Congratulations! Whether you are purchasing a home, selling a home, or both in Central Florida, you have turned to the right place for assistance.
The purchase of a home is one of the biggest financial investments of your lifetime. Likewise, when selling your home, you are focused on getting the best possible price for your property within a set time frame.
Whichever road you are about to embark on, you probably have numerous questions or concerns about how to proceed.
Here are some of the most important considerations when buying a new home. Click each tab to get additional information.
Why Use A REALTOR®?
All real estate licensees are not the same. Only real estate licensees who are members of the NATIONAL ASSOCIATION OF REALTORS® are properly called REALTORS®. Our team proudly displays the REALTOR® logo and are committed to treat all parties to a transaction honestly. REALTORS® subscribe to a strict Code of Ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate.
Here Are Several Reasons On The Value Of A REALTOR®:
1. Your REALTOR® can help you determine your buying power.
Once you provide some basic information about your available savings, income and current debt, we can refer you to lenders best qualified to help you.
2. Your REALTOR® has many resources available to assist you in your home search.
Such as knowledge of properties that are new to the market, or those that are about to be listed, and access to property information via the Multiple Listing Service. This database enables us to serach for existing and NEW construction homes in the area you are searching.
3. Your REALTOR® can assist you in the selection process by providing objective information about each property.
We have access to a variety of resources and can provide local community information on utilities, zoning, schools, etc. Once a property is selected, we can assist in preparing a comparative marketing analysis which helps you to research homes and pricing in the area.
4. Your REALTOR® can help you negotiate.
There are countless factors that can be negotiated when purchasing a property, including but not limited to price, financing, terms, date of possession and often the inclusion or exclusion of repairs, appliances and/or furnishings. The purchase agreement should provide a period of time for you (typically 30-60 days) to complete appropriate inspections and investigations of the property. We can advise you as to which investigations and inspections are recommended or required.
5. Your REALTOR® provides due diligence during the evaluation of the property
Depending on the area and property, this could include inspections for termites, dry rot, asbestos, faulty structure, mold, roof condition, septic tank and well tests (if applicable), just to name a few. We can assist you in finding qualified professionals to perform the investigations and provide you with written reports.
6. Your REALTOR® can assist you with understanding different financing options and in identifying qualified lenders.
7. Your REALTOR® can guide you through the closing process.
Who Is Responsible For Paying The Commission In A Real Estate Transaction?
Traditionally the REALTOR’s® fee to the listing and selling agent, comes in the form of a commission that is paid by the Seller at closing or the builder if you purchase a home from a builder (AKA New Construction). If you have any questions about whether you will be responsible for paying a commission, you should always ask your REALTOR®.
When Purchasing An Existing, New, Or Custom home, You Will Want To Build A Plan Of Action
Buying a home will probably rank as one of the biggest personal investments. Being organized will contribute significantly to getting the best deal possible with the least amount of stress. It’s important to anticipate the steps required to successfully achieve your housing goal and to build a plan of action that gets you there.
Before you can build a plan of action, take the time to lay the groundwork for your decision-making process.
Evaluate your finances
You will want to ask yourself: How much can I afford to pay for a home? It is best to complete the preapproval process UP FRONT before looking for a home.
Check your credit
Lenders will check your credit report to determine how much of a risk they are taking by loaning you the money to purchase your home. If you have not checked your credit report, it is important that you do. Even if you have had no credit problems in the past – it is best to check there are no errors. Under the Fair and Accurate Credit Transactions Act (FACT Act) consumers can request and obtain a free credit report once every 12 months from each of the three nationwide consumer credit reporting companies. AnnualCreditReport.com processes requests for free credit file disclosures (commonly called credit reports) through the three credit bureaus: Transunion, Experian and Expedia.
Determine your needs
Ask yourself where you want to live and what is the best location for you and/or your family. Things to consider:
- Convenience for all family members
- Proximity to work, school
- Local transportation
- Type of home: condominium, townhome, or single family home
- New home construction, custom home, or re-sale
- Square footage
Know the neighborhood
There are many factors to consider when selecting a neighborhood that is right for you. Think about the location in terms of commute time to work, distance from leisure-time activities, and proximity to shopping, schools or any other places you frequent. You may think of others factors that are important to you.
Scout out the Neighborhood
- Talk to people who live there.
- Drive through the entire area at different times of the day, during the week, and on weekends.
