Pros and Cons of Boat Documentation

Many commercial vessels are required to have US Coast Guard boat documentation. Typically, these are vessels measuring over 5 tons that deal in commerce or trade on the US coasts, the Great Lakes, US Fisheries, or other American or Exclusive Economic Zone navigable waters.

However, plenty of other commercial, recreational, and pleasure vessels qualify but are not required to receive a Certificate of Documentation from the US Coast Guard. If you’re an owner of one of these boats, you may be weighing the pros and cons of getting this certification. 

Cons of Boat Documentation

We’ll start with the disadvantages of US Coast Guard documentation because it’s short and simple. The cons are pretty much financial.

Documenting comes with fees. There is an initial documentation fee, as well as specific state and local costs (including numbering fees, boating fees, taxes, and sometimes a registration fee). This can cost a few hundred dollars, plus any later fees related to renewing, transferring, or replacing your Certificate of Documentation. Vessels with documentation will also need to be appropriately numbered and labeled with name and hailing port designation, which is not necessarily a significant cost but it is not negligible. 

Documented vessels also have clearer financial histories. Claims of liens and mortgage histories are usually filed with the boat’s documentation. This is better for potential buyers and lenders but can be a disadvantage for an owner in a current state of financial disarray.

Pros of Documenting your Vessel

Most simply, US Coast Guard documentation is the most prestigious registration possible. It grants multiple benefits and protections, especially in foreign waters. Also, if you have any commercial ambitions for your boat, you will likely want to document it in order to legitimize your business. Here are just a few benefits of boat documentation.

Clear Ownership

Documentation creates a clear chain of ownership. This makes owning a maritime vessel much simpler and more transparent. It ensures that buyers and lenders are aware of possible liens before purchase.

Relatedly, documentation also comes with an official number designation from the Coast Guard. This number must be permanently and prominently affixed to the maritime vessel’s hull and won’t change throughout the boat’s lifetime. In the rare chance of theft or ownership dispute, this number can be traced to the boat’s proper owner.

Cost Savings

While the documentation does include additional costs, these fees are very frontloaded. Renewal costs are often negligible. Vessel documentation may also let an owner be exempt from certain state and local registrations. This can save money and time.

A documented vessel also helps boat owners in certain financial situations. Documentation legitimizes the vessel, so lenders treat it as a more secure form of collateral. This helps get better financing and mortgage rates, which can contribute to significant long-term savings.

Protections from the US Coast Guard

If you have ambitions for offshore cruising, this may be the most important benefit of boat documentation. It gives you peace of mind when traveling, as the nationality of your vessel is obvious to other ships and coast guards you encounter.

Plus, it makes clearances into foreign ports easier. State registrations typically won’t provide this benefit. The certificate of documentation is treated as a form of registration, helping owners get through customs entry and clearance faster.

Still on the Fence? Contact Maritime Documentation Center

Here at Maritime Documentation Center, we know that every case is different. While we typically recommend documentation when owners qualify, we wouldn’t want you to waste your money. Check out some of our Vessel Documentation FAQs to learn more and, while you’re there, you can chat with our online support person during business hours to answer any questions you may have.