Our glossary page
contains a brief description of the terms most commonly used in our web
site and within the marine industry. The information provided is
intended to be general in nature and may be subject to various
interpretations depending on the application or setting in which
invoked. The terms may also acquire different meanings when applied to
other industries.
• Vessel Title
Advisor - Answers to all of your vessel documentation
and boat registration questions.
• Bookmark
- Save this page to stay current with the latest additions and
updates
Abstract
of Title:An indexed ledger, maintained by the
U.S. Coast Guard, that contains a history of all ownership and lien
transactions from the time a vessel is initially documented.
A chronological series of documents that have
been derived from a state's microfiche records reflecting all state
titling transactions. Admeasurement:The Process of factoring a
vessel's dimensions in order to determine its tonnage. Determines
whether the vessel is large enough to qualify for documentation. See
"Certificate of Admeasurement".
Admiralty Law: The body of laws governing maritime activities.
Administered under the jurisdiction of Federal District Courts. Also known as "Maritime
Law".
Affidavit
of Lost Title: A form the legal owner executes to certify that
a title certificate has been lost. May also serve as a release of
interest.
Standard form with most state titling agencies.
Affidavit
of Repossession: A certificate the legal owner or mortgagee executes to
certify that a repossession has taken place. Required by most
governmental titling agencies as evidence that a vessel has been foreclosed upon.
Requirements for the contents and citations may vary depending on the titling jurisdiction.
American Vessel Documentation
Association: A professional trade association
consisting of privately owned companies throughout the country that
provide vessel documentation services. Also referred to as "AVDA".
Attorney
in Fact: See "Power of Attorney"
Authorization
for Payoff: A written directive from the borrower to the lien holder that
authorizes a third party payer to submit loan pay-off funds on the
borrower's behalf. Usually directs the lien holder to forward all lien releases or title
documents to the third party payer.
AVDA: See "American Vessel
Documentation Association".
Bareboat
Charter: A rental or lease arrangement wherein the lessee operates the
vessel independent of its owner. Generally not considered as commercial
usage by the Coast Guard when operated exclusively for pleasure cruising.
Barge:
A vessel that has no self-propulsion and is towed or propelled by another
vessel. May be used for either commercial or residential purposes.
See "Houseboat".
Bill
of Lading: The receipt a carrier gives to a shipper for transported goods.
Evidences the contract between the shipper and the carrier. Can also
serve as an interim document of title among the shipper, carrier, and
recipient.
Bill
of Sale: A form the seller executes to evidence transfer of ownership to the
buyer. Identifies the vessel, usually contains title warranty language, and
states the consideration paid. Requirements for content and citations may vary among various governmental
titling agencies.
Blue
Book: The term applied to Canadian and British certificates of vessel
registry. This term is derived from the blue hard cover that encases the
registry certificate.
Boat:
See "Vessel".
BUC
Guide: A publication used throughout the industry that contains values for
used vessels. Also contains vessel specifications and information about
manufacturers.
Builders
Certificate: A certificate issued by a vessel manufacture that serves as
the initial title document. Identifies the first owner and contains the
vessel's specifications. Also known as "Certificate of Build" or
"Builder's Certification". This certificate meets Coast Guard requirements
for initial documentation. Supersedes the former term known as "Master
Carpenters Certificate".
Certificate
of Admeasurement: A form required by the
Coast Guard for vessel documentation that established a vessel's
tonnage. See "Admeasurement".
Certificate
of Documentation: A certificate issued by
the Coast Guard which serves as evidence that a vessel is
documented. Provides internationally recognized proof of ownership.
Shows all trade endorsements. Must accompany the vessel at all times.
Certificate
of Ownership: A certificate issued by the
Coast Guard that identifies the current owner of record and all
outstanding recorded liens. Does not show a complete history of all
recording transactions. See "Abstract of Title".
Class
"A" Title: A state title
certificate that cites the registered owner and usually states any secured
lien-holders or "legal owners".
Class
"B" Title: A state title
certificate that cites the registered owner, but does not usually identify
secured lien-holders. Serves as a transitional title pending issuance
of a "Class A Title". Used mostly in states that are converting
from a "registration only system" to a title system".