- Look carefully at how well other homes in the area are being maintained—are they painted; are the yards well cared for
Neighborhood Factors to Consider
- Look for things such as access to major thoroughfares, highways, and shopping.
- Listen for noise created by commerce, roads, railways, public areas, schools, etc.
- Check with local civic, police, fire, and school officials to find information about the area.
- Research environmental topics such as soil and water quality, sink holes, as well as floodplain implications.
- Study traffic patterns around the area at different times of the day and measure drive time from the area to work.
- Is the neighborhood near parks, places of religious worship, recreation centers, shopping, theaters, restaurants, public transportation, schools, etc.?
- Does the neighborhood have a Homeowner’s Association?
Get Pre-Approved When Buying a Home
Preapproval is recommended prior to starting your home search, and will assist you in searching for homes in your price range.
What is the difference of getting Pre-Qualified vs. Pre-Approved?
When you are pre-qualified, a lender will give you an estimate on how much you can afford to borrow. The estimate is based on general questions about your income, debt, assets, and credit history.
However, being pre-qualified and pre-approved are different and if you are pre-qualified it does not necessarily mean you are approved.
Pre-approved means you have filled out the mortgage application, the lender has assessed your qualifications, reviewed your credit report, verified your employment, assets, income, expenses, etc.
This will give you a number of advantages:
- When you do find a property, sellers will take your offer more seriously because you have a lender that is committed to backing your offer.
- It gives you the assurance that you’re looking at homes you can confidently afford to finance. Your efforts will be focused on properties that match your purchasing ability.
- You’ll have a significant edge over the other buyers who aren’t pre-approved. In situations where there are multiple offers on a property, this can be the difference between having your offer accepted or losing the property to another buyer.
Lenders may include: credit unions, banks, mortgage brokers, or online lenders.
Our team can provide contact information for various lenders and institutions to assist you with your pre-approval.
Preparing and Making an Offer
Once you have found the home or property you wish to purchase, our team will help you prepare an offer. Offers are made on standard forms that have been approved by The Florida Bar and the Florida Association of REALTORs®.
Some terms of the Contract that are negotiable include the Closing Date, who pays for the Title Insurance, Repair Costs, etc. Here are some more examples of negotiable items that you will see on the Contract for Sale and Purchase:
- The Amount of the Offer. We will work together to prepare a Comparative Market Analysis (CMA) to determine the right price based on the most recent sales in the community.
- Good Faith Deposit. This is the amount that you will deposit into an escrow account to be held until the closing. It is customary for the Seller’s broker or the Title Company handling the closing to hold this in their escrow account, but it is also acceptable for the Buyer’s Broker to hold the escrow. Please keep in mind that there are strict guidelines and laws, which govern real estate transactions and escrow accounts.
- Financing. The financing clause states specific terms that need to be fulfilled and assigns a time for these to be completed. If the Buyer cannot secure a loan under the terms agreed upon in the Contract, the Buyer may be entitled to the return of the escrowed funds without penalty. However, if the timelines are not adhered to then the buyer may forfeit deposit. We provide a timeline/checklist to ensure
- Closing Date. This is somewhat negotiable and usually at least 30-60 from the effective date of the contract. The effective date of a contract is the date that the last party signed the contract.
- Time for Acceptance of Offer and Counteroffers. This is typically anywhere between 24-48 hours after the offer has been delivered in writing, by email, in person, or by fax.
- Repair Costs. Maximum repair costs are also negotiable. The contract has a default for General Repairs and Repairs due to Wood Destroying Organisms. The default on a standard contract at this time is 1.5% of the agreed upon contract sale price, unless otherwise agreed to during the contract negotiations.
- Items that are included with the sale or excluded from the sale. This is also negotiable and usually concerns items such as window treatments, light fixtures, appliances not already covered under the contract, pool equipment, and in some cases, furnishings. Remember, you are selling your home, it’s not a garage sale, don’t lose the contract for sale of the home over negotiations for a dinette fixture that could easily be replaced for $100.
- Inspection Period. The inspection must be performed within the agreed upon time period. If the inspection is not performed within this time period, the Buyer, in most cases, loses the right to make demands for repairs.
- Appraisal. If the Buyer is seeking a loan from a Lending Institution, the Lender, in almost all cases, will require that an appraisal be performed and that the property appraise for the agreed upon contract price. Otherwise, the Lender may not make the loan. You can include an addendum to the contract that states that they have the right to cancel the contract if the property does not appraise for the sales price or at or above an agreed upon price. This would be one of the few situations where an appraisal could be considered a negotiable term of the contract.
