The deposit
When the contract is signed, the buyer pays a deposit. Ten per cent of the price is common, although recent editions of the MYBA form leave the figure to be agreed. The deposit shows the seller that the buyer is committed, and it gives the seller a remedy if the buyer later fails to complete without a contractual reason. It is paid within a few banking days of signing, and the sea trial and survey normally do not begin until it has arrived.
The deposit is refundable in the circumstances the contract sets out, most importantly if the yacht is rejected after survey in accordance with the notice procedure. The RYA's advice to buyers of smaller boats is the same as ours for every purchase: know exactly when your deposit comes back before you pay it.
If the buyer fails to complete after acceptance without a contractual reason, the contract usually lets the seller keep the deposit and may allow a further claim. That is why a buyer should sign only when the funding for the balance is arranged.
The stakeholder
The deposit is not paid to the seller. It is paid to a stakeholder, a neutral party named in the contract, who holds it in a client or escrow account and releases it only in accordance with the contract's terms. The stakeholder may be a law firm, a specialist escrow provider, or a firm in the yacht trade that operates a client account. What matters is that the account is segregated, that the stakeholder's obligations are clear, and that the release conditions in the contract are ones you have agreed.
We tell you who the proposed stakeholder is at the outset, and we confirm the account details with you by a second channel before any money moves. Payment redirection fraud, in which criminals intercept emails and supply false bank details, is a real risk in any high-value transaction. Never act on changed bank details received by email alone.
Before closing: the checks
Between acceptance and closing, the work is about title and encumbrances. The seller's ownership is checked against the registry and against the chain of bills of sale. An extract from the registry shows whether any mortgage is registered, and the contract requires it to be discharged at or before closing. Where the seller is a company, its good standing and the authority of its signatory are confirmed.
The yacht's VAT evidence, her class and flag certificates, and the inventory are gathered at the same time. For the balance, the buyer's funds are usually sent to the stakeholder ahead of the closing date, so that they are in place and cleared when the documents are ready.
Any registered mortgage over the yacht is normally paid off from the sale proceeds at closing, with the lender's release delivered in exchange. The contract should say how that works, so that the stakeholder can pay the lender first and the seller the remainder, and the registry can record the discharge.
The closing itself
Closing is the moment title and possession pass together. The seller delivers a signed Bill of Sale, the registry documents and any deletion certificate, and both parties sign a Protocol of Delivery and Acceptance recording the date, time and place of handover. The stakeholder then releases the deposit and the balance to the seller, less any agreed deductions. Keys, manuals, certificates and the yacht's records are handed over aboard.
Closings are often arranged with the parties in different places, with signed documents held in escrow by the lawyers until everything is in order and then released at an agreed time. Where the place of delivery matters for tax reasons, it is fixed in the contract, and the yacht must physically be where the documents say she is.
After closing
Once title has passed, the yacht is registered in the buyer's name, or in the name of the owning company, and insurance must be in place from the moment of handover. The crew's employment is either continued under new agreements or ended by the seller, according to what the contract says. We stay with you through registration and insurance, and our guide to delivery and crew covers the first weeks of ownership.
Keep the closing file safe. The Bill of Sale, the Protocol of Delivery and Acceptance and the VAT evidence are the documents the next buyer of your yacht will ask to see.
Questions buyers ask
Why not pay the seller directly?
Because the stakeholder protects both sides. The seller knows the money exists and is committed; you know it will be released only when the contract's conditions have been met and the documents delivered.
Who chooses the stakeholder?
The stakeholder is agreed between the parties and named in the contract. We tell you who is proposed at the outset, and you or your lawyer can ask about the account and its terms before signing.
How do I protect myself against payment fraud?
Confirm bank details by telephone with a known contact before paying, and treat any email announcing changed details as suspect. We verify the stakeholder's account details with you before any transfer is made.
When does my insurance need to start?
From the moment of handover. Arrange cover before closing so that it takes effect at the time recorded in the Protocol of Delivery and Acceptance.
This guide is general guidance as at September 2026, not legal or tax advice. Your own adviser confirms the position for your purchase.
