Want to sell your boat but still owe money on it? You have options. Selling your vessel when it has been financed may seem daunting, but it doesn’t have to be. Not when you know how to sell a financed boat the right way. There are three steps to cover before handing your boat off to someone else. Follow through, and you will be able to walk away from the sale without any regret.
How Much Money Do You Owe?
The first step to selling a financed boat is to figure out how much you still owe. If you took out a loan with a bank, call and request a 10-day payoff quote. Once you know how much money is still owed on the boat, you can calculate how much you need to sell the boat for in order to not lose money.
How Are You Paying Off The Boat Loan?
Now that you have a clear picture of how much money remains to be paid, you can come up with a plan. There are three paths you can choose:
- You pay off the loan completely before selling
- You use the buyer’s money to pay the loan
- The buyer writes two checks—one to you and one to the lender
Paying Off Before Selling
If you want to make selling your boat easy, the best way to do that is to market it without any liens. In other words, the financial obligations have been paid, and the buyer does not have to worry about that debt. If the remaining balance is not too high and can be covered with a few payments, consider doing this first.
Within 7-10 days of paying off the boat completely, your lender will mail the original title to you, along with a notification that the boat is now 100% yours. From there, you can sell the boat directly to your buyer without any worries.
Paying With The Buyer’s Money
If you want to make selling your boat easy, the best way to do that is to market it without any liens. In other words, the financial obligations have been paid, and the buyer does not have to worry about that debt. If the remaining balance is not too high and can be covered with a few payments, consider doing this first.
Within 10-14 days of paying off the boat completely, your lender will mail the original title to you, along with a Satisfaction of Mortgage notification stating the boat is now 100% yours. From there, you can sell the boat directly to your buyer without any worries.
The Buyer Pays the Lien
In some cases, you may be able to have the buyer pay the lending institution directly. For example, if you are selling your boat for $200,000 and have $45,000 left to pay on the loan, the buyer will write two checks. One check will be for $45,000, and the other will be $155,000. The first check goes to the financial agency to pay off the loan, while you keep the remaining $155,000.
When possible, conduct this deal alongside the lender. This ensures that the funds have been verified. Once the lien has been paid in full, the lender will release the title to the new owner so that they can title the boat in their name.
Transfer Ownership to the Buyer
As with any deal involving money, there should be paperwork involved. Make sure you have all required documents signed and notarized at closing, such as the Bill of Sale. Work closely with a closing agent or broker, as they can provide you with all the necessary documentation and also work to contact your lender. Once the buyer and you have agreed to the terms and shook hands, follow through and deliver the title of ownership promptly.
Let Us Help You Sell Your Boat
Now that you know how to sell a financed boat, you can start searching for a buyer. Remember that you have options: pay the boat off immediately, or have the buyer write two checks. Whichever way, the loan must get paid off before your boat trades hands.
Need help selling your boat? Let Yacht Brokers of Annapolis help. We have years of experience working with boating enthusiasts like you. Whether you want to sell or trade in your boat, we can assist you with every step of the process. Why not give us a call today at 410-206-2755 to schedule a consultation?
