By Randy Scott
How to Buy a Boat
Tactics for ensuring a successful purchase
You’ve spotted the boat of your dreams at a boatshow (or was it in your neighbor’s driveway?) and you’re ready to buy. Before you plunk down a sizeable amount of change, there are a number of factors you should consider.
First, you’ll need to determine the type of boating you will be doing. This may seem an obvious starting point, but you’d be surprised how many buyers purchase a boat that doesn’t fit their needs.
The type of water you will be boating on and the climate are other important considerations. Small, sheltered bodies of water don’t require a boat with as much freeboard and deadrise as those used on larger bodies of water where you will encounter bigger waves and rougher conditions. In a colder climate, the boating season is relatively short. To prolong it you may want a boat that offers more protection from the elements. In warmer climates an open boat with a Bimini top for shade may be the better choice.
[Editor's note: If you need to sell your existing boat first, check out the Boats.com Boat-Selling Resource Guide for Private Sellers.]
New Or Used
Once you have determined the type of boat that suits your needs, the next decision is whether to buy it new or used. A used boat will cost less than a new one and often comes better equipped, but there may be added expense in repairs and upgrades. A used boat also has a proven performance and reliability track record that can be researched. On the other hand, a new boat comes with a full warranty. However, new boats depreciate the moment they leave the showroom floor. Buying new may be viewed as less of a risk to financial institutions, so terms, interest rate and down payment requirements may be better.
If you decide to go with a new boat, boat shows are a prime shopping ground. Side-by-side comparisons permit you to evaluate several competing models at one location. You can also look for “Boat Show Specials” and negotiate deals between competing manufacturers. However, consideration should be given to the dealer you buy from. If he is located hundreds of miles away from where you live or if does not have a service shop, these “specials” may not be such a bargain.
One good tip when shopping for new boats is to do it at the end of the model year. Typically toward the end of July dealers are trying to clear out old inventory. Another good tip is to search out the previous model year’s leftovers once the new models have arrived.
If you opt to purchase a used boat, your shopping can be done by browsing classified ads found in newspapers, magazines and on numerous websites, including boats.com. Many dealerships also offer used boats that have been taken as trade-ins. A dealership may offer a limited warranty on the used boat and has likely serviced it to some extent in readying it for resale. But because the dealer is a third party and has overhead, including sales commissions, the price is generally higher than what you would pay the owner directly.
Once you have found a used boat that interests you, it is wise to call the U.S. Coast Guard at (800) 368-5647 and ask for information about manufacturers’ recalls for that particular model. If a recall has been issued, ask the owner if the repair has been performed. If not, find out if the period of recall is still in effect.
One important tip is to check the seller’s proof of ownership. If the price is a “steal,” the boat may very well be stolen. So check the necessary documents, and if they can’t be produced, beware.
Once you pass that hurdle, it’s time to inspect the boat. A primary concern on a used power boat is its engine. A boat engine has to work much harder than its automotive counterpart, so pay special attention to its condition. If you are not mechanically astute, it is best to have a mechanical technician check the engine before you commit to a sale. This is especially critical if the boat has been used in salt water, which is much more corrosive than fresh water. But even a cursory check of the following items will provide some clue as to the engine’s health.
Engine Check List
- Is there oil in the bilge? It may be a sign of an oil leak and warrants closer inspection.
- Are there signs of lubricant leakage around gaskets, freeze plugs and hoses?
- Are the hoses, belts and fittings cracked or brittle?
- Pull a spark plug and see if it appears relatively new, or burnt and poorly gapped. (This will provide an indication of how well serviced the engine is.)
- Is there a white chalky residue on the engine or drive? (This may indicate that it has been running hot.)
- Check the engine’s oil condition and level. (If the oil looks milky, water may have entered, indicating the possibility of serious mechanical problems.)
- Check gearcase oil.
- Are the sacrificial anodes on the drive in good shape, or should they have been replaced long ago?
- Are there signs that the drive, rudder or propeller have hit submerged items.
- Look for signs of cavitation damage on the propeller(s), which is indicative of poor performance.
- Check for broken engine mounts.
- Compression check the engine.
If you do not feel qualified to perform any of these tests, then the best course of action is to get it done by a qualified technician.
Boat Check List
Aside from the engine, your inspection should also include the following:
- Check steering and throttle controls and cables.
- Switch on and operate all systems; bilge pump, blower, lights, stereo, winches, freshwater sink and shower, galley stove, head, heater, air conditioner, generator and so forth.
- Make sure all hardware is still firmly attached and check the condition of backing plates where possible.
- On a sailboat, check all rigging, hardware and sails.
- Open and close hatches.
