Why Not Use Escrow Accounts When Buying a New Custom Boat?
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Why Not Use Escrow Accounts When Buying a New Custom Boat?
I've seen a bunch of horror stories about people prepaying for a new custom boat, and then the builder goes belly up, and the buyer loses all his money. Sometimes, the buyer may get the boat, but it is months or even years late. Sometimes the boat is incomplete when delivered.
Why don't people use escrow accounts? The buyer puts the money into an escrow account. The builder knows he will get the money when delivered, and the buyer knows he is going to get a boat for his money. If the company is not solvent enough to build a boat with its own funds, or can't manage a build schedule, or doesn't deliver the boat per specs, then the buyer gets his money back after a predetermined period of time. You wouldn't buy a house without an escrow account. Some of these boats are expensive as houses.
It seems like it would solve a lot of problems.
Michael
Why don't people use escrow accounts? The buyer puts the money into an escrow account. The builder knows he will get the money when delivered, and the buyer knows he is going to get a boat for his money. If the company is not solvent enough to build a boat with its own funds, or can't manage a build schedule, or doesn't deliver the boat per specs, then the buyer gets his money back after a predetermined period of time. You wouldn't buy a house without an escrow account. Some of these boats are expensive as houses.
It seems like it would solve a lot of problems.
Michael
#2
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I've seen a bunch of horror stories about people prepaying for a new custom boat, and then the builder goes belly up, and the buyer loses all his money. Sometimes, the buyer may get the boat, but it is months or even years late. Sometimes the boat is incomplete when delivered.
Why don't people use escrow accounts? The buyer puts the money into an escrow account. The builder knows he will get the money when delivered, and the buyer knows he is going to get a boat for his money. If the company is not solvent enough to build a boat with its own funds, or can't manage a build schedule, or doesn't deliver the boat per specs, then the buyer gets his money back after a predetermined period of time. You wouldn't buy a house without an escrow account. Some of these boats are expensive as houses.
It seems like it would solve a lot of problems.
Michael
Why don't people use escrow accounts? The buyer puts the money into an escrow account. The builder knows he will get the money when delivered, and the buyer knows he is going to get a boat for his money. If the company is not solvent enough to build a boat with its own funds, or can't manage a build schedule, or doesn't deliver the boat per specs, then the buyer gets his money back after a predetermined period of time. You wouldn't buy a house without an escrow account. Some of these boats are expensive as houses.
It seems like it would solve a lot of problems.
Michael
Maybe bigger builders like Cigarette or Outerlimits can afford to build a custom boat on it's own funds but I don't think most smaller builders can. Plus, even if you could, it wouldn't make financial sense to do so. Why would you want to tie up your cash flow.
If I didn't feel comfortable paying for materials and progress payments (based on visual inspection of work) I wouldn't use that builder.
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I've seen a bunch of horror stories about people prepaying for a new custom boat, and then the builder goes belly up, and the buyer loses all his money. Sometimes, the buyer may get the boat, but it is months or even years late. Sometimes the boat is incomplete when delivered.
Why don't people use escrow accounts? The buyer puts the money into an escrow account. The builder knows he will get the money when delivered, and the buyer knows he is going to get a boat for his money. If the company is not solvent enough to build a boat with its own funds, or can't manage a build schedule, or doesn't deliver the boat per specs, then the buyer gets his money back after a predetermined period of time. You wouldn't buy a house without an escrow account. Some of these boats are expensive as houses.
It seems like it would solve a lot of problems.
Michael
Why don't people use escrow accounts? The buyer puts the money into an escrow account. The builder knows he will get the money when delivered, and the buyer knows he is going to get a boat for his money. If the company is not solvent enough to build a boat with its own funds, or can't manage a build schedule, or doesn't deliver the boat per specs, then the buyer gets his money back after a predetermined period of time. You wouldn't buy a house without an escrow account. Some of these boats are expensive as houses.
It seems like it would solve a lot of problems.
Michael
sonny miller my opinion .