To re-surveyed or not?

[adventure seeker]

A boat I was looking at, someone got to first. After a survey and sea trial there were a few deficiencies and the seller will not budge on the price, the buyer wants a reduction in price..... the same old story going on for several days now.
The broker shared with me the list of deficiencies, all of which seemed pretty minor. Broker asked me if it falls through would I want it.
Would it be necessary to re-survey if I had a copy of the one that was just done?

 

[Comodave]

Most likely you will need a survey of your own unless the other buyer will sell you his. Your insurance company will almost certainly want a recent survey and also if you get a loan the mortgage company will want one too.

 

[bgillroy]

Typically the deficiencies would be fixed by seller in event price wss to remain unchanged. You'll need your own C&V unless a cash deal ( your cash) and you go uninsured.

 

[DDW]

In that situation I'd be tempted to talk to the same surveyor and see if he would give you a big discount on another one which you could call your own. All he has to do is hit "print" again, though he might want to spend 10 minutes on the boat to make it look good. If no discount, then definitely don't use him, because you already have the benefit of his expertise, and every surveyor will notice different things.

 

[PM]

Who paid for the first survey? If it was anybody other than you, consider it biased in one way or another. Now is not the time to try to save a few hundred.

pete

 

[Seevee]

In that situation I'd be tempted to talk to the same surveyor and see if he would give you a big discount on another one which you could call your own. All he has to do is hit "print" again, though he might want to spend 10 minutes on the boat to make it look good. If no discount, then definitely don't use him, because you already have the benefit of his expertise, and every surveyor will notice different things.

Totally agree, no need for another survey. Get it above or ask the former buyer.

 

[BruceK]

Difficult question.If you use the existing survey you have no contract with him and cannot sue him if he missed things and it costs you $. On the other hand most Survey reports try to exclude surveyor liability anyway.
There is value in being there for the survey. 2 surveys may be better than one. I think I`d get my own and wheedle all I could about the first one from the Broker.

 

[slowgoesit]

Good point on NOT using the same surveyor unless you get a SUBSTANTIAL discount on the survey. If I'm going to have to pay 75% or more of the new survey cost, I'll hire someone else, who as stated, will probably find some additional items based on his experience. Then again, unless the asking price is a REALLY good deal, I'd probably be offering a little less on the boat based on the items that you already KNOW need to be fixed. Unless you are already committed to paying the asking price knowing the issues that need to be addressed. . . . because I wouldn't count on the seller coming down . . .

 

[Flatswing]

Buy the recent survey from the buyer who backed out. Usual price is 50% or less. Insurance Co. doesn’t care who ordered or paid for the survey-but it needs to be comprehensive & recent plus you are going to have to fix most deficiencies.
Many on this forum wax poetic about suing the surveyor for missing stuff but If you read the preamble/legal text on most surveys, you will understand why this happens rarely in the real world. The issue with not hiring the surveyor personally is you miss out on being present during the actual survey. Do call both the previous buyer & the surveyor to get max information. Hire the surveyor for an hour or 2 if necessary to get updated or even an updated survey if necessary.
Finally, the info that seller wouldn’t budge, should be disregarded when/if you make an offer.

 

[koliver]

Some here have suggested you need that survey for insurance. An insurance survey is very different from a purchase survey. Insurance Cos are interested in all the safety and reliability related issues, so their surveyors home in on the things they need to cover efficiently and largely ignore the rest. Purchaser surveys are much more thorough, or should be, as you, the purchaser, need much more information about the value, potentially costly deteriorating systems, inventories of costly, but non-essential add-ons, etc.
If the purchaser's survey, at a discount, is acceptable to your insurer, consider getting it. Otherwise, if you see it, but can't buy it cheaply, look for a less expensive "insurance" survey next year, or the year after, when the insurer demands.

 

[Seevee]

Typically the deficiencies would be fixed by seller in event price wss to remain unchanged. You'll need your own C&V unless a cash deal ( your cash) and you go uninsured.

What's a C&V?

 

[Seevee]

Another comment....
Yes, there are insurance surveys and there are surveys that show condition and equipment.



