Buying Property in Florida - What's Next?

When you submit your offer, you'll be required to pay a deposit.  This money is held in an escrow account (an account held by a neutral third party - in order words, not held by either the buyer or the seller).   The deposit is generally held by the agent or the closing attorney.  This is used towards the sale price and is not an extra charge.

Note: Escrow is a term which might confuse some European buyers mainly because it's not one that's typically used in the UK, for example, while it's common in the Czech Republic.  You can read more on this here: Escrow from Wikipedia.

One important thing to mention here is that if you're a foreign national looking to buy in the USA, you really should establish a bank account there.  Most sellers, especially institutional sellers like banks, won't consider an offer if you can't prove you have the funds readily available.  Saying you have the funds in a European bank account won't mean much if it takes a week to get the funds transferred.  Generally speaking your local agent will ask for this (a recent bank statement, for example) to be submitted along with your offer. 

If you're making an all cash offer, once your offer is accepted you will have as many days as specified in your offer to make inspections, get condo association approvals, etc.

Once that's all done and you're satisfied with the information you've received you can proceed to closing.  You will be provided with a good faith estimate in line with The Real Estate Settlement Procedures Act (RESPA) outlining who pays for what at closing.  

NOTE: RESPA is about closing costs and settlement procedures. RESPA requires that consumers receive disclosures at various times in the transaction and outlaws kickbacks that increase the cost of settlement services. RESPA is a HUD consumer protection statute designed to help homebuyers be better shoppers in the home buying process, and is enforced by HUD (the US Department of Housing and Urban Development).

There are usually two columns on the good faith estimate - buyer's side and seller's side.  You'll see all the costs delineated on the form with totals on the bottom.   Besides the purchase price, you will be responsible for prorated property taxes, for example, utilities and home owner dues, if applicable and/or if any are outstanding.    Your local agent will go through this with you and make any corrections and notify the closing attorney.

The closing will be scheduled and either you or your representative (empowered by a power of attorney) will be present along with the seller and your respective agents will be there.  You'll need to have certified funds with you.  Your local US bank can provide you with a certified check.  You sign it over to the closing attorney, sign the closing documents and receive the keys to your new home or condo.  Possession is immediate in the US.


Are you looking for US investment property at a discount? Are you looking for a discounted short sale or bank owned property?  John Breaux can be reached at john@marathon-group.cz or +420 602 355 810 or +1 504-208-4331.

Buying Property in Florida - part deux

Once you've found a property you feel meets your investment requirements your agent will help you write an offer. The Offer to Purchase Real Property or "Offer" is written on a State approved form which, more or less, allows for only fill-in-the-blank details.

These are just some of the important provisions included in this Florida Residential Real Estate Sale Contract:

• Parties: Identifies the Seller and Buyer involved in the transaction;
• Property to be Sold: Specific property being sold, including a legal description;
• Price and Payment: The price for the property and when and how payments are to be made;
• Earnest Money and Other Deposits: How the earnest money is to be kept and handled ;
• Contingencies: Allows certain contingencies with regard to the property. This includes if the buyer is getting a mortgage;
• Removal Of Contingencies: What happens if contingencies are not removed;
• Time For Acceptance And Effective Date: Time by which offer needs to be executed by both parties;
• Condition of the Property: Defines the condition of the property and whether or not the property is being sold "AS IS" or subject to any repairs;
• Inspection: Mechanical, Pest and other inspections ;
• Radon and Lead Paint Disclosure: Disclosure about Radon testing and Lead Paints;
• Utilities: How utilities will be handles;
• Casualty Loss: Defined who bears the risk of loss;
• Title: Transfer of title from seller to buyer;
• Existing Mortgages: Seller shall furnish to Buyer a statement from all mortgagee(s);
• Professional Survey Engineering Plans And Studies: Whether a survey shall be made and the furnishing of all plans;
• Delivery Of Deed: When and how the Deed will be transferred;
• Closing And Possession of Property: Time and manner of closing and when possession occurs;
• Restrictions, Easements, Limitations: The various easements, restrictions and limitations of the property - if any;
• Obligations of the Parties at Closing: Seller's and Buyer's obligation at closing;
• Closing costs: A checklist for who is responsible for which closing costs;
• Defaults And Remedies: What happens in case of defaults and any remedies;
• Disputes: Sets forth how disputes may be settled.

