A Boat Bill of Sale is a legal document that contains records of the sale transactions of a water vessel or watercraft.
This form acts as evidence of the buying and selling of either a motorized or non-motorized water vessel and ensures a smooth and successful transfer of a water vessel title after a sale occurs. It is essential for one to include a boat bill of sale in a selling or buying transaction of watercraft because:
In most states or jurisdictions, it is necessary to have a boat bill of sale to legally register a watercraft after purchasing it. Signing the boat bill of sale makes the purchase final even in cases that the agreed-upon funds are yet to be paid in full. Therefore, the seller should ensure the funds have been fully paid before this document is signed to authorize ownership to the buyer (new owner).
- It protects the buyer (new owner) from fraud accusations since it acts as proof of payment.
- It protects the seller (old owner) from any issues that could arise after the sale has occurred.
Types of Boats
Here is a list of the types of boats that can be purchased or sold using the boat bill of sale:
- Jet Ski
- Fishing Boat
- Cabin Cruiser
Pre-Agreement Information to Know
Following is a basic overview and information related to the boat bill of sale form:
Before the seller and buyer of a watercraft can complete a boat bill of sale, the following details are required:
- Seller– The seller is the party that is offering the water vessel for purchase. The seller’s details that are required include their full name and signature.
- Buyer– The buyer is the party that is purchasing the watercraft. The buyer’s details that are required include their full name and signature.
- Boat– Details about the condition of the boat are required to complete the bill of sale for the boat. Also, specific information like the odometer reading in terms of hours, title number, Hull ID number, year, model, and make are important to complete the form.
If there is a trailer or a motor to be bought or sold together with the water vessel, relevant details about it should also be included.
- Location– There is a need to provide the County and State’s name in which the purchase or sale of the watercraft will occur.
- Purchase price– Information about the amount of money or funds that are to be transferred from the buyer (new owner) to the seller (old owner) for the transfer of ownership of the boat to happen is required.
A boat bill of sale is used by either a seller or buyer of a bot in either of the following circumstances:
- If selling boats or related vessels
- If using a trade portal or websites) such as craigslist)
- If selling or purchasing boats and related vessels
- If buying or selling boats through a commercial outlet
- If you have purchased a watercraft from an individual and not a dealer
After all, parties sign the boat bill of sale, the buyer and seller must get a copy of the document. Additionally, a digital replica of the document should be availed to the parties.
Selling a Boat
As the seller, before getting to the stage of completing the boat bill of sale, there is a need to understand the proper steps of selling a boat. Here are the steps to observe when selling a boat:
Choose the Items to be sold
After deciding to sell the boat, it is important to determine what other items will be sold together with the boat. Such items might include life jackets, trailers, and outboard motors. Determining the items to be sold or not to be sold alongside the boat will help define the final value and later the price of the boat, especially if the buyer is interested in any of the items.
Estimate a worth
It might be difficult for a seller to determine how much their boat is worth and at what price they will sell it. As the boat owner (the seller), it is important to avoid having a higher or lower estimation of the boat’s value.
Also, looking up the details of the boat and the price they go for in the market might help determine its worth. Some of the details that can be used include the make, year, and model of the boat.
List the boat for sale
At this step, the seller can now put the boat up for sale. There are two ways that a buyer can use to list the boat for sale: a seller can either hire a broker or do it themselves.
- Hiring a broker- A broker is essential in listing if the boat’s value is at $40 000 and above. Using a broker will ensure that the boat is clean; hence, making it highly presentable to those interested in buying it. A broker will also be able to list the boat at a fair market value. As a seller, contact the local marina if interested in hiring a broker.
- Doing it by yourself- In the case that the value of the boat is less than $40,000, there is no need to hire a broker. In fact, most brokers do not list boats that are below $40,000.
NOTE: Clean the boat before listing it or using a broker to list it. Check for repairs and any clean-ups required to attract more potential buyers and stand a chance of selling the boat.
Present the boat to customers
The location of the boat might present a challenge when it is time to present it to potential customers or buyers. Try and dock the boat to make it easier for buyers to view the boat and get a feel of it when on water. Also, another viable option is packing the boat on land either in a trailer or on a stand can make it easy to present the boat to customers.
Avoid displaying the boat when it is on the mooring, as it will be a challenge every time a potential buyer wants to view the boat. In addition, people will have to be moved to and from the boat every time, making the process challenging.
Finalize the negotiations
At this stage, the buyer and seller will negotiate and come to an agreement about the prices of the boat and any other, if any, items that would be sold together. To finalize the negotiations, the boat bill of sale must be completed, as a requirement of most states, to legalize the sale of a watercraft.
Both the buyer and the seller must sign the boat bill of sale form to finalize the transaction. The boat bill of sale can also be used to record any other extra items that will be sold alongside the boat.
After the boat bill of sale has been signed by both parties, copies should be made for the seller and the buyer.
NOTE: The buyer must have a copy of the boat bill of sale to register the boat and obtain the title from the State.
Complete the Transaction
To complete the transaction, there are requirements that each party should do. For example, here is what is needed from the buyer (new owner) and the seller (old owner).
- Buyer- the buyer must provide the full payment as agreed during the previous step of negotiations.
- Seller- the seller must hand in all, if any, the latest registration documents and a signed title over to the buyer.
NOTE: The two should discuss and agree on whom should pay the sales tax. In most cases, both parties agree to pay a percentage of the sales tax.
Responsibilities of the seller
After the transaction is over, the seller should inform the specific state agency about the transaction. The details the sealer will share with the state agency are similar to what an ordinary vehicle sale demands.
