Frequently Asked Questions

We believe that choosing to invest in your yacht for charter management, is not only making decisions based on preferences and fulfilling dreams, but it’s for many of our investors a life changing decision and new journey for them and their family for many years to come.

We are happy to have assisted over 110 new yacht owners with their yacht ownership – from different walks of life and some without any sailing experience from before. The common thread is that our investors are capable of sound comparisons to other investment or acquisitions, such as, buying a holiday home; collectible luxury goods or new luxury cars.

We therefore specialise in aiding and guiding the investor with exceptional broker support through all the stage of evaluation so to empower the buyer with the same hind-sight that a second or third-time buyer has gained from his charter management ownership.

We have put together a general FAQ for initial review where you find answers to most of your questions regarding the Yacht Charter Management of the yachting industry on how we work specifically with our services towards the industry and for your benefit.

A more detailed and costumed services targeting your preferences and managing the financing obstacles, is part of our exclusive Yacht-Matching

Please take time to visit our Yacht-Match page to start your consultancy today with a free sign up and recieve your e-broschure!

Your preferences will be at the centre of our Yacht-MAtch guidance however, there are questions to consider and expectations to manage.

What you should consider when investing in a charter boat is that it will serve both as charter boat and as a boat you can image for private use, when the charter period is over.

The link between the number of cabins and the length is key to a successful charter boat – more number of cabins have a better prerequisite for rent.

After the charter period we can recommend different re-building solutions for a more spacious boat for private use, which makes the concept ultimate. A perfect charter boat that converts into a spacious owner version at the time of takeover.

We understand the options and programmes and yacht configurations can be daunting – spending time asking a sales representative from One single charter company or yacht dealer will never give you a full insight to what is the best options for you.

The first bit of advice you will get from anyone in the industry is to buy what you can afford and the second is whether you like to place the yacht in charter with the intention to bring it home or, to have it remain in a charter fleet for its full duration.

Most companies will show you “proformas” of future potential bookings. Not good enough. Proformas can be deceiving, vague and optimistic. Insist for the real stuff. If the company has nothing to hide, they should have no problem disclosing this information to you.

As your professional sales consultancy, our position is to provide you with an unbiased comparison and analysis of your preferences.

The first step would be to look at your preferences such as your holiday plans, previous experience, family preferences and constellation, the financial investment and planning, and most importantly – a phase out plan and best-case scenario for the exit or re-investment.

Keep in mind that the trends in market will drive the bigger charter companies and yacht dealers to promote and push offers that are trend driven and seasonally more lucrative investments – without reviewing the later re-precautions. No can exactly predict the future, but we offer all our Yacht Charter Owners and investors market trend analysis data from the yacht brokering community and an ample insight into the yacht charter management industry with more than 20 years experience.

We recommend registering the yacht in a corporation because it reduces the potential of personal liability. This is also common practice in the industry and is for the most part, done by the charter operator in charge of the charter management of your yacht.

The yacht needs a yacht charter license and in most cases to acquire a license, the company which holds the yacht, needs to a proven yacht charter operator with solvency. Furthermore, applicable rules and regulations on charter licences and its flag state, implies that in most countries, the flag state and the charter license needs to be issued in the same country.

In most cases the yacht will be registered in the company of the charter operator managing the yacht for charter and the investor has a lien attached to the object. There are several advantages to this set up, as it is purely financial. After the charter period, the ownership will be transferred to the investor.

You also have the possibility to register as owner of the boat, with the same conditions for yield. But in this case, costs for handling will be charged. As a Yacht-Match Investor, you get a tailored made registration that considers your situation: whether you are a family; business, or represent a group of shared investors – we take care of the registration and give you a full scope and comparison of the different options for the different yacht charter destinations.

Is the yacht covered by insurance and how I am protected?

The yacht is normally fully insured with different parts for charter which includes the engine, loss of rent and third-party insurance. Yacht-Match will guide you and examine the specifics of the insurance offered by the qualified Yacht-Match charter operator to ensure that you have a comprehensive insurance. Most common practice by the charter operators is if there is a loan, the lender is recorded as the first loss payee and the charter company is noted on the policy for charter operations. The deductible is covered by an additional insurance policy that the charterers pay, so the owner has no exposure to a deductible unless he/she causes the damage.

The charter industry and its yacht dealers have opted to standardise the terminology for the different management agreements when purchasing a yacht for charter management into Yacht Ownership; Yacht Charter Management, or Yacht Charter Investment Programs.

The options and the variations are driven by availability of yachts from the ship yards, the available financing in the different charter destinations, and hugely on the charter demands for models and layouts.

The charter industry is taking over traditional yacht ownership and is intensely driven by demands of fleet renewal because of the fierce competition among the big charter operators to have a newest fleet and flag ships.

Yacht-Match offers tailored made investment options  for you and compares them to the markets options – so you have the best deals in front of you when making your decision for the best yacht charter ownership investment.

Here is an overview of the common investment programs you will find on the market

Full Finance – (“Guaranteed Prgm”, “Fixed Income”, “Variable Income”)

In the Full Finance investment program, the down payment required by most operators is 20-40% at the time of signing, and the rest of the amount when the yacht is being delivered.

