If you're buying a boat where the sum is a bit more than you'd do a cash deal for, and the boat will have to sit where it is until transportation can be arraigned, how do you set up the deal so both parties are protected? The only cars and boats I've ever purchased are ones where I forked over cash and drove/towed away. Any issues I should be aware of, particularly boat related?
The advice to use an escrow is spot on. Make sure the agreed escrow instructions are not just easy to understand, but are impossible to misunderstand and that they address all contingencies and possibilities. (Don’t just use some template or form- think it through and make sure it will be abundantly clear what happens with title and money and by when that happens, who does what, etc.)
If the boat is US Documented, order an Abstract from NVDC before closing and study it carefully to make sure you know and understand what is of record. Realize however that whether or not the boat is US Documented, liens and encumbrances on boats do not have to be recorded anywhere; I.e., they can be enforced under admiralty law in an in rem action (against the vessel herself) in federal court even against a good faith purchaser for value so long as the suit to enforce the claimed lien is filed timely, i e before the lien has expired — again, even if the boat is not US documented (or if it is, even if a Notice of Claim of Lien was never recorded with the NVDC, because maritime liens arise automatically as a matter of law and require no recording or other notice, until/except for the filing of suit in federal court to enforce them). Consequently, it is very important to require in the purchase and sale agreement an express warranty that there are no liens or encumbrances against the vessel (other than ones disclosed, in which case they should be listed specifically in the agreement), and an indemnity and hold harmless from the seller as to any such undisclosed liens or encumbrances. If the seller balks, run don’t walk to the nearest exit.
