I have recently found a new set of questions related to the subject of using or not a broker in the process of buying or selling the boat, and they were answered by a nice guy, who allegedly helped the respective publisher to the acquisition of a brand new boat. Unfortunately he works for a brokerage corporation and some of his answers were obviously biased by his employer’s policies.
I want to re-enforce that I do not like brokers in general. I can act like one, because I actually was one of them, and I know how all of the parties think. The broker can be considered the equivalent of a lawyer. Sometimes you need one, most of the times not. I’m not talking about corporations here, and delegation of work, to lawyers, to brokers. Lawyers are bigger intermediaries than brokers. They can represent not only individuals, but whole institutions. Brokers are just an added expense. Imagine what the good broker answered to the first naive question: “Can you buy or sell a boat without a boat broker?” He gave “the short answer is yes”, but he advised both buyers and sellers to “carefully consider the risks”. What risks, I may ask? Can be the risks as in the following scenarios? The buyers risk if they don’t carefully examine the boat with a surveyor or at least with a friend who knows to do it. They risk to pay more than the boat’s value at the moment they buy it. The broker won’t discourage such a thing, because his commission or even a greater cut is determined by the boat’s price. What are the sellers’ risks? If they know their boats are damaged, without a broker, they will never sell. A broker can lie more credibly in order to help them.
The corporate broker recommends to take one of his kind in any sale valued from $10,000 up. Even for a bass boat, I may add. He says that brokered transactions are more secure, and then he continue to enumerate a few logical things to check out, for both parts, which according to him, only a broker can do: as a buyer, inspecting the boat with a qualified individual or even better, with a professional surveyor, arranging finance, insurance, registration, documentation, dockage, storage, training, etc.
My answer is that you can do all these operations on your own. If you change the flag, you may use another intermediary anyway, the one who handles Registers and Port Authorities, so why use two, or even three in case you have a lawyer too, besides the broker? Your boat’s price will be almost double the seller expects, only because of these middle men. The lower the price, the bigger their cut. I can give you a simple example. When I lived in Turkey, the guy I commissioned for changing the flag charged $6,000 per boat, to register them in Delaware. The tax was actually only $1,400 or so, and under $1,000 for an European flag, and he charged the same price. I understood that he had expenses, an office in a fancy complex near a marina, but even so, it was a little bit more than he could morally charge, don’t you think? And have you any idea what my partner said the charge was? $10,000!!! Without blinking.
A lawyer has a school, he can talk, he is proficient in studying the intricacies of the rules you have to comply when buying a boat abroad, or at your place. A Turkish broker has no special schooling, he has the school of life. Most of the time they barely write, and their English is as broken as their souls.
There is no advice provided by the asked broker, which is not based on common sense. He became hysterically funny when asked of the brokers’ nature, are there “bad” brokers too, or all of them are “good”. He wanted to believe that all of them were good, that basically a broker who follows his client’s “best interest”. I can answer that a “good” broker is always looking for his own interest, by continuously claiming that he follows his client’s. He also implies that the broker is a sort of godfather for the buyer, one never really cuts his cord with him, even if the deal is resolved.
The publisher asked in the end if there is a governing body for boat brokers, or an association that brokers belong to so that potential clients can look them up? The committed corporate broker answered that the kind of associations are numerous, and concluded that membership in these organizations demonstrates a broker’s commitment to his profession.
Yes indeed. If you can’t judge on your own, if you can’t make your mind, and you are willing to pay dearly for any step you make, mostly double value, but usually more than double, employ a broker.
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