Buying Property in South Florida as a Foreign Buyer

Foreign Buyers of Properties in South Florida
Answering your Questions about buying property
in South Florida as a non-U.S. Citizen/Foreign National

 

 

1. Question:  Do you have experience working with Foreign Buyers?  Answer:  Yes, I’ve worked as a Real Estate Agent in South Florida since 2006 and have extensive experience representing Foreign Buyers who have purchased properties in South Florida.  Within the U.S., the State of Florida has the highest number of Foreign Buyers who purchase properties–many of whom purchase properties in Southeast Florida. 
2. Question:  Which languages do you speak?  Answer:  I speak English, however, if you require assistance in a different Language,  I work with other Real Estate professionals and Translators who are available to assist you, who speak Greek, Spanish, French, Italian, Portuguese, Russian, and other languages.  
3. Question:  Are Mortgages/Financing available for Foreign Buyers?  Answer:  Many Foreign Buyers of South Florida properties pay Cash for their purchases instead of obtaining Financing, but yes, Mortgages are available for Foreign Buyers (known as Foreign National Loans) and I can refer you to Banks and Loan Officers who can assist you with the Application and approval process.
4. Question:  What are the documents that are required for a Mortgage Application for a Foreign National Loan?  Answer:  Documents that you may be required to provide can include, but aren’t limited to the following:  Copy of your Passport/Visa, a Letter from your Employer that verifies your Salary for the last couple of Years and Year-to-date for the current Year, a Letter written by an Accountant/CPA that verifies your Income (if you’re self employed), Bank Reference Letter from your Country, Bank Statements from a U.S. Financial Institution showing funds available for Closing Costs, down payment, etc., Utility Bill that verifies your current Residency, etc. Note:  Your Loan Officer will specify exactly which documents are required and all of the requirements that must be met for Financing. 
5. Question:  How much down payment is required for a Mortgage?  Answer: Typically, you can expect to pay a minimum of 35% down, however, this amount can vary and your Loan Officer will provide you with details that are specific to you.
6. Question:  If I’ll be paying Cash for my property purchase, how do I pay my Cash funds for the property purchase?  Answer:  Physical Cash is not accepted for property purchases, nor are Money Orders, Personal Checks, or Cashier’s Checks.  You will be required to have funds wired from your Bank to the Closing Agent’s Bank at the time of Closing/Property purchase. 
7. Question:  How do I verify to a Property Seller that I have Cash available in the amount of the intended Property purchase price?  Answer:  Cash Buyers (Foreign or Domestic) are required to provide Proof of Funds verifying that they have Cash available in the amount of the intended property purchase price. Proof of Funds can be provided in the form of a Letter from a Bank, other Financial Institution, Financial Advisor, Accountant, or Attorney stating that you have funds available in the amount of the property purchase price OR can be provided in the form of Bank Statements showing available funds in the amount of the property purchase price.
8. Question:  I’m not sure if I’ll be able to be in Florida at the time of Closing/Property purchase.  I might be back at Home outside of the U.S. or traveling elsewhere.  Do I have to be physically present at the time of Closing?  Answer:  No, you’re not required to be physically present at the time of Closing.  Closing Documents will be sent to you for your review and signature prior to Closing, you will wire Closing funds, the Property Deed will be sent to you, and Property Keys will be sent to you after Closing.   Note:  Related to this issue is the fact that Condominium and Homeowner’s Associations require an Application and approval process for Property purchasers and some of them require that Buyers be physically present for an Interview after their Application has been approved, so information about the Interview requirement will need to be confirmed at the beginning of the purchase process so that you can schedule your Travel accordingly if you’ll be required to return for a physical Interview. 
9. Question:  Am I required to be present for Inspection of the Property?  Answer:  No, you aren’t required to be present for the Property Inspection.  I can recommend an Inspection Company that you can hire for the Inspection or you can select one of your own choice, you will speak with them to arrange payment for the Inspection, the Inspection will be scheduled, I’ll be present at the Inspection, and a full Inspection Report will be emailed to you for your review within 24 Hours after the Inspection.
10. Question:  Am I required to hire an Attorney to represent me for the Property purchase?  Answer:  In Florida, you are not required to hire an Attorney to represent you for Property purchases, however, you may hire an Attorney to represent you if you prefer and I can refer you to a local Real Estate Attorney.  Title Companies conduct a vast number of Closings in Florida and are available to assist with facilitating the entire Closing process, transfer of funds, all Closing and Settlement documents, Title Insurance, Title and Lien search to verify if the Property’s Title is clear/free of encumbrances, transfer of the Property’s Deed to you, and work with your Lender to process necessary Closing items if you’re planning to finance your property purchase.  I can recommend a Title Company for you to work with.
11. Question:  How do I verify Ownership of the Property that I plan to purchase and confirm that Title to the Property is clear/free of encumbrances (such as Liens, etc.) and able to be transferred to me when the property is purchased?  Answer:  Read the response to question #10 above.