The surveyor, with the x buyer's permission might put your name on the survey and make you a new copy. Cheapest was (most likely).


IF you get another complete survey, there is a likelyhood that he will find something else. That may or may not have value to you.


If you're worries about something, there's an argument to hire a specialist, like an electrical survey or an engine survey.


Now, what kind of boat are we talking about?

 

[denverd0n]

I would be asking the buyer that backed out, who recommended the surveyor to him? One hard and fast rule that I have always adhered to is, do not take surveyor recommendations from the selling broker.

 

[moparharn]

Many good points made here. I wonder a few things.

1. Have you read the survey in its entirety, or are you getting the "issues" from the broker.

2. Is the surveyor one who is well regarded in that area? Surveyors run from absolute fools to genius calibre. Find out what you can about him and read the entire survey to get a sense of how thorough the surveyor is before you consider spending good money after bad on buying the survey.

3. Are you committed to buying the boat with the listed deficiencies at the brokers price should you find nothing more of any real substance?

4. This is a very strong sellers market. Try to understand if the buyer is more likely the "issue", or is it the boat? If it looks like a duck, walks like a duck, etc etc. You are either going to get a decent boat in a tough market for buyers, or you are going walk the same heartbreak avenue as someone who knew what he was doing. Good luck.

 

[Comodave]

What's a C&V?

Condition and Value.

 

[jleonard]

Condition and Value.

Thanks. I also had never heard that term.

 

[slowgoesit]

Only one item I'll add to the above from my own personal experience. We purchased a boat recently and two insurance companies we spoke to required our name to be on the survey as the party that commissioned the survey. Best of luck in your boat search!

 

[PM]

My boat has had three surveys. I can't find the oldest but it is referred to in one of the others.

They are almost as revealing as a well kept diary of oil analysis. I like having them.

Might consider buying the previous survey (for penny's on the dollar and have a new one done.

pete

 

[Art]

Good suggestions on this thread... sometimes repeated in different words.

One important question was: What type of boat? I add - photos, please??

Here's a few others...

1. Do you understand build-out "methods" and materials used in construction of the boat? Basically, are you well versed in boats... owned before?

2. Do you understand the mechanics of engine, genset, transmission, shaft, prop - etc on that boat?

3. Electricity items, types and condition in your venue?

If you answered yes to all or any of the three questions; I recommend you take the hours necessary to survey the boat yourself. Have a boat-wise friend or really knowledgeable marina "old-salt" you pay a bit [$100?] to perform your survey with you. Take notes!!

Then I'd make sure to somehow get ownership of the previous buyers survey and make your boat-purchase decision thereafter.

Happy Boat-Search Daze! - Art

 

[FF]

A pre- purchase survey is a totally different animal from an insurance survey.

The surveyor will frequently nit pick the purchase survey to help lower the cost of his work , by giving a huge list you can negotiate the price with.

The insurance condition survey is vastly simpler , covers 1/10 the items and should be far cheaper.

 

[catalinajack]

New survey or not be prepared to accept the boat with all of the deficiencies of which you are aware.

A boat I was looking at, someone got to first. After a survey and sea trial there were a few deficiencies and the seller will not budge on the price, the buyer wants a reduction in price..... the same old story going on for several days now.
The broker shared with me the list of deficiencies, all of which seemed pretty minor. Broker asked me if it falls through would I want it.
Would it be necessary to re-survey if I had a copy of the one that was just done?

 

[JOHN CLAYMAN]

Full disclosure: I am yacht broker with decades of experience, educated at MIT in Naval Architecture & Marine Engineering, a yachtbuilder and licensed mariner for over 40 years. Because of my experience, I have little use for 90% of the practicing marine surveyors and always recommend an appropriate surveyor to my clients from a short list.

So,unless the previous survey was done by a member of the varsity under my supervision, I would always suggest engaging your own surveyor. I insist my clients are present at the survey and seatrials as they are an opportunity for a Buyer to learn a lot about the vessel...of more value that what will be in a written report.