Closing:
The process in which the buyer exchanges considerations with the seller
for ownership of a vessel. The final action in a sales transaction.
Closing
Agent: The third party appointed by a
buyer and seller to administer a closing. Usually a yacht broker,
title company, attorney, or marine lender.
Closing
Date: The date a buyer and seller have
agreed upon as the final time by which the sale must be closed. The date a
vessel sales transaction was consummated.
Closing
Exception: An authorization from the
seller or buyer that allows the closing agent to proceed with a closing
regardless of certain deficiencies.
Closing
Statement: A form that lists all the
financial details of a closing transaction. Prepared by the closing agent
prior to or at the time of closing.
Coastwise
Endorsement: A qualification that
allows a documented vessel to engage in the transportation of passengers
or freight between U.S. ports. Must be shown on the "Certificate of
Documentation".
Co-brokerage
Arrangement: An arrangement wherein a
listing broker and selling broker cooperate in selling a vessel. Usually
entails a pre-arranged commission split.
Commercial
Vessel: A vessel that engages in
activities such as carrying passengers, transporting cargo, and commercial
fishing operations. Coast Guard documentation with the proper endorsements
is required for these activities.
Deed
of Gift: An instrument that conveys
interest in a vessel where there is no dollar consideration given. The consideration
is often stated as "gifted" or "for love and
affection".
Dinghy:A small auxiliary vessel used as ship to shore transportation for a
larger vessel. Usually carried or towed by the mother vessel. Term often
confused with "Tender".
Document
Number: A unique number issued by the
Coast Guard for every documented vessel. Must be permanently affixed to
the inside of the vessel's hull. Also commonly known as an
"Official Number".
Documentation:
A term used to collectively describe the U.S. Coast Guard vessel
documentation system and application process.
Documentation
Company: A private business that prepares
documentation forms and provides assistance regarding all aspects of
vessel documentation.
Documented:
A vessel is said to be "documented" when it carries on board, a
current and valid "Certificate of Documentation".
Encumbrance:
A lien or claim against a vessel that is usually of a contractual nature.
Excise Tax: A yearly assessment for the
privilege of operating a vessel on a particular state's waters. Usually
paid at time of initial or yearly state vessel registration. Often
confused with "Sales Tax" or "Use Tax".
Exclusive
Listing: A listing arrangement wherein the
owner grants exclusive selling rights to a broker or dealer.
Extra-Judicial
Foreclosure: See "Non-Judicial
Foreclosure"
Factory
Hull Number: See "Hull
Identification Number".
Fisheries
Endorsement: A qualification shown
on a "Certificate of Documentation" allowing a documented
vessel to engage in commercial fishing activities.
Fleet Mortgage: A preferred mortgage
that grants a security interest in multiple vessels to the mortgagee as
collateral for a single loan. Allows for a separate vessel discharge
without affecting others covered by the mortgage.
Floating Home: A
residential structure which is constructed on a platform supported by
flotation devices. May be titled as a vessel or designated as a fixture to
the wetlands property on which it is moored.
Foreclosure:
The overall process of liquidating the collateral or vessel secured by a
marine loan upon default of the terms. Includes the process of
physical repossession.
Foreign
Registry: A foreign government's federal
vessel registration system. Similar to Coast Guard documentation.
Hailing
Port: A city and state designation that
must be marked on every documented vessel. Term often confused with
"Home Port".
Haul
Out: The process of removing a vessel from
the water for repairs or a survey inspection. Usually ordered to
facilitate an external hull inspection by a marine surveyor. Required on
larger vessels by most marine lenders.
Home
Port: A designation previously
required by the U.S. Coast Guard to designate the office in which the
vessel records were kept.
House Barge:A living structure situated on a rectangular hull which
is not self-propelled.
Houseboat:
A self-propelled cruising vessel with a rectangular
superstructure situated on a displacement hull.
HIN:
See "Hull Identification Number".