This information is available from the boat bill of sale document, and any other details will come from the sales contract. If the seller has offered to provide warranty or extra materials like boat maintenance products, boat covers, or boat replacements, they must adhere to these promises.
NOTE: After becoming the boat’s new owner, the buyer should immediately register the boat with the State.
The buyer will require a signed boat bill of State, title forms, and other, if any, required registration documents. The buyer might also need to pay the sales tax at the step, depending on the State’s requirements, even though the seller accepted partial responsibility for it.
Filing the Boat Bill of Sale Form
Now that the need to have a boat bill of sale has been established, here is how to write and file a boat bill of sale form is done. The form has seven important sections that require correct filling.
Location of sale
This section requires the location, that is, the County and State where the bill of sale was completed. Also, information about the date when the bill of sale was created and completed is needed.
In a boat bill of sale, the parties are the seller and the buyer of the boat. The buyer of the water vessel must indicate their names and an up-to-date address. The seller of the watercraft, who will receive the funds and transfer ownership of the boat, should also indicate their name and address.
The clear identity of both parties is essential and highly required.
Under the exchange, this section provides the means by which a seller expects payment in exchange for the watercraft. This may include cash payment, trade-in, and as a gift.
- If the cash payment has been ticked, then the seller expects the indicated amount (in US dollars) before the seller can receive the watercraft. The buyer understands that this is a money transaction and must, therefore, pay the amount of money indicated before they can purchase the boat.
- If the trade-in payment has been ticked, that means that the seller or dealer of the boat is offering to offset the price of the watercraft being sold. Therefore, the buyer is liable to pay an amount of money alongside trading in an item that acts as a substitute for the other part of the payment. For this form of payment, there is essential information that must be filled in.
The trade-in information includes the following:
- Highlight the remaining amount to be paid in dollars alongside the boat to be traded-in as a substitute.
- Indicate the details of the boat that is to be traded in. The details may include make or manufacturer’s name, year, title number, hull ID number, and the odometer reader. These details can be confirmed through a visual inspection of the boat to be traded in.
If the boat is a gift, either to an organization or a private party or even to a business, then the gift check box should be ticked. The boat’s value should also be indicated as it is a requirement to fill out this option. The boat might be a gift as a form of charity. This option of “gift” is as necessary and must be indicated just like the other forms of payment.
The details of the boat and any other items to be sold together with it must have their full description in this section.
The details mentioned prior under the heading “Requirement for Boat Bill of Sale” must be indicated for the boat being sold. For the hull ID number, an inspection can be done to confirm it, and for the title number, details can be recorded from the boat’s title.
If there is a trailer being sold, a basic description of it should be included in the boat bill of sale. Details about the trailer include the year, make, VIN, and license plate. In addition, it is important to conduct a visual inspection.
During the inspection, one can confirm the details that have been provided about the trailer. To confirm the license plate of the boat, then check the rear end. Next, check the decal near the front part to confirm the VIN.
The horsepower, serial number, make, and year should be indicated for the motor being sold. The details of the motor are mostly found on a plate on the side of the motor.
Under the values section, the price breakdown and the total amount required before the exchange and transfer of ownership of the boat occurs should be written clearly and correctly.
For the price breakdown part, the price details of the boat, motor(s), and trailer (s) are broken down and recorded separately. If two motors are being sold, the total amount should be indicated on the motor’s part.
For the total part, the agreed amount of money that the seller should receive from the buyer is required and should be indicated. The total is the sum of the price breakdown of the boat and the other items. If the sales tax is needed at this step by the seller, then the total becomes the price of the breakdown in total together with the taxes.
The boat sales tax status must be well described in this section. Whether the sales tax was paid together with the agreed upon price should be indicated in this section. One should tick the appropriate box to confirm if the sales tax was paid or not.
Buyer and seller conditions
This section does not require filling. It provides information that describe that the individuals who choose to sign the document in the next section have accepted all the information present in all the other sections that appeared above.
For this section, the signing and authorizing of the boat for sell should be indicated. Components to be filled in this section include:
- Buyer’s Signature- the buyer’s signature is required to show the formal acceptance of the details in the boat bill of sale and the price to be paid for the boat. Also, signing the document is the first step of proving that an individual is the owner of the boat.
- Signature Date of Buyer- the date when the buyer signed the form should also be indicated.
- Buyer’s Name- the full names of the new owner should be written to identify the individual who has agreed to the terms of the contract and bought the boat.
- Seller’s Signature- the signature of the seller (old owner) is needed to show their willingness to transfer their ownership to the buyer (new owner) once the set conditions have been observed.
- Signature Date of Seller- the date when the buyer signed the form should also be indicated.
- Seller’s Name- the identity of the individual selling the boat should be highlighted by writing their full name.
- Notary Acknowledgement- the boat bill of sale must be notarized at the notary public. The party that should notarize the boat bill of sale will use this last part of the form.
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To purchase or sell a boat or any other type of water vessel, the boat bill of sale is essential and required. It is a legally binding document that acts as evidence of the purchase transactions and transfer of ownership from a seller (old owner) to a buyer (new owner).
There are specific types of watercraft that require this bill of sale for boat for a successful selling or buying to occur. Find out more details about these types of watercraft in this article. The requirements for a complete boat bill of sale include details of the boat, buyer, seller, location, and purchase price.
Get more details about how to fill the boat bill of sale and the steps that one must observe when selling or buying a boat or any other type of watercraft.