I would not ordinarily worry that a Seller would not budge on the Selling Price. I always advise my clients (Buyers) when making an offer to not have an expectation of survey adjustments unless there are really big surprises like the bottom is badly blistered or the genset is junk. Your broker, should be knowledgeable enough to have a good handle on most minor issues that will be found at survey. There is no better way to upset a Seller than to make him/her feel like they are being nickel & dimed following survey. Further most brokers do not understand that if a Conditional Acceptance is made following survey, the vessel is no longer under agreement and the Seller is no longer obliged to sell you the vessel under the terms of the Purchase & Sales Agreement. We are definitely experiencing a Seller's Market at present so it's not adviseable to miss out on an otherwise good boat that is fairly priced and meets yoru needs.

 

[Art]

Full disclosure: I am yacht broker with decades of experience, educated at MIT in Naval Architecture & Marine Engineering, a yachtbuilder and licensed mariner for over 40 years. Because of my experience, I have little use for 90% of the practicing marine surveyors and always recommend an appropriate surveyor to my clients from a short list.

So,unless the previous survey was done by a member of the varsity under my supervision, I would always suggest engaging your own surveyor. I insist my clients are present at the survey and seatrials as they are an opportunity for a Buyer to learn a lot about the vessel...of more value that what will be in a written report.

I would not ordinarily worry that a Seller would not budge on the Selling Price. I always advise my clients (Buyers) when making an offer to not have an expectation of survey adjustments unless there are really big surprises like the bottom is badly blistered or the genset is junk. Your broker, should be knowledgeable enough to have a good handle on most minor issues that will be found at survey. There is no better way to upset a Seller than to make him/her feel like they are being nickel & dimed following survey. Further most brokers do not understand that if a Conditional Acceptance is made following survey, the vessel is no longer under agreement and the Seller is no longer obliged to sell you the vessel under the terms of the Purchase & Sales Agreement. We are definitely experiencing a Seller's Market at present so it's not adviseable to miss out on an otherwise good boat that is fairly priced and meets yoru needs.

Hi John

Thanks for experienced input. What kind of boat do you own?

Photos, please!

Art

 

[Conrad]

Full disclosure: I am yacht broker with decades of experience, educated at MIT in Naval Architecture & Marine Engineering, a yachtbuilder and licensed mariner for over 40 years. Because of my experience, I have little use for 90% of the practicing marine surveyors and always recommend an appropriate surveyor to my clients from a short list.

So,unless the previous survey was done by a member of the varsity under my supervision, I would always suggest engaging your own surveyor. I insist my clients are present at the survey and seatrials as they are an opportunity for a Buyer to learn a lot about the vessel...of more value that what will be in a written report.

I would not ordinarily worry that a Seller would not budge on the Selling Price. I always advise my clients (Buyers) when making an offer to not have an expectation of survey adjustments unless there are really big surprises like the bottom is badly blistered or the genset is junk. Your broker, should be knowledgeable enough to have a good handle on most minor issues that will be found at survey. There is no better way to upset a Seller than to make him/her feel like they are being nickel & dimed following survey. Further most brokers do not understand that if a Conditional Acceptance is made following survey, the vessel is no longer under agreement and the Seller is no longer obliged to sell you the vessel under the terms of the Purchase & Sales Agreement. We are definitely experiencing a Seller's Market at present so it's not adviseable to miss out on an otherwise good boat that is fairly priced and meets yoru needs.

Well said! In my experience, using a previous survey, even recent, is biased in some way and we have been burned badly.
So I would always commission my own survey, as you have the added benefit of the surveyor pointing out various details along the way. Some surveyors allow you to tag along and others prefer that you stand aside and they will update you at certain points throughout the survey. Either works for me.

I do have one question John; could you please elaborate on this statement?

Further most brokers do not understand that if a Conditional Acceptance is made following survey, the vessel is no longer under agreement and the Seller is no longer obliged to sell you the vessel under the terms of the Purchase & Sales Agreement.

 

[rgano]

Most likely you will need a survey of your own unless the other buyer will sell you his. Your insurance company will almost certainly want a recent survey and also if you get a loan the mortgage company will want one too.

Plus one here.