Hull
Identification Number: A unique number
assigned to each vessel by its manufacturer. It contains encoded
information about vessel's length, build date, etc. Usually embossed into
the vessel's stern. Also known as "Factory Hull Number".
Hypothecation
Agreement: An agreement that pledges
a vessel as security for a loan without turning over actual
possession. Usually executed by a vessel owner who is not an actual
party to the loan transaction.
Import
Broker: A private business that
specializes in providing assistance for importing and exporting vessels.
IMO Number: Ship
identification number scheme for the International Maritime Organization.
In
Rem: A legal term indicating that the
claim or action is against the vessel itself instead of the owner as an
individual. Under Admiralty Law, certain claims against a vessel are
considered to be "in rem" and will follow the vessel regardless
of changes in ownership.
Joint
Tenants: A type of vessel ownership by two
or more parties having an undivided interest and equal right to usage.
Also commonly referred to as "joint tenants with right of
survivorship".
Legal
Owner: A party listed on a state title
that has a perfected security interest in the vessel. Same as
"Registered Owner" when there are no perfected security
interests in the vessel.
Licensing
Sub-agency: A private business chartered
by a state to conduct titling and registration activities on the state's
behalf.
Lien:
Any claim or encumbrance against a vessel. See "Encumbrance",
"Maritime Lien", and "Perfected Interest".
Limited Liability Company: A relatively
new form of business ownership that has the characteristics of both a
corporation and a partnership. Also known as an "LLC"
Listing
Agreement: A contract between a seller and
a broker giving the broker either exclusive or non-exclusive rights to
advertise and represent the vessel for sale. The seller usually agrees to
pay the broker a commission upon the sale of the vessel.
Listing
Brokerage: A brokerage firm
that holds the listing agreement with the seller.
Manufacturer's
Statement of Origin: A certificate
issued by a vessel manufacturer that is viewed by a state as the initial
title document. Contains vessel specifications, build date, and
identification numbers. Also identifies the first owner. Commonly
known as an "MSO".
Maritime
Law: See "Admiralty Law".
Maritime Lien:
With reference to vessels, the term connotes the right to have a debt or
obligation satisfied out of the vessel itself.
Markings: A vessel's name and
hailing port as marked on the exterior of the vessel. Required on
documented vessels.
Marshal's
Bill of Sale: A bill of sale issued
by a federal marshal for a vessel sold at a marshal's auction. Issued
pursuant a federal court order authorizing such action.
Master
Carpenter's Certificate: An obsolete
initial title document that has been replaced by the "Builders
Certificate".
Mortgage
Amendment: A supplementary agreement
that changes the terms of a previous mortgage. Must meet certain
requirements to qualify for Coast Guard recordation.
Mortgage
Assignment: A supplementary
agreement that assigns a previous mortgage to a different mortgagee. Must
meet certain requirements to qualify for Coast Guard recordation.
Mortgagee:
The party to whom a preferred vessel mortgage is granted. Usually amarine lending institution.
Mortgagee
Consent: A written consent from a
mortgagee that is required by the Coast Guard to make a change in the
vessel's documentation status.
Mortgagor:
A vessel owner who grants a mortgage to a lender for the purpose of
perfecting the vessel as collateral.
Motor
Yacht: The term usually applied to
larger mechanically powered non-trailerable vessels. A
mechanically powered luxury vessel.
NADA
Guide: A periodic publication that lists
vessel values and specifications. Also identifies various manufacturers.
National
Vessel Documentation Center: The Coast
Guard facility that administers all matters pertaining to vessel
documentation.
Non-exclusive
Listing: A listing agreement with a yacht
broker that allows the seller or another brokerage to also concurrently
market and sell the vessel.
Non-judicial
Foreclosure: The process of
foreclosing upon a vessel without court action. Also known as
"Summary Foreclosure" or "Extra-judicial Foreclosure".
Notice
of Claim of Lien:A written claim that is unilaterally filed by the claimant against
a documented vessel.
Paperless
Title: A state title that is maintained on
state computer records only. Normally issued only when there is a
legal owner.
Pay-off
Demand: A statement provided
by a lien-holder that indicates the amount required to retire a loan.