- Title Insurance. Who pays for the title insurance, is a negotiable item. However, it is customary whoever pays for the Title Insurance selects the title and closing agent, and the location of the closing.
- Other Contingencies. There are many other contingencies that can be written into a contract, usually through addendums. An example of a typical contingency is that the contract is contingent upon the Buyer’s successful closing of another property, usually their previous home. This and most other addendums are negotiable.
General Home Inspection
You have found the house, your offer has been accepted – now you need to hire a professional home inspector. This inspection is an opportunity to have an expert look closely at the property you are purchasing and get a written opinion as to its condition.
As with most professions, a professional organization for home inspectors exists. The ASHI (American Society of Home Inspection) www.ashi.org requires members to pass written exams, have a specific amount of job experience and follow a code of ethics. We can provide client recommendations for finding a qualified inspector.
A home inspection typically examines heating and central air conditioning, plumbing, electrical systems, roof, floors and appliances (to name a few). Once the inspector examines the house they will write up a report of findings which will provide you with a good idea on the current condition of the home. Once the inspection is complete, review the inspection report carefully.
Wood Destroying Organism (WDO) Inspection (AKA Termite Report)
A WDO Inspection Report is a written report of an inspection on a structure for visible and accessible evidence of an infestation or damage by wood destroying organisms. Usually this means subterranean or dry wood termites, but will also cover wood destroying beetles and wood destroying fungi. A WDO report is also commonly called a “Termite Inspection.”
A WDO inspection report is provided when a home or other structure is being sold and the mortgage lender or buyer requires the inspection as part of the transaction.
The WDO inspection can only be done by a wood-destroying organisms identification cardholder (or a certified operator with the wood-destroying organisms category) of a pest control company licensed by the state of Florida. These employees must receive special training to be qualified as WDO inspectors.
TYPES OF NEW CONSTRUCTION
Many home seekers like the idea of moving into a brand new home. New home construction, can involve numerous choices for the buyer, such as floor plans, elevations, cosmetic options and upgrades. When looking for a new home, there are two basic categories:
Generally located in communities established by developers, and can consist of a single family home, townhome, or a condo. Buyers have the option of choosing one of many designs and floor plans that are standard for the community. Most production builders provide on-site models, which display the various floor plans and exterior elevations. Buying a new home does not necessarily mean you have to wait several months for construction. Often time’s builders have existing homes for sale that can be occupied immediately – which is great if you need something right away!
Are generally more expensive and take longer to construct, because each home is built to the exact specification, design and taste of the buyer. When building a custom home, you interact directly with the builder, architect, designers and construction specialists to explain what features you want in your new home. This attention to the buyer’s desires is one of the key reasons why many people opt for custom building. In Central Florida there are options for building your own custom home from lots within existing/planned developments to those with acreage with no HOA’s. It will really depend on what you are looking for, and we can assist you with all aspects of building your new home.
The following information on Homestead Exemption is directly from the Florida Department of Revenue.
You must apply for exemptions with your county property appraiser. The property appraiser will require documentation. In addition, there may be exemptions for those with disability, veterans, windows and widowers. Check with your local county appraisers office for further details and questions.
Individual and Family Exemptions, basic homestead exemption information
If you reside your property in Florida on January 1 and make the property your permanent residence, than you MAYBE eligible to receive a homestead exemption up to $50,000. The first $25,000 applies to all property taxes, including school district taxes. The additional exemption up to $25,000, applies to the assessed value between $50,000 and $75,000 and only to non-school taxes. Find your county appraiser contact and website information. Some county sites have quick and easy online applications. If filing for the first time, be prepared to answer some questions which may include:
- Whose name or names were recorded on the title on January 1?
- What is the street address of the property?
- Were you living in the dwelling on January 1?
- Do you claim homestead in another county or state?
The property appraiser may ask for any of the following items to prove your residency:
- Previous residency outside Florida and date ended
- Florida driver license or identification card number
- Evidence of giving up driver license from other state
- Florida vehicle tag number
- Florida voter registration number (if US citizen)
- Current employer
- Bank statement and checking account mailing address
- Proof of payment of utilities at homestead address
If you are moving from a previous Florida homestead to a new homestead in Florida, you may be able to transfer, or “port,” all or part of your homestead assessment difference. Check with the appraiser office to discuss procedure and if you qualify.
This information is subject to change at any time. Please check with your local county appraisal office with questions and to verify your eligibility.