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Would You Buy a Boat That Is Written Off ?

Would You Buy a Boat That Is Written Off ?

Would You Buy a Boat That Is Written Off

1-When Do We Say a Boat Is Written Off?
2- Why a Boat Gets Written Off?
3- What Happens After Being Written Off?
4-Is There Any Risk Buying a Repaired Boat?
5-How Can You Determine Issues?
6-Is a Surveyor Enough?
7- Google Is There for You
8-Now; Sellers Guide!

 

You Better Make Your Choice After Reading This Article

There are some situations where a boat is so damaged that almost nothing can be done to fix it back. However, that’s not always the case. Many people have the ability to repair damaged boats and ready them to sail/cruise again. You must be asking who are these guys… Well, they are professional shipwrights, engineers and mechanics that make money out of your wrecked boats/ships. What they do is to buy a badly damaged boat or ship for a cheap price and then turn it into a top-notch vessel — ok… maybe not a top-notch one; but it would be sailable.

But before these amazing guys to show up, buy your vessel and turn it into something new, there are some legal procedures that may be needed. Tje most important part when it comes to legal stuff and paperworks is your insurer’s policies. When an accident damages a boat/ship up to 80% of its normal value, the insurer writes off and then sells it to a salvage company.

Following, however, is a guide to prepare for buying/selling a boat that had written off, repaired and exhibited again — after an accident.

When Do We Say a Boat Is Written Off?

When Do We Say a Boat Is Written Off?

Usually it’s your insurer’s decision to be made. Since you will expect them to cover your loss after an accident that has caused damages to your boat/ship, you must wait for them to survey the boat and offer a solution. When damages are not major and can be repaired or replaced for a reasonable price, they usually offer to introduce a trustworthy shipwright who is is capable of fulfilling needs along with recouping the loss.

However, when the loss is equal to 80% of the boat’s value, the insurer would not be willing to to cover it. This case — according to insurance jargon — would be called a “Constructive Total Loss” (CTL). That is, your insurer wouldn’t bother to try fixing your boat in CTL cases and instead, would offer you a cheque — to say goodbye to your friend. And that’s when we the boat is written off…

Why a Boat Gets Written Off?

Why a Boat Gets Written Off

Since the repairing would cost something next to the price of a new boat of the same model, the insurer wouldn’t be willing to pay for it. That’s not rational to spend that much money on a wrecked boat to recover it from an accident, right? I believe no one wants to experience a situation in which the prices of repairings are higher than the actual value of a vessel. Well, insurer companies are no exception to that and don’t want to recoup such losses.

Thus, when there’s no hope to repair a boat for a rational price — which is less than 80% of its actual cash value — it gets written off (unfortunately).

What Happens After Being Written Off?

 

When a boat is written off, the insurer company tries to sell it for a fair price (though way cheaper than its actual cash value). They usually prefer working with salvage companies that are always  good customers when it comes to wrecked and useless stuff. A salvage company then, will try to use the boats components (i.e tearing it up into pieces) or sell it to someone who knows how to bring it back to the sea.

A shipwright/mechanic that is capable of repairing a wrecked boat/ship buys it from a salvage company and then prepares to sell again. Some of them, however, would not mention damages while selling the repaired boat — which means you have keep your open.

Is There Any Risk Buying a Repaired Boat?

Is There Any Risk Buying a Repaired Boat?

There are many risks when buying a repaired boat! When it comes to a boat that had written off, sold to a salvage company and then repaired to be sold again, you may face many issues and problems. So don’t fall for the cheap price tags on repaired boats. The most risky situations are those where a buyer is not aware of the fact that the boat has been repaired after a CTL consumption.

However, if you don’t have enough budget for buying a new or used boat and are dete to buy a repaired one, better be prepared for possible issues. You can’t expect a repaired boat that has been damaged up to 80% of its actual cash value to work properly — unless the shipwright/mechanic behind its resurrection is a GOAT in their job.

How Can You Determine Issues?

The only way of reducing the risks when buying a repaired boat/ship is determining the major issues before signing the contract. Of course, it would not be easy for a noHow Can You Determine Issues?rmal buyer, without previous boat surveying experience, to tell if a boat has been repaired well enough to be trustworthy or not. But you can examine the boat to find some obvious problems anyway. When you — as someone without proper explanation and knowledge — finds one or two problems when surveying a boat, it’s possible to conclude that there are much more hidden ones too.

