§ 508 Vessel Lien Assignment Rules

• •A lien for boat repairs, labor, supplies, storage, or safekeeping can be transferred to another person.
• •The transfer must be done with a written document and by giving the boat to the new lienholder.
• •The person who transfers the lien must notify the boat’s registered and legal owners by hand delivery or certified mail, and include the new lienholder’s name and address.

A boat repair shop repairs a yacht but the owner hasn’t paid. The shop sells its right to collect the money to a collection company.

Because of this law, the repair shop can hand over the paperwork and the boat to the collection company, and the collection company can now demand payment just like the shop could. The shop must also send a notice to the yacht’s owners telling them who now holds the claim.