The questions to ask before you buy
Ten questions to put to every party in the transaction before signing anything, the order in which to hire the team, and the test to apply to anyone proposing to advise. Including us.
The ten questions
A one-page checklist to apply before signing anything. Every question has the same shape: it asks who pays whom, because in this industry the payment structure, not the relationship, is what predicts the advice.
- Who introduced the yacht (or yard) to me, and who pays them?
- Who recommended the lawyer, and who pays them?
- Who recommended the surveyor, and who pays them?
- Who recommended the management company, and who pays them?
- Has any party offered to provide their services “at no cost,” and if so, who is paying them?
- Has every party I am working with disclosed their commercial relationships in writing, including referral fees, retrocessions, and equity holdings in counterparties?
- Is my legal counsel independent of the broker, the yard, and the management company, and is their fee paid by me directly?
- Is my surveyor independent of the seller and of the broker, and is their fee paid by me directly?
- If I am building, is my owner’s representative paid solely by me, with no contingent fee, no yard commission, and no referral relationship?
- If I asked any of these parties to walk away from a deal that would not benefit me, would they?
A buyer who can answer all ten clearly, with documentary evidence, is exceptionally well-protected. The buyer who cannot is, by industry default, operating inside the structure described in chapter 3. That is information rather than judgment.
Why these questions work
The commission structures that fund the yacht industry are lawful and disclosed in outline, but rarely disclosed in full. The seller pays the brokerage commission; retrocessions and referral fees move between parties the buyer never invoices; and dual agency places one firm on both sides of the table. None of the ten questions accuses anyone of anything. They convert undisclosed structure into disclosed structure, in writing, which is the single cheapest protection available to a first-time buyer.
The questions are drawn from chapter 9, the decision framework, where each is developed in full alongside the suitability test for matching a firm to a specific project. The chapter checklist is the printable version.
The hiring order
The order in which the buyer hires determines the quality of every subsequent decision, because each early hire selects the later ones. The right order:
- Independent adviser, engaged before any broker, captain, or management company, to scope the acquisition and build the rest of the team.
- Specialist yacht counsel, engaged before any contract is reviewed.
- Independent surveyor, engaged per deal once a shortlist exists, paid by the buyer.
- Captain candidate, hired through routes independent of the broker and involved in survey, sea trial, and acceptance.
- Yacht management company, engaged once the acquisition decision is taken.
- Insurance broker, engaged once flag state and operating profile are determined.
Total team cost on a USD 30 to 50 million acquisition runs USD 200,000 to 600,000 across the first year, a rounding error against the transaction. Owners who economise here save tenths of a percentage point and lose multiples in the asset itself. The acquisition process in chapter 4 shows where each hire enters the 12 to 24 week sequence.
The independence test, in brief
Six elements, applied to any adviser: no income contingent on a closed transaction; no equity, employment, or referral relationship with yards, brokers, suppliers, or management companies; a published counterparty list; fees quoted in writing in advance; professional indemnity insurance at transaction scale; and named, accountable principals. For an owner’s representative, the Yacht Owners’ Register of Representatives is the cross-industry vetting filter to apply alongside the test.
The test applies to the publisher of The First Owner’s Reference like anyone else; the publisher’s own answers are on the colophon.
Frequently asked
- What questions should I ask before buying a yacht?
- Ten questions, applied to every party in the transaction before signing anything: who introduced the yacht and who pays them; who recommended the lawyer, the surveyor, and the management company, and who pays each; whether any party has offered services at no cost and who is actually paying them; whether every party has disclosed commercial relationships in writing, including referral fees, retrocessions, and equity holdings; whether counsel, surveyor, and owner's representative are each independent and paid directly by the buyer; and whether each party would walk away from a deal that did not benefit the buyer.
- Who should I hire first when buying a superyacht?
- An independent adviser, engaged before any broker, captain, or management company. Then, in order: specialist yacht counsel before any contract is reviewed; an independent surveyor once a shortlist exists; the captain candidate through routes independent of the broker; the yacht management company once the acquisition decision is taken; and the insurance broker once flag and operating profile are set. Total team cost on a USD 30 to 50 million acquisition runs USD 200,000 to 600,000 in the first year. Most first-time buyers hire in the reverse order.
- How can I tell if a yacht adviser is independent?
- Six tests: no income contingent on a transaction closing; no equity, employment, or referral relationship with any yard, broker, supplier, management company, or charter operation; a published counterparty list for the past three years; fees quoted transparently in writing in advance; professional indemnity insurance at a level appropriate to the transaction; and named, traceable, accountable principals. A firm can fail these tests and still provide value, but it should not be relied on for independence.
- Is a free yacht advisory service really free?
- No party in a yacht transaction works without payment. A service offered at no cost to the buyer is being paid by someone else in the transaction, typically through commission, referral fees, or retrocessions, and the adviser's structural loyalty follows the payment. The question to ask is not whether the service is good but who is paying for it, in writing. If the answer is anyone other than the buyer, weight the advice accordingly.
- What is the walk-away test for a yacht adviser?
- Ask whether the party would walk away from a deal that did not benefit the buyer. A party paid only by the buyer, with no contingent fee, can afford to advise against proceeding; a party paid on closing cannot. Firms able to point to engagements they declined or terminated, because the right advice was not to proceed, have been tested. The willingness to walk is the truest signal of alignment with the buyer.
This page is the one-page companion to chapter 9 of The First Owner’s Reference, where the ten questions, the independence test, and the suitability test are developed in full. Cost questions run through the running cost calculator.