Banks and other lending institutions will generally require documentation. It is only through the recordation of the First Preferred Ship's Mortgage that a lender can adequately protect its security interest in a vessel. Only upon completion of the federal documentation can the lien be assured.

is the procedure by which a vessel becomes federally registered with the U.S. Coast Guard. This procedure is available to U.S. citizens on those vessels which have a minimum hull volume capacity of 5 net tons or vessels which measure at least 25' in length.
Each documented vessel is assigned an official number which must be permanently affixed to the inside of the hull. A Certificate is then issued identifying the vessel's owner and specific facts of build.