While auctions and claims are the two most popular methods of acquiring horses, they may also be purchased privately. Private transactions offer the buyer value and opportunity as well as the option of a pre-purchase exam. Furthermore, the purchaser is not restricted to only those horses offered for sale, but may make an offer on any horse considered desirable, including those which are not necessarily advertised for sale. Again, consultants play a vital role in finding, selecting and inspecting prospects.
As with other purchase options, proper pre-purchase arrangements must be made and various factors should be considered.
1. Make an inquiry regarding purchase opportunities.
If you are interested in purchasing a particular horse, contact the horse's owner, trainer or owner's agent and inquire if the horse is for sale.
2. Inspect the horse.
After ascertaining that the horse is for sale, a thorough physical examination should be conducted. Follow the same guidelines as those associated with inspecting horses at public auction. If you are serious about the purchase, employ a veterinarian to perform a physical examination evaluating the soundness, general health, wind capacity and reproductive ability of the animal.
3. Negotiate price.
The sale price should reflect the quality of the horse's pedigree, conformation and race record. To determine an offering price, evaluate the following factors in addition to the three previously mentioned:
When a purchase price has been determined, make a formal offer.
4. Present a Written Agreement of Sale or Purchase and a Bill of Sale.
A written Agreement of Sale or Purchase should be prepared and should include the names of the parties, identification of the horse, terms of sale, warranties of sale, contingencies and deadlines and site of the transaction, as sales tax may be a factor. It may be prudent to also include a procedure for resolving disputes, as well as a provision acknowledging the right for a complete veterinary examination. In most cases a veterinary examination is required by insurance providers before a policy will be issued. Where questions or suspicions exist, good business practice suggests that a title search should be made to ascertain that the seller's title is free of liens.
Upon acceptance of the offer, the purchaser should request a Bill of Sale. A Security Agreement may be imposed by the seller to secure payment if the seller finances any portion of the purchase price. At the closing, the purchaser should receive the horse's Jockey Club Certificate, as well as copies of its health records.