It is possible to add something that is not contained within the formal Offer. An example could be a list of furniture or fixtures that the Buyer may want. The document used for this purpose is called an "Addendum" and is attached to the Offer. It becomes a part of the transaction once signed by both parties.

In recent years, it has become common place for the Seller to provide the Buyer with a list of known defects, conditions or any other information concerning the property. This "REAL ESTATE DISCLOSURE STATEMENT" is not a warranty of any kind by the seller and is not a substitute for any inspections or warranties the Buyer may wish to obtain. It is merely a declaration of what the Seller knows regarding the property.

The results of the negotiations between the Buyer and Seller concludes with an agreement on price and terms and at that time an agreement between the two parties exists. This final agreement is called the "PURCHASE AGREEMENT" or "PURCHASE CONTRACT" and acknowledged by both by signing the document.



Are you looking for US investment property at a discount? Are you looking for a discounted short sale or bank owned property?  John Breaux can be reached at john@marathon-group.cz or +420 602 355 810 or +1 504-208-4331.

Buying Property In Florida

The next few posts will be my attempt at introducing my European clients on how to buy US real estate.  I'd like to try to help bridge the gap between the European and American ways of buying property. How doing business there, while different from what you’re use to, is easy and almost always a totally transparent transaction.  I’ve met with or spoken to several people interested in Florida real estate specifically so I thought I'd put together a guide of sorts to help them and hopefully you as well.

The first thing to know is that all agents (called Realtors in the US) have to be licensed in the State where they’re doing business.  They must attend licensing classes and pass a State issued exam before a license is issued and every few years they must attend continuing education classes то maintain their license.  This really legitimizes how business is conducted.  If an agent fails to disclose a problem with the property or makes a mistake, he/she could lose their license and be out of work. Moreover, with the US being such a litigious environment, agents go out of their way to make every part of the buying process completely transparent.  Everything must be disclosed thereby protecting property buyers from future problems.

Many of the better agents go on to learn more about the property business by attending classes geared to their specialty.  You should look for agents with these designations in order to know you're doing business with a professional.  Designations include CIPS (Certified International Property Specialist), CRS (Certified Residential Specialist), GRI (Graduate of the Realtors Institute) or CCIM (Certified Commercial Investment, Member) which is among the most sought after designation amongst commercial agents.

But probably the biggest difference between the US market (any US market actually) and most EU markets is that each US market has what’s called the Multiple Listing Service (MLS).  These are Realtor database listing systems which almost every US agent uses to list their properties (commercial agencies rarely use the MLS).  

Every

Typical MLS Listing Page

listing – and listings are almost always an Exclusive Listing - is input into the system and allows all agents to have access to all the listings in their area, regardless of who actually has the listing.  This means that sales are shared between a listing (sellers) agent and a sales (buyers) agent.  The seller pays the listing agent a commission and that agent pays a portion of the commission (usually 50%) to the buyer’s agent. You can have the best of both worlds because you can be represented exclusively by one agent, have access to every property being offered in your area of interest and you don't have to pay him a dime. 

This is great for a buyer because you have the ability to hire an agent to represent your best interests rather than having to work with a listing (seller’s) agent who is actually being paid by the seller of the property, or you having to bounce around between different agents. A buyer's agent can show you any listings and help you find a suitable property. All you need to do is find an agent you like, and hopefully trust, and then get to work.


Are you looking for US investment property at a discount? Are you looking for a discounted short sale or bank owned property?  John Breaux can be reached at john@marathon-group.cz or +420 602 355 810 or +1 504-208-4331.