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LEGAL FORMS
BACKGROUND REPORTS
BOAT WEAR ONLINE
BOATER EXAM
VESSEL RECORD SEARCH
VESSEL TITLE SERVICES
BOAT TRANSACTION FORMS |
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Please read our terms of use before proceeding. Please submit an advisor request if your question is not listed above.
Do
I need a regular or maritime attorney for legal advice?
- It all depends on the kind of transaction your are
considering and the
situation at hand. In dealing with state level issues on a smaller boats, a regular
attorney may be quite sufficient. On Coast Guard documented vessels
or those which will be used in commercial operations, a maritime
attorney would likely be your better choice. In any event, you
should ask a prospective attorney whether he or she is qualified in your particular area of
interest. If not, you can request a
recommendation or check the marine attorney listings on our directory page.
Do
I need a regular or maritime attorney for legal advice?
- It all depends on the kind of transaction your are
considering and the
situation at hand. In dealing with state level issues on a smaller boats, a regular
attorney may be quite sufficient. On Coast Guard documented vessels
or those which will be used in commercial operations, a maritime
attorney would likely be your better choice. In any event, you
should ask a prospective attorney whether he or she is qualified in your particular area of
interest. If not, you can request a
recommendation or check the marine attorney listings on our directory page.
Should
I state title or Coast Guard document my boat? -
Coast Guard vessel documentation is optional unless you intend to
use your boat commercially or your lender requires this for loan
security purposes. In fact, most vessels under 25' in length will
not qualify for documentation anyway. Keep in mind when making your
choice that a documented boat can not also have a state title.
However, some states require that documented vessels become
registered. Information on the advantages of documentation can be
found in the Coast Guard documentation section of our Vessel Title
Advisor.
What are
boat operating or vessel travelling papers? -
Boat operating or travelling papers are copies of documents proving
that you own the boat. This may include a signed off state boat
title, a bill of sale, or other evidence that the title or Coast
Guard documentation has been assigned into to your name. In most
cases, such papers will also include evidence that you have applied
for a new registration, state title, or Coast Guard documentation.
These may also be supported by a letter from your title or
documentation service agent when applicable. Although such items are
not fully legitimate for operating purposes,
most law enforcement officials will honor them if they are
complete and reasonably current. However, you should always check
with the enforcement agency for the area in which you will be
operating to confirm whether these will suffice.
What is a vessel or
boat paper trade? - Many states
allow a reduction in sales or use tax on a vessel purchase for the
value of a trade vessel. This has created a tendency among some
buyers to arrange for passage of title for a trade through the
seller and then on to a third party as evidenced only by bills of
sale. The buyer maintains control and possession of the trade
pending delivery to the third party. Buyer's should be aware that
such tax deductions can be disallowed should the respective state
not view this as a bona fide transaction. Sellers should also be
concerned about stepping into the chain of ownership, even if it is
only on paper.
When
do I need the services an attorney? -
Maritime transactions are quite different from those involving other
types of personal or real property. You should accordingly seek the
advice an attorney whenever you do not fully understand the
workings or implications of any particular situation or boat
transaction. An attorney can also help address those unfortunate
circumstances where title defects exist, prior liens
were not properly retired, or the title transfer documents are insufficient.
Where can I find marine boat
or vessel escrow services?
- In the marine industry, you are not likely to find the
equivalent of typical real estate escrow services. Boat or vessel
escrows are for the most part
handled by yacht brokers, commercial lenders, a few documentation
companies, and the
occasional attorney who is willing to become involved in such
transactions. Other than attorneys and commercial lenders, there is very little by way of
bonding, accountability, and governmental oversight with respect to
the way marine escrows are handled. Brokers are regulated in some
states, but documentation companies are usually not subject to any such
constraints. You should accordingly conduct a great deal of
investigation before handing large sums of purchase funds over to an
independent marine escrow agent.
Who guarantees a
boat or vessel title? - In most cases, it is the
seller who represents that a boat or vessel title is marketable and
free of any liens or encumbrances. This is usually supported by a
written statement of title warranty on a boat bill of sale or vessel
purchase agreement. Although yacht brokers, marine attorneys, and
documentation or marine title companies may assist in verifying such
items, they will not typically assume the responsibility of ensuring
the title. Vessel title insurance may afford the best option for
buyers when looking for protection against title defects, hidden
liens, and other transactional deficiencies.
Why
is my lender requiring Coast Guard documentation? -
Most vessels larger than 24' will qualify for Coast Guard
documentation if the owner is a U.S. Citizen. In this case, the
lender must become secured with a preferred vessel mortgage in order
to fully protect their collateral interest. In order to record the
mortgage, a vessel must be currently documented or in the process
of becoming documented in the borrower's name. |
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The words "caveat emptor" represent what is arguably one of the
most important concepts a buyer should bear in mind when purchasing a
vessel. This Latin phrase, which means "let the buyer beware",
is further defined in legal terms as "an axiom or principle in
commerce that the buyer alone is responsible for assessing the quality of
a purchase before buying". In the marine industry, this is true not
only as it pertains to a vessels condition, but also as it relates to
the quality its title.
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Boat Titling Glossary |
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With respect to
vessel liens and encumbrances, it is natural to think only in terms of
an owners indebtedness to a lien-holder. However, in the event of a
settlement, the lien-holder actually incurs a converse obligation to the
debtor in the same amount as the original debt. In order to fulfill this
obligation, the lien-holder must offset any recorded claims it may have
filed against the vessel. Furthermore, there are certain state and
federal regulations that require lien-holders to implement this in a
timely manner. In fact, the holder of a preferred marine mortgage on a
documented vessel can incur substantial civil penalties for not
recording a discharge upon payment.
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Boat Titling Glossary |
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One
of the more important aspects of a surveyor's report pertains to the
vessel's description. Although often underrated, this can be as vital to
the buyer and marine lender as the vessel's underlying condition. In
addition to the exact specifications, any identification numbers that are
affixed to the vessel must be clearly stated. Such items
all serve to link the vessel itself with those documents
which evidence ownership and
a lender's security interest.
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Boat Titling Glossary |
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