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  1. #1
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    Buying from a Private Seller (kind of long)

    A major part of our business is what we call a Private Purchase. This is where the seller is an individual owner, not a dealer. There are several things that need to be completed before the deal is "done". Since we do this every day, I would like to share a couple things to watch for. Many of these deals are done out of the buyer state and that also brings in a couple hoops.
    1. Have seller show you a copy of the registration - all states register. If not in the sellers name, move on.
    Many times people buy something with the intention of selling and don't register. The real problem is they are trying to avoid paying sales tax. If this is not right it's not his to sell. Your state will want the Bill of Sale to match the sellers docs.
    2. If the seller is in a title state, look at the titles. Again, they must be in the sellers name. Some states are "title holding states". This means the owner has the titles but a lien may still be recorded on the face. If the seller does not have the titles, chances
    are there is a lien and his lender has them.
    3. Never, never, never, never (is that enough?) pay money directly to a seller if there is a lien. Funds ALWAYS go to the lender first. The main thing is to get the liens released so yours can be clean.
    4. If the seller is in a non-title state (AL, GA, TN, NH, ND mostly) there can still be a lien. It would be called a UCC filed by the lender. There are ways to do UCC searches in the sellers name to be sure. IF there is a UCC filed, they must be released by the lender before your state work can be done. Even if you are both in non-title states, the second UCC has no weight until the first one is released. That would mean, you paid the money but don't own the boat.
    There are so many things that go along with this topic. We have learned a bunch over our history. Proving ownership for a seller is critical to you getting proper ownership. This is not an exhaustive list.

    Let me be very plain on this last point - no matter how great the "deal", if the seller does not present correct ownership papers and lien information - WALK AWAY. Chasing things after your money is gone is a lost cause. Sellers cooperate much better before they get paid.
    Let me know if we can help.
    Thank you,
    Ken
    (517) 543-6921 - Office

  2. Fishing is a Passion
    Join Date
    Oct 2011
    Location
    Wilmington, NC
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    3,177
    #2
    Great Info
    2002 Pro Craft 200 Super Pro- 2005 200 Mercury Optimax, Retired
    Empty Nester- Proud Grandfather 5-30-2014-Boy-Aiden, 8-2-2017-Boy-Calen

  3. Member Booster's Avatar
    Join Date
    Mar 2009
    Location
    Tucker, GA
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    2,299
    #3
    Hi Ken, thanks for that info.

    I am considering purchasing a 2018 used boat. 20k is his selling price. The seller is asking less than what he owes on the boat. I currently don't know his balance on his loan, but he did state he would have to make arrangements to transfer the boat clear. I am planning to met him tomorrow to do an on the water check out. We both live in GA, but he purchased the boat in TN and is financed in TN. If I decide to purchase the boat I was planning to pay full price cash, but now I am wondering what is the best way to handle the transaction so neither of us (especially me!) gets burned. Do you guys handle escrow type deals? Thanks, Tim, aka Booster

  4. BBC SPONSOR
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    Dec 2009
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    Michigan
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    #4
    Quote Originally Posted by Booster View Post
    Hi Ken, thanks for that info.

    I am considering purchasing a 2018 used boat. 20k is his selling price. The seller is asking less than what he owes on the boat. I currently don't know his balance on his loan, but he did state he would have to make arrangements to transfer the boat clear. I am planning to met him tomorrow to do an on the water check out. We both live in GA, but he purchased the boat in TN and is financed in TN. If I decide to purchase the boat I was planning to pay full price cash, but now I am wondering what is the best way to handle the transaction so neither of us (especially me!) gets burned. Do you guys handle escrow type deals? Thanks, Tim, aka Booster
    Thank you for the note. First off, no we do not handle escrow deals. That would mean we are taking the chance on liens, registrations, ownership and payoffs without the chance to be involved on the front end.
    Does not matter where he is financed, your money should go to his bank AFTER he shows a payoff letter from the lender with an accurate payoff amount. Paying cash and getting the boat will not mean you own it. In GA and TN, there would be a UCC filed for the lender as a way of lien. The lender is the only party that can release the UCC, an owner can't do that. They will only release the UCC after 100% of the payoff is collected by them.
    This answer can get long too. Call me and we can walk through a plan. Having a lien is not bad - paying cash and trusting is not a very good idea.
    Thank you,
    Ken
    (517) 543-6921 - Office

  5. Member
    Join Date
    Feb 2017
    Location
    Florida
    Posts
    5
    #5
    Good advice, thanks.