Purchasing Real Estate in the Florida Keys
Hire a good Realtor – interview your agent. We work for you. We want to use our experience and resources to help you find the perfect home.
Be prepared – have an idea of the features you’d like in your home. Are you interested in a property on the water or does having a spacious yard appeal more to you? Knowing what you’re interested in will help your agent in finding what best suits your needs.
Budget – how much do you want to spend? Put together a financial plan. Know how much you are able to pay monthly including taxes & insurance.
Look at homes – this is the fun part! Your agent will show you listings that meet your criteria.
Put an offer on the table – you’ve found your dream home. Now it’s time to make it yours.
Inspections – inspections are at the buyer’s expense and must be completed in the time frame specified in the contract. The selection of inspectors is your decision.
Title Insurance – this protects you from loss that may occur from matters of the past. This allows you to protect the equity of your new home from financial loss that occur from fault or interest you may have in the property.
Appraisal – this is a third-party estimate of the value of the property. You may want to consider including an Appraisal Contingency with your offer to assist in resolving any issues that can arise from the appraisal.
Insurances – with financing you will be required to carry homeowners, windstorm and flood insurance. There are other options you may want to discuss with your policy providers. Insurance policies cannot be obtained if there is a hurricane or tropical storm threatening the Keys.
Walk through – following the closing you will do a walk through to make sure the home is in the same condition as when you signed the contract. You will also make sure any of the repairs required have been completed.
Closing – upon closing you must settle all costs incurred during the transaction. Some of these may include attorney fees, survey charges, escrow fees, etc.
Pick up the keys – buying a house can be a tedious process. Now it’s time to enjoy all of that hard work!
You’ve purchased your new home, now what?
Utilities – your agent will provide you with a list of utility companies you will need to contact to have the utilities in your new home turned on. You will be required to provide proof of ownership. When purchasing a new home, you will also be required to show the Certificate of Occupancy.
Keys & Locks – many people find security in replacing the locks on the exterior doors of their new homes.
Homestead Exemption – you will need to file your homestead exemption prior to March 1st. If you fail to do so there will be an increase in your taxes.
Change of address – you will want to make sure your new address is updated with your current billing companies as well as family and friends. Florida law requires change of address on your driver’s license to occur within 30 days.
Meet your neighbors – take the time to meet the people living around you. Let them tell you about the neighborhood. The sooner you get to know them, the more your new house will feel like home.
Landscaping & pest control – you may want to look into having someone maintain your property for you. It is usually easier to prevent an issue as opposed to treating one.
Normally closing costs range from 1.2 to 3.5 percent of the total sales price. Closing costs can include but are not limited to: title insurance, title search, attorney’s fees, escrow fees, notary fees, wire fees, courier fees, home inspection, recording fees, document preparation, appraisal fees, endorsement fees, transfer fees, property tax, and flood insurance and home owners insurance (as required).
In the current market, most U.S. lenders typically require a 50 – 60 percent down payment for foreign buyers to obtain a mortgage loan. At 50 percent down, mortgage rates become more attractive and terms may be better (i.e. reduced documentation, reduced costs and easier underwriting).
In Miami-Dade County total property taxes usuallyrange from 1.8 to 2.7 percent of the property’s assessed value, but this varies by municipality andother factors.
Currency Exchange & International Payment of Mortgage
Trading and transfer fees can be quite high when using a bank or mortgage lender. Use of a foreign exchange and international payment specialist will ensure you receive the best rates possible and that your payments arrive when and where you need them.
Condo or Homeowner Association
(HOA) Maintenance Fees
When considering maintenance fees, it is important to remember that U.S. condominiums and HOA’s typically offer many more services than those in other countries. South Florida properties offer many more amenities than in most other U.S. locations, including pools, exercise rooms, tennis courts, parking garages, security and more. These amenities all become assets as well as benefits during ownership and at sales time. Condominium or HOA fees can include many or all of the following and vary depending on the amenities offered, age of the property, and number of owners sharing the costs: insurance, common area electricity, water sewer, trash removal, pool service, gym maintenance/equipment, repairs/ maintenance – building, plumbing, grounds, and pool, pest control, parking and/or valet services, package services, room service, concierge, room service availability, bellman service, onsite restaurants, and shops.
If funds are not available for large maintenance items (i.e. roof, air conditioning) or for updating and improving the property, then cost may be assessed in addition to the regular condominium and HOA fees, to all owners based on their percentage of ownership.
What Is an REO?
Real Estate Owned (REO) property is a real estate asset owned by the lender that is taken back during the foreclosure process. Foreclosure is the legal process by which a defaulting borrower is deprived of their ownership in the property.
What Determines the Discounted Price?
Like regular properties for sale, the price for REOs is mainly determined by: Condition of the Property,
Location, and Comparable Sales and Values.
Pros and Cons of REOs
Typically buyers of REO properties have to be less concerned with clouds on the title, back taxes, or other last minute, closing surprises, as the lender almost always takes care of them before closing. By the same token, REO properties are traditionally sold “as is”, meaning the lender who owns the property does not or will not repair damages or correct code violations that may exist. Still in today’s real estate environment where lenders want to dispose of properties as quickly as possible, some lenders are willing to compromise on the “as is” purchase of an REO. You can always have your agent ask for these concessions as part of your offer.
Pros and Cons of Short Sales
A short sale is a difficult process for both sellers and buyers. Most people are not aware of all of the details the process entails. Buyers should make sure to consult professionals who have a history of success with short sales. Lenders are notorious for taking a long time to approve short sales. If a property has liens, second mortgages or a home equity line of credit, each applicable party has to be consulted for approval, which can take up a considerable amount of time further prolonging the process. The successful transaction also depends on a good offer from a qualified buyer.
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