 

[Comodave]

Well said! In my experience, using a previous survey, even recent, is biased in some way and we have been burned badly.
So I would always commission my own survey, as you have the added benefit of the surveyor pointing out various details along the way. Some surveyors allow you to tag along and others prefer that you stand aside and they will update you at certain points throughout the survey. Either works for me.

I do have one question John; could you please elaborate on this statement?

Further most brokers do not understand that if a Conditional Acceptance is made following survey, the vessel is no longer under agreement and the Seller is no longer obliged to sell you the vessel under the terms of the Purchase & Sales Agreement.

I think it means that the buyer made a counter offer after the survey and therefore changed the conditions of the agreement. Then the seller can back out of the deal without consequences. In other words when the survey shows some deficiencies and the buyer asks for a drop in price the seller can walk away and sell to someone else. In the current market boats are flying out of the marina and the seller may get a better price for the boat.

 

[JOHN CLAYMAN]

Art:I owned a 57' sloop built in the UK in 1937 for thirty years that I kept in museum quality condition & ready to cross oceans until my wife passed away many years ago. Now that I have a lady friend, I am contemplating building one of our Seaton trawlers in steel / aluminum though I still enjoy sailing.

 

[JOHN CLAYMAN]

Conrad:There are well established protocols for the process of buying a vessel. We prefer using the Yacht Broker's Association of America (YBAA) Purchase & Sales Agreement. As you probably know your broker ... the Selling Broker not the listing broker should be holding your 10% deposit in their dedicated Escrow Account. That deposit is fully refundable unless your broker submits your signed Acceptance to the Listing Broker on or before the Acceptance Date following survey & sea trials. Once Accepted, your deposit is no longer refundable. If an Acceptance is not received by the Listing Broker before the Acceptance Date, then the Seller is no longer obligated to sell you the Vessel under the terms of the P & S even if a Conditional Acceptance is submitted. Typically, the Conditional Acceptance would be requesting the approval of the Seller to a modification of the terms of the P & S such as extending the Closing Date or more typically a reduction in the Selling Price due to a survey finding. Note, we never recommend asking the Seller to correct a deficiency. It's better to ask for a reasonable cost reduction. To support this request, we provide the Listing Broker with a copy of the relevant survey recommendation. Again, if a Conditional Acceptance rather than an outright Acceptance is submitted, the Vessel is longer under agreement and the Seller is free to say move onto another Buyer. This is a fine point that a lot of brokers do not understand. It bears repeating that Sellers do not react well if they feel they are being nickel & dimed.

When we do transactions in Europe the standard agreements have terms that favor the Seller so when representing a Buyer; even a European Buyer we insist on using the YBBA Purchase & Sales Agreement.

Lastly, be leery of any North American broker who uses any agreement other than the YBAA P & S which requires him/her to be a member of YBAA. Even better is to work with a YBAA Certified Professional Yacht Broker (CPYB). It's not a guarantee of getting a seasoned pro, but helps.

 

[Art]

Art:I owned a 57' sloop built in the UK in 1937 for thirty years that I kept in museum quality condition & ready to cross oceans until my wife passed away many years ago. Now that I have a lady friend, I am contemplating building one of our Seaton trawlers in steel / aluminum though I still enjoy sailing.

Best of Luck... Mr. Clayman!!

Sorry to hear about your wife. Pleased to learn of your lady friend.

 

[Seevee]

John,
Thanks for some interesting input, and I realize that's the way the business works, however, I have some heartburn over some of the stuff.


First, a deposit held by the buyer's broker is pretty worthless to a seller. And the seller is at risk, not the buyer. Clearly a deposit is meant to "guarantee performance" under certain conditions. (you called it the selling broker, but believe you meant that was the guy that found the buyer to sell to him). On default of the purchase agreement, the SELLER should get the deposit. However, should the seller not perform for the closing the buyer can get his deposit back and sue if he wanted to.

Also, the YBAA P&S agreement really favors the broker first, the buyer second and the seller last. As a seller, I wouldn't use it unless I'm desperate.
As a buyer I might, but as a broker it's a winner.

Also, why should the broker get anything unless he performs... and his duty is to get the boat sold. He has no risk.


However, best to you in you new boating venture!