Usually cites a "per diem" interest amount and a destination
address for the pay-off.
Perfected
Interest: A security interest in a
vessel that has been properly recorded with the appropriate governmental
recording agency. Loan is said to be "perfected".
Personal
Property Register: The Canadian
equivalent of a Uniform Commercial Code filing.
Personal
Property Tax: A state or county tax
that is periodically levied against a vessel. Usually based on the
vessel's value.
Pleasure
Vessel: A vessel that is used
solely for pleasure purposes with no commercial activity. Also known as a
"Recreational Vessel".
Pocket
Listing: An informal or verbal
agreement where a seller agrees to pay a commission to a broker for
finding a purchaser for the vessel. Similar to a "non-exclusive
listing".
Power
of Attorney: A written instrument
that appoints an agent or "Attorney In Fact" to perform
designated functions on behalf of the principal. May be general or
specific in nature.
PPR:See "Personal Property Register".
Preferred
Vessel Mortgage: An instrument that grants a
priority security interest in a documented vessel. Must be duly recorded
with the U.S. Coast Guard in order to gain preferred status. Optimal
method for perfecting a security interest in a vessel.
Provincial
Licensing: A simplified form of
vessel registration issued by a state or province in a foreign
country. Although normally not an actual title document, often
viewed as proof of ownership.
Purchase
Agreement: An agreement between a
buyer and seller that states the terms and conditions under which a vessel
sale is to be transacted. A "Purchase Offer" that has been
accepted by the seller. Also known as a "Sales Agreement".
Purchase
Offer: An instrument containing the terms
and conditions of an offer to purchase that is presented to a vessel
seller. Defines the amount of the offer, a deadline for acceptance, any
contingencies, and the terms for closing. Often becomes a "Purchase
Agreement" upon acceptance by the seller.
Recording
Confirmation: A statement indicating that
a preferred mortgage or other recorded instrument has been correctly
posted by the appropriate governmental agency. Usually issued by a title
or documentation company.
Recreational
Endorsement: A certification on a vessel's
"Certificate of Documentation" indicating the vessel may be
operated for pleasure usage.
Recreational Vessel:
See "Pleasure Vessel"
Registered
Owner: The party listed on a state title
that is entitled to possession of the vessel. Same as "Legal
Owner" when there are no perfected security interests against the
vessel.
Registration:
See "State Registration".
Registry:
The term commonly applied to foreign vessel registration systems. See
"Foreign Registry".
Registry
Endorsement: A qualification shown on a
certificate of documentation that allows the vessel to carry passengers or
freight between U.S. and foreign ports.
Release
of Interest: A form executed by an owner,
lender, or any other party having an interest in a vessel. Releases all
claims against the vessel by the executing party. Standard form used
by various states.
Repossession:
The physical act of arresting or recovering a vessel that is subject to a
loan foreclosure. Term is often confused with "Foreclosure".
Reserve:Funds held in trust by the closing agent to cover certain
contingencies after the closing has occurred.
Runabout:A term generally applied to smaller vessels
which are carried on a trailer.
Sailboat:A vessel that uses a sail or sails as its primary propulsion.
Sales
Agreement: See "Purchase
Agreement".
Sales
Tax: A state tax that is levied on
the retail sale of a vessel. Usually collected by a broker or
dealer. Often confused with "Use Tax".
SAMS:An acronym for"Society of Accredited Marine Surveyors. A nationwide
organization of professional marine surveyors.
Satisfaction
of Mortgage: A form used to release
a mortgage recorded against a documented vessel. Must meet Coast Guard
requirements for recording.
Selling
Broker: The brokerage company that
administers the sale of a listed vessel. Usually represents the buyer in a
co-brokerage arrangement.
Ship:Term commonly applied to a
large commercial vessel that is used for shipping goods or carrying
passengers.
Ships Mortgage: See
Preferred Vessel Mortgage
Ships
Mortgage Act: Federal legislation
enacted in 1920 allowing marine lenders to obtain a preferred security
interest in Coast Guard documented vessels. Applies to both pleasure and
commercial vessels that are documented.
