Buying a boat is a big deal for you as the prospective owner, but it also a big deal for the institution that is helping you finance the purchase. When you are buying a boat that is larger than twenty-six feet, a pleasure vessel this large is a significant purchase. It is only natural that lenders involved in a transaction like this want to have some level of protection for themselves so that they know their money is protected and will get paid back appropriately. In the world of boat ownership, the preferred ship mortgage offers a lender the security they need to agree to finance your purchase.
Understanding the Preferred Ship Mortgage
In the world of boat ownership, a mortgage of this nature gives precedence to this mortgage over any other liens that may be filed or exist against the boat. The law was put in place under the Ship’s Mortgage Act of 1920 and still exists today. Securing a loan to you under these circumstances is a standard business practice for lenders today to help protect their interests. Just as any lender would want to protect themselves if you were buying a home or piece of land, they will want to do the same with a boat purchase.
How the Filing of This Mortgage Works
There is a process that you will need to go through so you can file a preferred mortgage. Under these circumstances, the lender requires that the boat get federally documented so the first mortgage can be filed by the lender. Once you have made a commitment to purchase the boat, it is up to you to work with your lender to make sure the paperwork gets filed appropriately so you can secure the preferred status for your mortgage.
Getting Help Filing the Preferred Ship Mortgage
The process of filing for the preferred ship mortgage can seem confusing, which is why we at Vessel Documentation Online are here to help you. You can fill out the application for a preferred mortgage with us online, and we can check the forms and work with you and your lender to get you the documentation you need so the mortgage can be recorded properly. Let us help you make sure you get the documentation and services you need to secure your purchase and satisfy the needs of you and your lender.