How Yacht Deals Close: The Final Steps

The yacht closing process is more complex than most transactions. Here's exactly what happens in the final steps.

Pre-closing checklist

Both parties confirm before closing day: - Survey deficiencies resolved (repairs, credits, or accepted) - Financing approved with funding date confirmed - Insurance binder effective at closing - Title and lien searches complete - Documentation prepared - Funds in escrow

The closing documents

Standard yacht closing involves:

**Bill of Sale** The transfer document. Notarised in most jurisdictions.

**Builder's Certificate or Manufacturer's Statement of Origin (MSO)** For new vessels. Establishes original ownership.

**Coast Guard Documentation transfer** For documented vessels in the US. Filed with USCG.

**State title transfer** For state-titled vessels.

**Lien releases** Any existing liens must be released and recorded.

**Loan documents** If financing, the buyer's loan agreement and security documents.

Title work

A marine attorney or title company researches: - Current legal ownership - Outstanding liens - Federal documentation status - State registration - Previous mortgages - Maritime claims

A clean title is essential before closing.

Escrow function

A neutral third party holds: - Buyer's funds (loan and down payment) - Original signed bill of sale - Coast Guard documentation - Title transfer documents

At closing, escrow distributes everything simultaneously — buyer gets title, seller gets money, all documents are recorded.

Closing day timeline

**Morning** - Final walkthrough of vessel - Confirm all included equipment is aboard - Take possession photos - Test all systems one final time

**Midday** - Sign closing documents - Wire transfer of funds - Notarisation of bill of sale

**Afternoon** - Funds clear - Documents transfer - Keys exchange - Insurance becomes effective - Documentation filed with authorities

Federal documentation (US)

US Coast Guard documented vessels require: - Transfer of Documentation form - Filing fee - 30-60 day processing time - Temporary certificate issued at closing - Permanent certificate mailed later

State registration (US)

State-titled vessels require: - Title transfer at DMV/state marine office - Registration fees - Sales tax (varies by state) - New registration issued

International transfers

Cross-border transactions require: - Export documentation from selling country - Import documentation in receiving country - Customs duties (varies) - VAT considerations (significant in EU) - Flag state registration changes

After closing

• Update insurance to permanent policy
• File transfer documents with relevant authorities
• Update marina paperwork
• Register with VHF and EPIRB authorities
• Schedule first owner service

Common closing problems

**Liens discovered late** Maritime liens can lurk in records. Marine attorneys catch these.

**Documentation discrepancies** Vessel name, HIN, dimensions on documents must match reality.

**Tax complications** Different states have different sales tax rules. International deals have VAT implications.

**Funding delays** Bank transfers can take 1-2 days. Plan for delays.

Why brokers and attorneys matter

For yacht purchases over $250K, the cost of professional help is small compared to the cost of mistakes. Marine attorneys typically charge $1,500-$5,000 for closing services. Worth every penny on complex deals.