes well. An initial contract should include the time allotted for lender approval, the delivery method of the vessel, whether the buyer or seller risks loss between signing and delivery, and the limits of any warranties on the boat. This should come alongside a good faith deposit equating to a certain percentage of the selling price and be signed before a surveyor’s inspection and/or sea trial.
Once the sale is nearing its conclusion and both parties have agreed on the terms of the transaction, the state of the vehicle, and have had a thorough surveyor’s inspection performed, the buyer must ensure that they are receiving all applicable documentation that will allow them to register the boat in their name (usually required in under a month). For the most part, the buyer is going to need to go in prepared with their new proof of ownership, the mutually signed bill of sale, information regarding the vessel (year, make, model, length of the boat), and proof of payment of any applicable registration fees. Additionally, if you are purchasing a brand new boat, a manufacturer’s statement of origin will likely be required to complete the registration process.
The process of buying a boat isn’t terribly complicated. However, it is important from a legal perspective that you have prepared and received all of the documentation necessary to ensure that you are the new owner of your boat, the state it was in at the time of the purchase, as well as any other paperwork that you will need to register the vessel under your name going forward. If you have any questions regarding the documentation you should prepare prior to purchasing your new or pre-owned boat, reach out to the trusted team at Diverse Offerings Finance today!