12. Question:  How much are Foreign Buyers required to pay for Property Tax?  Answer:  Property Taxes are billed to individual Property Owners Annually (once per Year) by the County and will be estimated at approximately 2% of the amount of the purchase price for your Property.  Property Tax amounts are not calculated based on the fact that you’re a Foreign Buyer.  They vary based on whether the Property is your Primary/Homestead Residence or not.  If you are a legal Florida Resident AND the Property will be your Primary/Homestead Residence, you’ll be eligible to receive Property Tax discounts (see more info about Homestead Exemptions here). 
13. Question:  How much should I expect to pay for Closing costs when I purchase property?  Answer:  Closing costs will vary, depending on the property’s purchase price, Financed vs. Cash purchase, and other factors.    A Buyer’s Closing costs for purchases can include, but aren’t limited to Mortgage Closing Costs if the purchase is financed, Title Insurance, and Closing and processing fees charged by the Title Company.  With Cash purchases, the majority of Closing costs payable to the Title Company by Buyers will be the cost for Title Insurance, not the cost for actual services rendered.  For example, for a Cash purchase of an $800,000 Property, one Title Company provided an estimate of $4,847.83 for the Buyer’s Closing costs–$4,075.00 of which represented payment for Title Insurance.  Note:  State of Florida Documentary Stamp Taxes are required to be paid when a property is sold, but those are payable by the Seller of the Property, not the Buyer.
14. Question:  What is the purpose of Title Insurance?  Answer:  Title Insurance helps to provide protection against Title defects that may arise. Your property is a valuable asset and should be protected as such.
15. Question:  Do I have to work with multiple Real Estate Agents to access/show me various properties?  Answer:  No, it is not necessary nor customary for Buyers to work with multiple Real Estate Agents during their property search.  When you choose an Agent to work with, that Agent will be able to assist you with accessing/viewing any properties that you’re interested in.  Question:  But I see different properties listed on different websites, so doesn’t that mean I need to contact different Agents?  Answer:  No, it doesn’t mean that you need to contact different Agents.  It simply means that Agents have configured property search parameters to appear in various ways on their websites, which produces different search results.  One Agent will be able to show you any properties that you’re interested in.  All Real Estate Agents are required to be licensed through the State of Florida to sell Real Estate and have equal access to properties that Sellers have listed on the open Market for sale.
16. Question:  Are Buyers responsible for paying Real Estate Broker’s Commissions?  Answer:  No. Property Sellers are responsible for paying Real Estate Broker’s Commissions and they are paid when the property sale closes.  If a property isn’t purchased, the Real Estate Brokers aren’t paid.  Property Sellers agree to the specific amount that will be paid for Broker’s Commissions at the time that they sign a Listing Agreement to place the property on the Market for sale.
17. Question:  If I decide to place an Offer on a Property after I’ve returned Home, how does the process work? Answer:  You will contact your Real Estate Agent to let them know that you would like to place an Offer on the property.  Your Real Estate Agent will prepare the Offer documents that will indicate the amount that you’re offering for the property, the amount that you plan to Deposit to secure the property, your desired Closing date, and other details, and will then email it you for your e-signature.  You will complete e-signature of the documents online through a service such as Docusign.  After your Agent receives the signed Offer documents from you, the Agent will send them to the Seller’s Agent, along with a copy of your Proof of Funds documents or Mortgage Pre-approval Letter.  The Seller’s Agent will send them to the Seller to review.   The Seller will then send a response to their Agent as to whether they will accept, reject, or Counter your Offer.  If agreeable purchase terms are met (purchase price, Closing date, and other purchase terms) and all Parties sign the Offer, we will then proceed with the rest of the purchase process–which can include, but isn’t limited to placing a Deposit to secure the purchase, Property Inspection, Property Appraisal, Property Surveys, Condo or Homeowner’s Association approval, Mortgage processing, Title and Lien search, etc.
18. Question:  What is the amount of the Deposit that I’ll pay to secure the purchase when I receive an accepted Offer and to whom is the Deposit paid? Answer:  Sellers will request that Buyers pay various Deposit amounts, however, you can estimate an average Deposit amount that represents 10% of the property’s purchase price.  You will send the Deposit to the Escrow Bank Account of the Real Estate Brokerage where your Agent is employed or to the Title Company that will be handling the purchase.  The Property Seller will be provided with a Letter that verifies receipt of your Deposit.  At the time of Closing, the Deposit that you paid will be applied toward your Purchase/Closing costs.
19. Question:  What’s required if I’m planning to purchase a Condo?  Answer:  Click here to review a Condo Checklist for Buyers.
20. Question:  Do you offer Property Management services for interested Property Owners?  Answer:  I don’t personally offer Property Management services, but can refer you to Property Management Companies who can assist you. 
21. Question:  How do I obtain Insurance for my Property?  Answer:  Click here to review information about Condo Insurance.  If purchasing a Single Family Home, the process of obtaining Insurance will include requesting Insurance Quotes and obtaining a Flood Elevation Certificate and Windstorm Mitigation Report. Various factors affect a Property’s Insurance rate.
22. Question:  How long does it take to purchase a Property?  What is the typical Closing time frame?  After reaching an accepted Offer/signed Contract to purchase a property, the average Closing time frame is 30 – 45 days, except in cases when a long Closing is requested or if a Buyer is purchasing a Property that’s under construction–awaiting completion of construction and receipt of its’ Certificate of occupancy. 

Feel free to contact me if you have additional questions.