No one buys a boat thinking that one day, they won't be able to afford it anymore.

But for those thrown against the rocks of the recession, the inability to pay monthly bills – bank note, slip fee, insurance and maintenance – can be a harsh reality.

Yet even if you are in economic trouble, there is no good reason to sink with your vessel. There are options, even when you can't float your boat.

You can sell your boat, if you are realistic about the price and willing to take the steps necessary to dress it up. You can put the boat in charter to defray the costs of ownership. Or, if all else fails, you can turn it back to the bank.

To better understand today's selling market and how to get the best deal on your boat, Mad Mariner reporters interviewed buyers, brokers and other industry experts. The result is the latest installment of our Economic Blowdown series, occasional stories that examine the economy's impact on the marine industry in general and boaters in particular.

THE MARINE GROUPMaintaining a clean, neat and orderly boat is a critical factor to ensure it has the best possibility of selling quickly and for top dollar.PRICE TO SELL

There are two ways of selling a boat: Listing it on your own, which is called For Sale by Owner (FSBO), or hiring a yacht broker. Either way, prepare for some reverse sticker-shock when listing a vessel in today's market. You need to be realistic about the price, experts say.

From runabouts to megayachts, the withering force of the downturn has decimated boat values, the primary factor when it comes to sales.

"Boat values have taken huge hits, worse than the housing market," says Chuck McMahon, a 33-year industry veteran and yacht broker with The Marine Group in Fort Lauderdale.

McMahon estimates the value of trailerable boats up to 25 feet in length is depressed by 50 percent or more; the value of 25- to 35-foot vessels is down about 40 percent; and in the 36- to 60-foot range, boats are selling for about 35 percent less. Erin Ackor, an attorney with Moore & Co., a maritime, admiralty and aviation law firm in Miami, says a client of hers recently sold a multi-million dollar boat for half of what they originally paid.

If you're determine to sell your boat, pricing is key.

"Really price it close to the bone," says Ann Avery a yacht broker with Northrop and Johnson in Fort Lauderdale. "Price as low as you can go to attract the buyers." And if that's not enough, "Keep marching the price down until the market responds. Eventually, a buyer will respond to a "˜deal he can't afford not to buy.'"

As McMahon put it, "It's like the stock market. If you buy stocks at one price and want to sell, you've got to sell at today's prices."

BROKER OR FSBO?

When going it alone, sellers have a variety options to advertise the boat's availability, including local newspapers, magazine classifieds, driveway display and – the most popular way – to list a boat is on the internet.

Experts say that boats of all sizes are 35 to 50 percent off their valuations.Boat-specific Web sites like boats.com, Yachtworld.com, BoatTrader.com, or iboats.com and buyer/seller community sites such as eBay and Craigslist give sellers control over their advertisements. Advertising rates range from about $35 to $125, and vary based on complexity and duration of the ads.

But some experts caution sellers to be careful going it alone. "There's an unknown factor when you sell a boat on your own," says Bill Thompson, an 18-year marine industry banking veteran and principal of Cardinal Points Network LLC in Strongsville, Ohio. He urges sellers to verify a buyer's funds and avoid relinquishing the boat until payment is in hand. "If someone hands you a check and the check bounces, and the boat is already gone, you're out a boat," he says.

Selling a boat solo isn't for everyone, and those who prefer a more hand-held approach have the option of hiring a professional yacht broker. McMahon says one advantage of using a broker is the formal contract that spells out terms of the working relationship, protecting both parties' interests.

Brokers don't work for free. Standard commission for yacht brokers is 10 percent of the sale price; however, in these tough economic times, Ackor says there's often wiggle room. "I've seen a fair amount of negotiation in this economy," she said.

Whether a seller chooses to hire a broker or take the DIY approach depends on the type, size and value of the boat, says Avery. Smaller production boats are probably best sold by the individual owner, as brokers typically don't list family runabouts and trailerable cabin cruisers. With larger production boats and custom yachts, and even smaller high-end vessels, it makes sense to contact a broker for help.

"It depends on the dollar amount," Avery says. "At a certain level, it's just not worth your time – for the seller or the broker." Sometimes, she explains, "You don't need the middle man."

If you hire a broker, make sure your boat is listed with an aggressive, experienced agent, McMahon advises. Experienced brokers have the proper connections, resources and staff to get a boat sold as quickly as possible. And beware of low-rent brokers, individuals who claim experience but are not connected with a noted firm and operate out of their own backyards. "The industry is flooded with them," he says.

McMahon recommends contacting trade organizations like the Yacht Brokers Association of America, Northwest Yacht Brokers Association or the Florida Yacht Brokers Association to find reputable, experienced brokers. You may also want to seek out a Certified Professional Yacht Broker. It's a relatively new certification program intended to set a performance baseline for professional yacht brokers nationwide. McMahon, a founding member of the program, says more than 500 yacht brokers throughout North America have earned a certification. A list of CPYB agents is available at www.CYPB.net.

THE MARINE GROUPBefore selecting a yacht broker, experts recommend doing some homework to find a reputable, experienced agent than can make your boat visible in the marketplace.FIXING UP

Remember: When selling a boat, time counts. Once you make the decision to sell, ensure the boat is in pristine shape quickly list it as soon as possible. "Speed is the key issue," says McMahon.

