How To Understand the Importance of Proper Vessel Title Documentation

Your Boat Might Need A Title. We Can Help.

Dirt Legal has been the go-to source for out-of-state title recovery and registration for years now and we’ve helped over twenty thousand satisfied customers get their paperwork squared away on their rides. Well, our services extend beyond the open road. In fact, our services extend to the open water. 

See, a lot of boats have titling requirements similar to those of cars, trucks, trailers, UTVs, you name it. And sometimes, when you go to buy a boat, that title is missing. Now, this can be a great way to get a bargain because vehicles missing their titles have substantially lower value than those with titles. But how do you go about getting that magical slip of paper? And why is it so important for something that doesn’t drive on the road? 

You’re about to find out. 

What is Vessel Title Documentation?

We’re going to take it back to the basics here. A title is a title, regardless of what it is on. In fact, personal anecdote time: I went looking at a project rental property about a week ago and it was actually an old (late 1960s) double-wide trailer put on a block foundation.

Why does this matter?

Because, to the State of Kansas, it is still a trailer. As in, a road trailer. The house is a trailer according to the state, so there has to be a title to complete the deed for the property as having a house. Since there was no title, the property technically has no “house.” It is a vacant lot with a bonus, untitled trailer that serves as a house. See the distinction?

So, the property was priced accordingly. It is listed for the price of a lot, not a house. All of that because of a slip of paper. 

The same exact thing happens with a boat (or anything else) that needs a title and doesn’t have one. The title is legal proof of ownership. Nothing more, nothing less. Not all boats require a title, but basically all motorboats do which is a huge chunk of the boats on the water. And just like a car, you can’t register it without a title. 

Risks of Improper or Missing Title Documentation

Basically, there is only one real risk to improper or missing title documentation: you can’t prove that you own the boat. That was the problem with the aforementioned project property: you can’t say that the house comes with it when there is no title for it, since it is really a trailer. 
That same exact logic applies to everything else that has a title. 

If you already own the boat, it will prohibit you from obtaining registration. If you want to buy a boat without a title, you can land a bargain…but you better make sure you can get a title for it first. That’s where Dirt Legal comes in with a process called a “bonded title.”

How to Obtain Proper Vessel Title Documentation

That last line with the perfect segue into how you can and will get a proper vessel title. 

Here’s the thing: this process is called title recovery for a reason. It’s because the title is missing. You know the title is missing, and you can’t get a replacement for whatever reasons. 

See, here’s the thing: since the title is more or less up in the air at this point, the person who held the title last can contest that the title is really theirs. It kind of sucks, but it is true. So, there is a process that uses a title bond. A title bond is not really any different in idea than a bail bond. It is putting skin in the game that you are the rightful owner. 

Just like a bail bond, you don’t put up the whole amount for the bond; you find a title bond agent. The alternate name for this is a surety bond, which makes sense: the state is actually liable here since they are issuing the title. If they erroneously issue a title to a fraudulent buyer, the state is getting taken to court and they don’t want that. But since there is someone claiming to be the rightful owner but they can’t provide proof of holding the title, the bond is that appropriate skin in the game. 

Maintaining Your Vessel's Documentation

So, here’s the deal: when a bonded title is approved by the DMV, in our case through the Montana DMV, it will not be issued a clean title immediately. It will instead be branded with a surety or bonded title brand. Unlike a salvage title or other title brand that has to do with the physical condition of the vehicle, this brand merely indicates that the vehicle has a surety bond against the title. 

For three years, the title can be contested. This is rare, but it could potentially happen. It would probably take very convincing and overwhelming evidence to turn against you since you did the legwork to get a bonded title and the DMV approved it, but it can happen so be forewarned.

Once the three-year period has passed, you can apply to have the bonded title brand removed from the title and you will then be issued a clean title. Since you have the title now, if you were to ever lose it, all you would have to do is request a replacement from the State of Montana. No biggie. Getting that first one issued for a boat that you never held the title to is quite a bit harder, but we’ve got you covered.  

When to Seek Professional Help

The best time to seek the services of Dirt Legal depends on the situation. 

If you are getting the boat from a family member and it is being gifted to you, request it immediately if they aren’t able to request or procure a clean title. This is especially important if the family member passed away. Obviously, the title shouldn’t ever need to be contested since they are deceased, but you still have to go through the process of getting a surety bond (that’s okay; it’s part of our process). 

Since your Montana title will come bonded, there's one more step before you can get started. It's a HIN/VIN Inspection, which is basically a background check for your HIN (Hull Identification Number) to make sure there are no flags associated with it. All you have to do is download the document attached here, call your local police department, and they'll send someone out to complete it for you.

Once you have the completed document, you can go ahead and start your order.

Final Thoughts

There are lots of different reasons why a title goes missing. Usually, it was because it was sitting on a dusty bookshelf or filing cabinet for years and got forgotten about. It usually isn’t anything nefarious. Of course, the DMV has to cover all the bases just in case it was stolen, so the HIN is conducted to rule this out. Once that comes back clean, the surety bond is really there to protect you and your good name, and the asset you just acquired. 

We make the process super easy for you, and not only will you get a title in your name, but your boat will also be registered in Montana through your LLC. You’ll get all the paperwork and registration stickers you need in the mail; we handle the rest.