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In a title state, like Virginia and South Carolina, one needs the boat title if it was registered in a title state. If the boat is not from a title state, a bill of sale is required.
I just went through titling a boat from VA in KY, both title states. It was a complete P.I.T.A.
If the prior owner has lost his/her title, he/she MUST request a duplicate title. Use boat reg# and the id. He/she will sign over the title to you and you can transfer it into your name.