Avoid Costly Mistakes: Why Title Verification Is Important When Buying a Used Boat

Buying a Used Boat? Here's Why Title Verification is Important

If you live in South Texas or South Florida, or of course, Southern California, you may not be thinking much about getting on the water right now, unless. But for the rest of us in the hinterland, the time has come to put our boats away for the season and watch the snow fall down. With that said, it can also be a really great time to go ahead and to get a deal on a boat. But what if it doesn’t have a title? Or what if you live in a state that has high sales taxes? 

We know a thing or two about this sort of thing. One of the things that comes up often is the issue of title verification. What exactly is title verification and why does it matter? Let’s find out. 

What Is a Boat Title and Why Does It Matter?

First off, why are you even worried about this? Titles are for cars and motorcycles, right? 

Yes. But also boats. Titles are legal documents issued by all states to establish and confirm the legal ownership of a motor vehicle or trailer. Boats are most definitely in this camp of motor vehicles and trailers, boat trailers are a separate vehicle from the boat, thus requiring a separate Certificate of Title. 

In layman’s terms, a boat title proves that you are the legal owner of the vessel. Why is this so important? A few reasons.

When you are the lawful owner, you will need to register your vessel to legally operate it on public waterways, and you cannot do this without having a title. In the event that there were disputes over who the lawful owner of the boat is, the title holder will always be the owner. If you have the title in hand ,or held electronically, in your name, the vehicle is yours. 

Proof of ownership is pretty important when we are talking about boats valued in the thousands to tens of thousands of dollars. 

What Is a Hull Identification Number (HIN)?

Boats and vessels have standardized identification numbers and processes to include the Hull- Identification Number, which is the same concept as a car’s Vehicle Identification Number (VIN). The HIN consists of a 12-character combination of letters and numbers that identifies a boat's make, model, and date of manufacture. 

The HIN is a federal requirement for the same reason why VIN’s became standardized: tracking and verifying ownership mostly for when boats go stolen. No, it’s not pleasant to talk about or think about, but yes, it does absolutely happen. Boats get stolen, and there must be a method to verify ownership when it is recovered or to aid in recovery. 

The Importance of HIN Inspection

When a boat is being purchased across state lines, a HIN inspection is required to transfer the title. Generally, like a VIN inspection, this is not required when it is purchased and transferred in-state. 

In short, when a HIN inspection is required, you will not be able to transfer registration or ownership until you get the inspection done. This is usually accomplished by some designated law enforcement agencies like Fish and Game Wardens or County Sheriffs. 

The HIN inspection is simply CYA for the state: they want to make dang sure that there are no title issues that will come back against them from another state when boats are crossing state lines. 

What Happens If You Skip Title Verification?

There is no skipping title verification. If you decide to go out of state through a Montana LLC boat registration, you can’t get out of title verification. Don’t worry; it really is painless. And it is good for you; protecting buyers from purchasing boats with undisclosed liens, ownership disputes, or fraudulent titles.

So, if you don’t want to get your title verified, you just bought yourself a rather large paper weight. 

How Dirt Legal Can Help with Boat Titles

There are a couple of ways we can help. First, standard registration service through Montana is valid in all 50 states, just like a car. We can do the whole process for you so you don’t have to leave the comfort of your own home. The HIN inspection will have to be done during the process, but we won’t send that until you are ready for it. This process is straight-forward and as long as you have valid proof of ownership, you are good to go. 
The second way that we can help is with a bonded title. This is used when to provide surety through a surety bond when there is no clear ownership on a title; i.e, a missing title. The surety bond is your way of putting your money where your mouth is and putting a bond (not unlike a bail bond) down on the title. As long as there are no challenges against the ownership of the bonded title, the bonding brand will come off the title after a few years, usually 3-5. Once the bonded brand is off, it is a clean title. 

Final Thoughts on Buying a Used Boat

Buying a used boat is a big decision, and that one you just found for 50% under retail? Yeah, you might want to look into why it is so cheap. If it isn’t a mechanical issue, check around and find the condition of the title. Boats are just like other vehicles: if the title is problematic or missing, the value of the vehicle drops dramatically. How much is not a precise calculation, but anywhere from 25%-50% less than the resale value can be expected. 

Thankfully, we can help out with our bonded title service. And if you have a clean title already in hand but would rather not shell out 7% or more in sales taxes (based on the national average), check out our boat and vessel titling service. Montana boat registration is included in this package, so all you have to do is click buy, sit back, and wait for your paperwork to show up. That’s it!