Marina and Storage Liens: How Lien Sales Work, Buying a Lien-Sale Boat, and Not Losing Yours

Find the sections on fees, late charges, what happens if you fall behind, the lien and "arrest" language, and who pays legal costs. BoatUS also points out that contracts can require insurance, registration, an operable boat and more, and that some can be terminated for cause, including unpaid fees. Ask questions or negotiate before you sign.

Lien notices go to the address on record. In Florida, a notice sent by certified mail to your last known address is presumed delivered when mailed, whether you see it or not. California's DMV mails notices to the registered and legal owners at their addresses of record.

• Give the marina or yard a current mailing address, phone and email.
• Update the state agency too. Federal rules (33 CFR 173.29) require registered owners to notify the issuing authority of an address change within 15 days.
• If you move or the boat sits for years, check on it and the bills at least a few times a year.

If you think a storage or repair bill is wrong, say so in writing, keep copies, and pay what you agree you owe. Ask for an itemized statement. Try to agree on a payment plan, and get any agreement in writing and signed. Silence is the fastest way to a lien sale.

Read it the day it arrives and write down every date. Some examples of what notices and timelines look like:

• Florida: the marina must send written notice (in person or by certified mail) to the owner and to lienholders shown in state, Coast Guard, UCC and judgment records, and post it at the marina and on the boat. The notice has to itemize the claim and say the boat will be sold unless paid. It must go out at least 60 days before a sale. Then the marina advertises once a week for two weeks, and the sale can't happen sooner than 15 days after the first ad.
• California: after the lienholder applies, the DMV mails the owners a notice and a form. To get a court hearing, an owner must sign and return a declaration of opposition within 15 days of the mailing date. If they do, the lienholder can sell only after winning in court (it must sue within 60 days of the DMV's notice) or getting a release. The DMV also places a stop on registration or title transfer. Once authorized, the official code text says the lienholder must advertise the sale once in a local newspaper 10 to 30 days before the sale (or post notices if the county has no paper) and mail a notice of the pending sale, return receipt requested, to the owners at least 20 days before it. If you get one of these notices, that's your last practical window to pay, negotiate or file the opposition.

If you're short on time or money, call the lienholder right away, and call an attorney.

In Florida, the owner or a lienholder can pay the lien plus reasonable expenses and late interest any time before the sale and take the boat back. Expect the amount to include storage that kept adding up, advertising and other sale costs. Get a written payoff figure and a receipt.

In Florida, the marina is paid from the sale first (if its lien has priority), other secured lienholders' rights attach to what's left, and any balance is held for the owner; if the owner doesn't claim it within a year, it's treated as abandoned. If a wrecked or junked boat was left at a marina and the sale doesn't cover removal costs, the owner can still owe the difference. And under federal rules (33 CFR 173.77), your registration certificate becomes invalid when you lose your interest in the boat by legal process.

Can't afford to keep the boat at all? Before bills pile up, look for a vessel turn-in program. Some states and local agencies take unwanted recreational boats free of charge. California's program, for example, is run by participating local agencies with state boating grants: the owner fills out a release form and sends a copy of the title. Programs differ by state (some are only for boats already flagged as at risk, some run as one-day events), so ask your state boating agency. Surrendering a boat properly is far cheaper than a lien sale or a derelict-vessel case.

Lien-sale boats are often sold as is, sometimes with no keys, no records and no history, after sitting unused for a long time. Some are bargains; many need everything. Inspect it like any neglected boat (see our weathered used boat guide), and assume engines, fuel and batteries need work until proven otherwise.

The new owner has to prove to the state that the sale was legal. Florida's law lists what a buyer must submit to transfer title after a marina lien sale:

• The original bill of sale signed by the marina
• A copy of each registered or certified letter sent to the previous owner and lienholders
• A certified copy of the published newspaper notice of the sale

Florida requires the marina to give the buyer these documents when the purchase price is paid. California runs lien sales through DMV authorization and DMV forms. Whatever state you're in, ask the seller for every document the state needs, and don't pay until you have them.

Compare dates and names:

• Do the HIN, the notices and the bill of sale match the boat? Check the HIN plate (see our used-boat paperwork guide).
• Were the owner and every recorded lienholder notified? Florida requires a lien search of the state records, a Coast Guard abstract for documented boats, a UCC search and a judgment lien search, and a reasonable search of another state's records when the boat carries out-of-state or foreign numbers.
• Did the right amount of time pass between the notice, the ads and the sale?
• Is the trailer included, and does it have its own paperwork? Trailers are often titled separately, by a different agency.

A lien sale doesn't always wipe the slate clean. In Florida, a good-faith buyer takes the boat free of other claims except a prior lien perfected under state or federal law. A recorded bank loan, for example, could still be attached to the boat. Search the title and lien records yourself, as BoatUS recommends for any used boat, and for a documented boat order the Coast Guard's Abstract of Title. Ask an attorney if anything is recorded.

Give them the HIN and the state of registration. Ask: Is there a stop order or open lien sale on this boat? What exactly will you need from me to title it after a lien sale? Are there extra steps for a boat from another state or a Coast Guard documented boat? If the paperwork isn't right, the fix can be a court order or a bonded title process, which takes time and money.

File for title and registration as soon as you have the paperwork, and watch the deadline. Texas, for example, requires transfers within 45 working days or tax penalties and interest apply. Expect a HIN verification, sales or use tax and fees. Keep copies of everything; you'll need them if you ever sell.