What you should know about Coast Guard abstracts of title.
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Vessel abstracts of title are unique to the marine industry with respect to form and function. They represent the only media which affords a chronological synopsis of all ownership, mortgage, and lien recordings. Abstracts are however, only available for Coast Guard documented vessels. This is accordingly one of the principle reasons for documentation. The following information presents a general overview of what vessel abstracts are, how they are created, and their relationship to vessel documentation in general. You will also gain insight into some of the specific details with regard to content, formatting, interpretation and how to obtain an abstract .
Abstracts for documented vessels are similar to those employed in the real estate industry. Although not available for state titled boats, most agencies can provide copies or details about prior titling and registration. State records are however, not typically maintained for extensive periods upon expiration. Abstracts are available for nationally flagged foreign vessels, but these are generally referred to as "Transcripts of Registry."
When a vessel is initially documented, the National Vessel Documentation Center generates a corresponding master file that contains an index of all recordings. Subsequent filings are then scrutinized by a documentation officer to ensure they conform with statutory requirements. Those which contain deficiencies are set aside pending corrections from the submitting party. If not addressed within an allotted time, the submission will be shown on the abstract as "terminated".
Although abstracts may show certain notations with respect to the documentation status, they do not generally address such things as certificate expiration dates, trade endorsements, and other data unrelated to recordable instruments. As for vessel data, the identification numbers, prior vessel names, and manufacturer details are shown when applicable. Other status information must be obtained by ordering copies of the most recently issued certificate of documentation, builder's certificate, admeasurement certificate and related documents.
One of the primary functions of a vessel's abstract is that of identifying current and prior ownership standings. These may consist of single individuals, multiple individuals, and legal entities such as corporations, partnerships, or limited liability companies. It will also show the method of ownership with respect to the manner in which multiple parties delegated their respective equities. An abstract of title is crucial for obtaining this type of data because the exact methods of ownership are not always apparent on a certificate of documentation. Ownership recordings that meet statutory requirements may be filed even though a vessel is no longer in documentation.
Mortgage and Lien Recordings
A Coast Guard certificate of documentation does not reveal any liens and encumbrances such as secured lender interests or claimant notifications. These are recorded the vessel's underlying abstract of title as preferred mortgages or notices of claim of lien. Although mortgages gain priority chronologically according to the date filed, this is not the case with maritime claims. These are typically prioritized in favor of the date on which the most recent lien arose. Mortgages and claims are discharged by recording a respective satisfaction or release on the abstract. Mortgages and liens may not be filed unless the vessel is currently documented or in the process thereof.
Abstracts of title consist mostly of recording entries showing ownership transfers, lien claims, preferred vessel mortgages, and supplements such as mortgage amendments, assignments, assumptions, or subordinations. Such recordings also include release, satisfaction, or discharge recordings which offset claims and mortgages. Each entry indicates the instrument date, date filed, recording type, parties names, any respective considerations, and references to other recordings when applicable. There may also be an indication as to whether the filing was terminated due to recording deficiencies.
Until just a few years ago, abstracts were maintained on hard copy and entries were manually typed or notated by hand. These are now dealt with electronically and stored in digital format. Instruments such as bills of sale, vessel mortgages, and supplements are scanned into the system as a digital image and the originals are subsequently shredded. In fact, copies of most instruments can now be submitted electronically without a need for sending the originals.
Interpreting an Abstract
It requires a substantial degree of expertise to interpret various entries in an abstract of title. This holds true especially for older or commercially endorsed vessels where transactions are usually more numerous and complex. Here you will find a mix of fielding formats and layouts which have been altered over the years. Although modern abstract versions are less cryptic, you will still encounter a considerable amount of codes and abbreviations. You may therefore wish consider professional assistance under these circumstances, unless you have the time and inclination to become familiar with such factors. Another option would be to obtain a "Certificate of Ownership" from the documentation center which is a condensed version of the abstract showing only the most recent ownership and any outstanding encumbrances.
Errors and Omissions
When interpreting abstracts, it is not unusual to find errors, omissions, or inconsistencies among the recordings. However, it takes a trained eye to detect and identify the exact nature of such problems. Any deficiencies should be immediately addressed by contacting a documentation officer at the National Vessel Documentation Center. A correction will then be made if warranted and a revised abstract will be reissued.
Ordering an Abstract
Vessel abstracts of title are issued directly and only from the National Vessel Documentation Center. These can be ordered by mailing, faxing, or emailing a request form. There is also a link on the documentation center's website for doing this online. Abstracts can also be obtained by going through a vessel documentation service, which involves additional fees. An abstract can then be returned from the documentation center by email, fax or regular mail. The usual response time occurs within two or three business days according to their workload. However, this could be a matter of weeks if such records have been relegated to their archives, which is located offsite.
An abstract of title is a must-have item for any transaction involving a currently or previously documented vessel. In addition to valuable historical information, this will identify the last owner of record and any mortgages, claims, or liens that have not been offset by releases. Abstracts are not however, the ultimate solution as there could be hidden liens, non-recorded transactions, or other circumstances that may also affect the title's condition. The services of an attorney or professional titling agent should be retained whenever there are any such concerns.
Credits and References
2/5/2022 - Page initiated by Team BoatWiki.