For this reason, do not give up the surveying process because of your lack of knowledge and experience. There are some issues that need no professional surveyor to be found. Checking the interior design, for instance, is something that can be done by anyone who can see.

Is a Surveyor Enough?

Is a Surveyor Enough

Well, you may not be able to determine all main issues for a repaired boat. That’s why getting help from a professional boat surveyor may com in handy a lot. A surveyor is a person who has been working in the industry for fair enough long time and is capable of finding problems when it comes to repaired and/or used boats. If you are worried about buying a repaired boat and need a trustworthy person to guarantee the vessel’s proper condition, a surveyor would be a good choice. These guys have a lot of experience working with and surveying different boats/ships that are capable of confirming if a boat has good overall condition or not.

However, a surveyor is a human just like you; and capable of making mistakes. So, a full trust on a surveyor would lead you to more risky concepts. For this reason, you must make a blend of different approaches to determine if a boat worth it to buy or not.

If you have a professional sailor friend who can help you with surveying part, ask them to be on-site along with a professional surveyor that you’ve invited.

Google Is There for You

Google Is There for You

As mentioned above, a full trust on a surveyor’s experience with no further dispute wether the boat worth it to buy or not would cause more harm than good. That’s why you must act upon and try to gain more information about the repaired boat. To to so, ask the seller to give you the hull number, prior to any serious consultation. You can Google the hull number to find more information on the boat and it’s history. I’m sure that some the information ylu will get may shock you! The best possibility when Googling a hull number would be finding a photo/document that illustrates the previous condition of the boat — right after the accident/damage.

Thus, keep in mind that a hull number can mean much more than a identification code for you when it comes to repaired boats. It may change your mind — in a good or bad way.

Now; Sellers Guide!

Now; Sellers Guide!
Ok, now it’s time to lend potential sellers a helping hand with their selling processes. If you’re a broker or someone who makes money out out of selling repaired boats, following the instructions below would help you to gain better results — and profits.

document everything:

As soon as you buy a wrecked boat to repair and ready it to sell again, try to document everything. Take some clear photos that show the damages on interior and exterior of the boat. And ask the previous owner to give you copies of written accident reports.

When the process of repairing started, take more photos to use as a step-by-step explanation guide for your customers. (They will appreciate your honesty and become more likely to trust you).

Google can be on your side:

If you’re a broker who wants to buy a wrecked or repaired boat to sell it, you better Google its hull number too. Trust is an important factor in contracts, but you can’t trust a repaired boat without checking its history and previous condition. For this reason, try to ask for the hull number prior to any serious consultation and then Google it to see if it worth it to buy after being repaired or not.

try to be honest:

Hiding major issues before selling a repaired boat is illegal! A buyer can file a lawsuit against you after facing problems that have not been mentioned before signing the deal. So, try to be honest and let your buyers know what’s wrong with the boat.

Don’t worry about losing them, because the actual repaired boat buyers are aware of the chances of facing some normal problems.

Bonus: How to Survey a Used Boat?

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Now, since buying a repaired boat is similar to buying a used one, I decided to add a practical list of things to consider when buying a used boat. (Some of these suggestions can be applied when surveying a repaired boat too).

check for usual problems:

First things first: trust your inner feelings and ask about anything that seems wrong to you. Don’t be shy. Instead, try to be specific and serious about your questions and let the buyer/broker know that the answers are important to you.

check the appearance:

Survey every reachable parts of the boat. See if there’s anything seeming to be problematic or not. Color spots and missing parts of a interior and exterior appearance may be a sign for bigger hidden problems.

check the rig:

The rig is an important part of a boat; if you felt like something is no right about the rig of a used boat, ask your broker to explain about the cause or reason.

inspect the physical problems:

Try to find any obvious physical problem that is not mentioned by the seller/broker. This would allow you to see if they’ve been honest with you or not.

inspect water leaks:

Water leaks (especially below deck) can signal major issues. Thus, do not ignore them when surveying a boat.

have a trial sail (if possible):

Nothing would be better than a trial sail when surveying a boat. Ask your seller/broker to see if it’s possible to sail the boat prior to signing tje contract.

Note: if you don’t have enough experience sailing or cruising boats, have a professional sailor with you during the trial sail.

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