If you invested 100% of the yacht price and you are most often given options on fixed return on investment from 8-13% and a variable (flexible) programme with 6% guaranteed yield, plus a variable part without limits.

Contracts varies from 3 seasons to 7 seasons, where you at the end of each season can exit the fleet and withdraw the yacht from charter.

Common practice is to add the cost of delivery, registration and pledge on the yacht’s sales price.

Some operators offer extensions for charter management, either year-by-year, or with re-fitting packages and then 2-3 years extensions in the same charter fleet, often with variable/flexible income structure for the investor.

Part Finance – (“Leasing”, “ Part-Investment”)

These vary in form and are inherently more complicated with more undisclosed risks for the investor.

The most common offers on the market would be yacht investment programs set up for you where it’s leasing a yacht in charter or its part financed by the yard (manufacturer of the yacht) or sometimes, the yacht financing is held by third party financing institute specialising in handling credit and loans for the yacht charter market.

The investment structure and down-payments vary depending on what the seller offers you. You will however almost always end financing 45-60 % of the yacht. With this model you tie up less capital but don’t receive any return on investment. Like any other annuity or leasing, there follows a “Bail-Out Plan” that illustrates the cost of existing the loan before its end.

Yacht-Match offers the investor a second-to-none comparison of the different financing options available. Apart from the financing options held by the yard, we offer our Yacht-Match Investor unique financing as part of the Yacht-Match consultancy.

Most commonly, the investment is treated as a loan, where If you have invested in the yacht with 100% – Full Finance and the yacht is held in the operators register as a loan with you as the investor and with a 100% lien (security). Most common lien used for the practice is the First Maritime Mortgage, which commonly perceived as the strongest security issued in the industry. This means that as a Full Finance Investor, you are receiving an annual interest rate on the loan and also amortization on your loan.

As an investor, you pay tax only based on the part that represents the interest part of the return. Some operators will offer interest free loans, with all of the annual income from charter paid back to you as an amortization on the loan. This means that you don’t have to declare anything to your local taxes (see Greek Tax Regulations).

Some other operators must include interest in the loan structure, which vary from 1%-4%, and this amount shall be entered as capital gains in your taxes.

Yacht-Match will guide you with questions local tax regulations as part of being Yacht-Match Investor. We have extensive knowledge from successfully guiding and helping more than 110 yacht owners to their preferred yacht investment. We stay up to date with the help of local tax lawyers in our target markets, through our appointed network of maritime lawyers experts and tax lawyers. The consolidation and advice is part of the Yacht-Match consultancy.

One of the great advantages of investing in yacht charter management is that you are exempt from paying the VAT on the asking price of the yacht at the time of investment.

At the At the time of the takeover to private ownership, the VAT should be paid according to the current rules. The chargeable VAT amount is the depreciated value of the boat, which is around 50-60% of the original sales price.

All of our qualified and certified Yacht-Match operators offer no hidden cost when your yacht is under yacht charter management.

As an owner and user of your yacht, you might be subject to local VAT on certain destinations (about 150 – 200€/week) and you pay for the diesel and harbour fees during your time on the yacht.

We have come across a multitude of management contracts in the industry, and we therefore urge you be vigilant about any cost that could occur if the insurance contracts or maintenance contracts are not comprehensive.

Be vigilant of the fact that most charter ownership companies state NO COSTS for the owner, however there is liability factors and costs of major repairs that not generally speaking is disclosed upfront and might be a substantially cost for both the operator and investor further down the years of management.

That is why Yacht-Match offer its consultancy to review and inform the investor about all details in the contracts and management agreement. We offer inhouse service and partner with local tax and maritime lawyers around the world.

For Full Finance investments:

Investing in a program where the yacht is placed in the charter operators register, guarantees you a strong lien. All agreements are based on the investor receiving the boat either on their own volition (e.g. termination of contracts), or if something happens to the charter operator. The priority lien on the boat is very strong, which in fact means that the investor receives the ownership within a few weeks from the application date. The boat can never be subject to distraint when 110% of the value is pledged, to the investor.

For Part Finance Investments:

Depending on the financier (lender), the take-over process differs completely.

It’s important to know the details of the contracts and what the practical implementations of a default would mean for you as the investor.

There are some general guide lines and Yacht-Match offers its Investors full explanation of the take-over process if the operator is rendered default.

Some of the leasing contracts and loans, might offer a connection agreement between the yacht owner and the lender, detailing the bail-out cost and the right of the owners to issue the bail-out.

The popularity of the leasing and part financing options for new yacht charter management ownership has dramatically increased the last 5 years, with less control and standardised.

Apart from the financing options that Yacht-Match offers you from our preferred third-party lenders, we offer our pool of current yacht investors together with new Yacht-Match Investors, the strongest security for practical reasons: If the charter operators becomes default,

Yacht-Match manages the re-placing of your yacht to a new and qualified charter operator in our network that will take over the management and monthly loan instalments.

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