In conversations with our clients and friends with whom we meet as a result of our work in Europe and the United Estate, we often notice some apprehension about the process of buying property in America, since for many this is a totally unknown issue. Fortunately, we are able to offer information that comforts everyone we talk to, since the process is truly incredibly transparent, simple and easy - when compared to that of many European countries.
In addition, buyers in the United Estate breathe a sigh of relief upon learning that there is no place for the dreaded gazumping in a transaction of a Floridian property, that is, when the seller agrees to sell a property, but then sells it to a third in more favorable conditions. Once an offer is accepted here and money is deposited, unless something resurfaces during the due diligence process, which results in the breach of the contract, you can be confident that the sale will continue. For many Britons, this is the opposite of what happens with the purchase in the UK where, you can only feel confident when you have the keys in your hands on moving day!
In order to clarify what exactly makes up the sales process we have created this guide for the purchase of properties in Florida, to truly demonstrate its simplicity. For a more in-depth explanation of each part of this process, from the search and purchase of a property, to its lease, please refer to our book Your Florida Real Estate Investment Guide for Global Buyers .
GUIDE FOR THE PURCHASE OF PROPERTIES IN FLORIDA
STEP 1 - CONTRACT A FLORIDA REALTOR
We have written a lot about this and constantly advise our readers to hire a Realtor to represent them, as it is the most important decision they will make when buying a Floridian property, (except for choosing the home) Read more about how the right Realtor will make the process easier and how it costs you nothing here, like the buyer. But believe us, this is the first important step. The right expert will make sure to put in your hands every piece of information at the beginning of your search, and will guide you through every possible aspect of the process of buying a property.
2ND STEP - FIND A PROPERTY
Start your search. Prices are rising steadily and the business you can get today may not necessarily have a good price tomorrow. Your Realtor has access to the Multiple Listing Service or SLM will use your expert skill continuously to find listings that fit your criteria and lifestyle goals, but you can also be proactive and complete your search online.
The more properties you see, the more aware you will be about the price points and what you really have in your budget. When you search online, be prepared to hear the feedback and advice your Realtor offers regarding neighborhoods and streets, since he or she is an expert in the area and has the experience of knowing if something is too good for you. To be real, has a price that is too high, or is not in the right place according to your requirements. Your Realtor's knowledge about the local area will be invaluable to help you with this part of your career. Did you know the sell my house services is called webuyswflhomes.com
Once you have found some listings that can serve you, we regularly recommend that you go to see them personally. In Florida, you have the option of visiting homes for sale without having to make appointments (Open House) or your Realtor can schedule appointments for you with the listing Realtor. If you cannot come to Florida, then it is essential that your Realtor conducts himself with the highest standards and have impeccable knowledge of the location and market information!
STEP 3 - MORTGAGE SIMULATION (IF YOU WILL PAY IN CASH, ADVANCE TO STEP 4)
The other important step in buying a home is, of course, to have the backing of financing if you need it. Before you begin your search for the property seriously, it is a good idea to get prior approval for a mortgage loan, in case you see something that really pleases you. Without the conditioned consent of the credit institution to lend a certain amount, you would not be with certainty the first option of the seller in case there were several offers, and you really would not know for sure if you could even afford to buy the property , or get a mortgage loan.
Please note: a mortgage simulation is not the same as a binding mortgage offer. The mortgage simulation means that you have provided a credit institution with the details of your income and your financial debts and they have estimated your purchasing power. The binding mortgage offer means that they have actually checked their credit report, and their percentage of family debt, and have correctly analyzed their financial situation. Once they have done this they provide you with a letter containing the binding mortgage offer. This can certainly help you seal the business when you enter into negotiations with a seller, and it indicates that there is a good chance that you will get a mortgage and that the sale will be made.
STEP 4 - HOW TO MAKE AN OFFER
Once you have found the right property, read the entire Notice of the Seller, and prepare to act on it; The time has come to compose an offer. In Florida this is done with a formal contract in which the specific requirements and specific terms of the buyer and seller are presented. Some Realtors may, in the first instance, contact the seller's Realtor by communicating an oral offer, in order to test how the other party would respond before taking time to put something in writing. From our perspective, we strongly encourage you to submit all offers in writing from the beginning. Offers submitted in writing are usually considered more seriously by virtue of the fact that the terms are written.
Obviously, the seller does not have to accept the offer, even if you offer the full price of the listing. And sellers are not required in any way to explain why they reject a particular offer. We almost always find that most buyers receive a response in a couple of days, and in most cases the seller will let them know if the offer was too low, which is where the negotiation begins! At this point you can wait for the right moment and bet to see what happens, or you can increase your offer with the hope of securing the property immediately.
5th STEP - ACCEPTANCE OF THE OFFER
The minute you learn that your offer has been accepted is listed as one of the most exciting moments in life. It is important to stay focused, as there are still many steps in the stage of due diligence that can uncover issues or problems on either side. As with much in life, as far as real estate business is concerned, the intrinsic is in the details.
After your offer is accepted, if you have not yet placed the guarantee money, you are expected to do so when signing the contract. Always keep in mind that the guarantee money could be at risk if the seller does what he or she is required to do under the contract and you do not. Depending on how the terms were specified in the contract, usually within the first days after the execution of the contract, you will put the remaining deposit for the property. Then, it is time to start checking the contingencies specified in your contract, and it is here that your Realtor's ability, and the quality of the equipment he or she has assembled becomes paramount.
STEP 6 - CONTRACTS
The purchase contract must be drawn up by your Realtor with all the details and signed by you. In many cases, buyers are asked to place a "money in guarantee" which is a small amount of the deposit, to show that they are seriously interested in the purchase. Keep in mind that if your offer is accepted and then you leave the business, if there are no necessary provisions in the contract, you will lose that money.
There are two main types of contracts to buy a property in Florida. The standard contract provides that if there are problems that were not previously discovered during the inspection, the seller is obliged to repair the guaranteed items and a default of 1.5 percent of the purchase price for repairs is provided.
We prefer to work with the alternative, the contract of sale "in the condition in which it is found." With this type of contract, if the inspection reveals problems with the home, the seller is not obliged to make those repairs. This means that the buyer has more flexibility to leave the contract, if they decide that the house is not for them, and it is the only contract that allows the buyer to receive a full refund of the deposit if they do not like something that arises as a result of the due diligence stage. The contract includes:
The price you are offering for the property
The percentage or amount of money in guarantee that you will deposit (a part of the initial deposit), and the value of the total deposit that is due at the end of the due diligence process (usually 10 percent)
Seller's response period to the offer
Proposal of the Formalization Date. In Florida, most formalizations occur within 30 to 45 days from the start of the contract. This can vary greatly, however, depending on specific circumstances.
Number of days allocated for due diligence.The default number in standard contracts is 15 days
Limits for repairs. This applies if you are not using a contract "in the condition you are in."
Contingency for financing and financing term. It must be stated in the contract that the sale will only be consummated if your mortgage is approved, and you must specify the maximum interest, and the terms of the mortgage you accept.
Inventory of items included in the purchase.
STEP 7 - FORMALIZATION OR CLOSURE
You will attend the closing meeting (or your Realtor will go instead) with the formalization agent or real estate attorney. Everything will be discussed and you will sign the documents, and your Realtor or lawyer will verify that everything is in order during the process. The funds will then be transferred from the escrow account and you will receive your keys. Congratulations, you are now a homeowner in Florida!
