Last fall, we ran a feature story about the many features, characteristics and tasks that make great brokerages great — an A-to-Z accounting of what they should offer. What follows is a selection from that story in our August 2015 issue.
Dual agency deals need to be transparent. A yacht sales professional can represent both the buyer and the seller in a transaction in most states. It is the obligation of the listing broker to operate in the best interests of the person who is paying the commission — the seller — unless the broker states up front that she is representing both parties. In high-dollar purchases, the buyer can be protected by using the services of a buyer’s broker. There is a fiduciary responsibility to the buyer and the seller, and full disclosure is key.
Justice for problems depends on your broker’s standing and accreditation. Buyers and sellers who use a Certified Professional Yacht Broker (CPYB) can have the confidence their yacht sales professional is highly competent and abides by a strict code of ethics.
Signatures, signatures, signatures! If the buyer and seller agree to the offer to purchase or to renegotiate in the form of an addendum, the terms of that renegotiation must be put in writing by both parties and signed by both parties with signatures from all involved. This is done by a conditional acceptance or addendum to the original purchase and sale agreement, just like in a home purchase. If the additional signatures aren’t there, and the deal goes to court or arbitration, then the agreement may be invalid because it wasn’t fully executed.
Valid purchase and sale agreement is crucial. A purchase and sale agreement is only valid if signed by both the buyer and seller. Often it is signed by the buyer, then goes to the seller for a signature, but if the seller doesn’t sign or return it, it is not a legitimate contract in the eyes of the law. Not a big deal if the transaction is smooth, but if there is a hiccup — say the seller defaults — there is no recourse for the buyer, because it’s not a contract.
Who pays for what? Boilerplate forms cover every aspect of the transaction, but where the yacht sales professional really shines is in the additional provisions section. Here’s where she helps the provision clearly state that when the boat is launched/hauled out for survey, the buyer will pay for the launch/haulout. And if the boat is rejected, the seller pays to have it put back on land. These points, and potentially many others, need to be clarified based on the boat’s condition.
Your yacht transaction professional team is operating in your best interest. Their heads are involved, not their heart. Your broker, marine surveyor, lender, insurance agent and mechanic sometimes have their best advice ignored by buyers, who feel the pressure to close a deal because it’s “too good to be true.” Listen to your team, not your heart.