Six-pack:
A commercial activity in which a vessel carries six or less passengers for
hire. Usually pertains to a sport fishing activity.
Skippered
Charter: A charter arrangement were
the vessel is operated or "skippered" by the owner.
State License:
See "State Registration Certificate".
State
Registration:A certificate that is issued annually by a state upon receipt of
taxes and fees. Usually accompanied by colored "Stickers" or
"Tabs"
State Registration Decals: Colored
decals issued by a state upon payment of a yearly registration fee.
Usually accompanied by a "State Registration Certificate". Must
be displayed on the vessel whenever underway. Also known as
"Tabs" or "Stickers".
State Registration Fees: The
collective taxes and fees required to renew or initially place a vessel
into state registration.
State Registration Number: A unique
number assigned by a state for every registered vessel. Each state has a
unique registration number prefix. Must be affixed to all non-documented
vessels.
State Stickers: See "State
Registration Tabs"
Subordination Agreement: An
agreement where the mortgagee allows another lender's mortgage to acquire
priority, even though subsequently recorded. Must meet Coast Guard
requirements for recording.
Survey:An inspection performed by a marine surveyor that describes the
condition of a vessel and defines its value. May be performed either
in the water or during a vessel haul-out.
Tax
Lien: A claim or encumbrance against a
vessel for the unpaid tax obligations of the owner.
Tenants
By The Entirety: A type of ownership
dependant on marital status. Usually the same as joint tenancy while the
marriage remains in force. Upon severance of the marriage, ownership
reverts to a tenancy in common.
Tenants
In Common: A type of ownership where two or more
parties hold separate interests in the vessel but have equal right of
usage.
Tender:
A small auxiliary vessel used to tend fishing nets and other floating
gear. Used as auxilliary support for a commercial vessel. Often
confused with a "dinghy".
Title:
A certificate issued by a governmental agency that evidences vessel
ownership. The term is usually associated with a state issued title
certificate. Often confused with "Registration".
Title
Company: A full service company that
provides all types of vessel documentation and
state titling.
Title
Report: A comprehensive document that
identifies a vessel's specifications, current owners, and recorded liens
or encumbrances
Trade
Endorsement: A qualification that allows a
documented vessel to engage in certain types of commercial activities.
Usually shown on the "Certificate of Documentation".
Trade
Restrictions: Restrictions placed upon a
documented vessel when it is not qualified to engage in certain commercial
activities. Usually arise as a result of foreign build or break in the
chain of recorded ownership.
Uniform
Commercial Code Filing: A method of
securing interest on non-titled and non-documented vessels. Usually filed
and recorded on the state level, but may be filed at the county level in
some states.
United
States Coast Guard: A branch of the
federal government that enforces maritime regulations. Administers all
vessel documentation activities. Also referred to as "USCG" or
"U.S. Coast Guard.
USCG:See "United States CoastGuard".
Use
Tax: A tax that a state levies
against a vessel upon its first usage on state waters. Use tax does not
apply if retail sales tax was paid when the owner purchased the vessel. It
is often confused with "Sales Tax".
Vessel:
Term associated with any object that traverses a body of water.
Vessel
Documentation Office: The U.S. Coast Guard
office that administers all documentation activities. See "National
Vessel Documentation Center".
Vessel
Information System: A computer database
administered by the U.S. Coast Guard that compiles vessel ownership and
lien information for all vessels nationwide whether documented or state
titled. System is currently under development. Also known as "VIS".
Yacht:A luxury vessel used mostly for pleasure purposes. This term is
applied to vessels that are propelled by either power or sail.
Yacht
Broker: An individual salesperson who brings a buyer and seller together
and assists with the sale. In certain states this is an individual
licensed to supervise other vessel salespersons.
Yacht
Brokerage: A business that employs vessel salespersons or brokers. It
acquires vessel listings, advertises and promotes such listings, and
derives its revenue from commissions earned there from.
Yacht
Dealer: A business that sells new and used vessels, either directly from
the factory or from its own inventory. Many yacht dealers also offer
brokerage services.