- Check out the fuel tanks, fittings and lines. Be sure to smell for leaks.
- Are the batteries securely fastened in acid-proof containers?
- Perform an out-of-water inspection to see if there are dings or cracks. Also check for stress cracks, chips in the gelcoat, hull blisters and other hull irregularities.
- Is the propeller shaft and rudder stock straight?
- Is the upholstery in good condition and the stitching still holding?
- Does the cabin smell like mildew?
- Check through-hull fittings to ensure they are not loose and leaking.
- Check electrical items and connections for rust.
Using a Marine Surveyor
If all this checking and investigating seems a bit overwhelming or too time consuming, you may want to hire an independent marine surveyor to do it for you. In fact, your loan and insurance agents will probably insist on it. And you’ll probably sleep better at night!
A licensed surveyor is an expert in the field of boat construction, who is also well versed in safety and manufacturing laws, requirements, recommendations and approved practices. Some banking institutions require that the boat be surveyed before a loan is given, especially on large vessels that represent a sizable investment. (Usually a marine surveyor offers his services for boats 25-feet long and larger, but there are exceptions.) It is wise to hire a surveyor certified by such organizations as the National Association of Marine Surveyors, or the Society of Accredited Marine Surveyors, (800) 822-6267.
When the survey is conducted, it is a good idea for you to be there while it is happening. This allows you to observe firsthand the surveyor’s assessment of the boat’s condition, and permits you to ask questions that could require answers later. Never rely on an old survey, as new problems may have cropped up since it was conducted.
Another available source of help in purchasing a boat is to hire a licensed yacht broker. (Generally brokers only assist in buying and selling boats 27 feet and larger.) A good broker will walk you through the entire boat buying process, from determining what type of boat you should get, to arranging financing and negotiating a contract. About the only thing a broker will not do is survey the boat.
Brokers have an extensive network of contacts and boat listings from which to search and can greatly increase your likelihood of finding the right boat. Once you have located a boat you wish to purchase, a broker will write up an official Offer to Purchase for you to sign, and ask for a down payment of approximately 10 percent of the purchase price. Make sure the Offer to Purchase stipulates that the final purchase is contingent on your satisfaction of a sea trial and survey. The down payment goes into a bank trust fund that the broker administers. If you have not pre-qualified, the broker can help you obtain a loan and the necessary insurance.
It is not likely you would purchase a used car — or for that matter a new one — without test driving it first. The same mentality should be applied to buying a boat. Also, if you hired one, it is a good idea to bring your broker along on the sea trial or demo ride
During your time on the water you should put the boat through a series of tests. On a power boat, first check to see if the engine(s) are already warm before turning the ignition. If the owner “warmed the boat up” prior to your arrival, it may have been done to hide the fact that the engine has problems with cold starts or it smokes a great deal before it warms up. Check the bilge at the beginning and end of the sea trial to see if any oil has leaked. In the case of a sailboat, raise all sails and check the mast while under load.
Maneuver the boat around the dock in forward and reverse to see how well and how quickly it responds to helm input. Then slowly work your way out to open water and check for excessive bow steering while at slow speeds.
Take note of how long it takes the boat to come on plane. Five seconds is average, while 10 seconds is excessive for most boats. Put the boat through a series of slaloms, wide turns and tight turns, and do these at various speeds. In straight runs, is there a tendency for the boat to porpoise or bounce up and down at the bow? Will adjusting the trim get rid of the problem? Take waves at all angles and if there are no waves, create some by going in circles. If there is a flying bridge, go up to see if your weight causes side-to-side roll. Also check the ride below deck if the boat has a cabin.
Through it all, observe whether the instruments and gauges work properly. Run the boat long enough to know whether the engine will overheat, and be sure to check the oil pressure gauge.
Concluding the Sale
If you are satisfied with the condition of the boat and its performance, the last consideration is price. No doubt you gave some thought to this from the outset, but now it’s time to pay serious attention. There are several marine price guides that you can consult to get some idea of a boat’s market value, but note that these are ballpark figures and much depends on the results of your survey and sea trials to determine ultimate value. The following pricing guides or “blue books” are good sources: ABOS Marine Blue Book, (800) 262-1954; BUC Used Boat Price Guide, (800) 327-6929; NADA Marine Appraisal Guide.
After you have finished negotiating the price, put it in writing. An exchange of cash and a handshake are not wise, even if the person you are buying from is a friend. Your written Sales Agreement should be specific on matters such as terms of payment, repairs that need to be made and who is responsible for making them (including a deadline if the responsibility falls on the seller), accessories included and not included in the purchase, delivery dates, and any other pertinent items of the agreement.
At this point the only thing left to do is go boating!