Remove items that are not part of the sale inventory. Fishing tackle, your father's treasured binoculars, expensive tools – if they're not part of the deal, get them off the boat before potential buyers make false assumptions. "What a buyer sees, a buyer expects as part of the sale inventory," McMahon says. "I once saw an argument over a vacuum cleaner."

To minimize loss without breaking the bank, consider spending money on well-chosen upgrades. Replacing dirty carpets is a good place to start. "It's a modest investment, but one that will pay off handsomely," McMahon says. Canvas, cushions and exterior fabric are worth the cost to give buyers a solid first impression of your boat. If these items aren't up to snuff, "Buyers will take that into account in their offering price," he said.

Another piece of advice: "If it doesn't work, fix it or get it off the boat." If your boat has three radios onboard and only one works, McMahon suggests repairing or scrapping the other two. Concentrate on the simple things: replace burned out light bulbs and rusty hose clamps; tidy the engine room; clean the bilge; and get rid of stagnant sea water. If you remove onboard equipment and a gaping hole remains, properly fill it and use appropriate marine equipment to do the job, he recommends. Shortcuts and sloppy patch jobs are sure to negatively impact potential buyers.

It is also critical to guarantee the boat is in good running condition. Be sure batteries are fully charged, fuel filters and oil are clean, and sea water impellers are in top shape. "You don't want your boat to earn a bad reputation," McMahon says. "I've seen some very expensive boats with huge problems for something as simple as a battery."

CHARTER POTENTIAL

If you are not keen on selling or can't find a buyer, another option to help alleviate the burden of expensive monthly payments is to offer the boat for charter.

Chartering your boat is a good way to protect the investment, says Barbara Hansen of Southwest Florida Yachts in Fort Myers, Fla. She and her husband, Vic, launched their business 25 years ago, which includes a charter fleet of 20 boats, both sail and power, which range from a 24-foot daysailer to a 43-foot motoryacht. Interest from boat owners looking to charter their vessels for the first time is on the rise, Hansen explains, an increase she largely attributes to the current economy. "We've been getting a lot of inquiries recently," she said.

THE MARINE GROUPSellers need to be realistic on price when listing their boats, brokers recommend. Often, investing a reasonable amount of money in basic upgrades before going to market can make a big difference.But chartering your boat won't eliminate costs altogether. Despite the potential to reduce certain expenses, Hansen warns boat owners considering this option that costs are still involved. Charter isn't intended to help boat owners make money on their boat; rather, she explains, it simply helps owners afford to keep it. "Chartering is an option for the long-term; it's not a short-term solution," Hansen says. To a certain extent, charter boats require an even higher level of maintenance."

Hansen says chartering a boat allows owners to continue using and maintaining the vessel while helping defray certain expenses such as dockage, insurance and routine maintenance. Typically, these expenses set boat owners back anywhere from 10 to 20 percent of the boat's total value, based on its age, the sophistication level of the equipment and the overall complexity.

Owners of a vessel valued at $100,000 can expect to spend about $23,000 per year on operating expenses, Hansen says, but offering the boat for charter in her fleet would reduce those annual costs to about $7,000. There's also a one-time entry fee of $1,500 to join the program.

Boats in the Southwest Florida Yachts fleet are expected to have certain amenities, including refrigeration, air conditioning, generators, VHF, GPS, depth sounders, televisions, DVD players and stereos, to name just a few. Individuals looking to charter vessels that don't have these features onboard need to add them or update as necessary – and that means up-front costs for the owner. "We've never put a boat in our fleet where the owner didn't have to spend some money," Hansen says.

BACK TO THE BANK

If a boat owner has already passed the point of no return and solutions like sale and charter are off the table, Thompson says owners have the option of returning their boat to the bank. Turning in the boat is considered a "voluntary repossession" and, while it is a better option than having the bank forcibly reclaim the boat, it's important for owners to understand that voluntary repossession will impact their credit rating.

"Even when you do the right thing there's going to be a negative effect," he says. The repossession will remain on your credit report for seven years from the time you repay any balance still owed on the boat.

When repossession is your only recourse, it is imperative to keep the boat clean. In repossession cases, owners have a tendency to stop caring for the boat if they believe they're in danger of losing it, Thompson says. "Take care of the collateral," he says. "Make sure it's in good condition. The better condition the boat is in, the better price the bank can get selling it."

Also, "Resist the urge to strip the boat," he cautions. Removing electronics and other valuables onboard not only lessens the boat's value and contributes to depreciation, but if they were part of the financed boat, then on the boat is where they belong.

Thompson's advice: be honest with your lender. Owners shouldn't be afraid to ask their financial institution to change payment due dates or possibly restructure terms of the loan. Banks are often willing to negotiate because the last thing they want is to get stuck selling your boat for you.

At that point the bank is at a much greater risk of losing money, forced to offload the boat in a distress sale where today they are likely to get only 50 to 60 percent of the boat's value. "It behooves them to keep that boat in the customers' hands," Thompson says.

The worst thing a boat owner can do, Ackor says, is fight the bank. "Fighting doesn't work," she maintains. "They have all the cards. People who don't cooperate with the banks are the ones that really get slammed."