When you are starting the process of buying a Home in Miami, there are a lot of unknowns. There are the different types of properties (condominiums, town homes, single-family homes) and many different reasons why sellers sell (family change, relocation, something happy, something sad). Ultimately every single transaction is different.
The good news is we have completed hundreds of successful transactions so we can help best navigate you through the process.
So here are our top seven questions for buying a home in Miami.
1. What do I need to do before I think about purchasing a home?
A: Here are some things you should do before you buy your next home:
- Check with a lender to see how much you qualify for.
- Also, consider the monthly payment with taxes and insurance.
- Insurance. Talk to a few different insurance agents to get a feel for the insurance cost.
- Do you want a home or condo? Financing is different for both. The cost is also very different.
- How far away will you drive for work?
- If you have children you are probably thinking about school.
- If you have pets and want to live in a condominium which buildings allow pets?
- Do you need parking?
- & of course the property criteria.
2. Get your finances in order. Do I need a preapproval letter or proof of cash?
A: In our area, it is customary if you need financing to have a preapproval letter. Many sellers require a preapproval letter with your offer to purchase. So you should have that readily available when it comes time to make an offer. This typically makes your offer stronger. It speeds up the selling process, and the seller knows you can get the money. If you are purchasing with cash, a seller will often ask for proof of funds with the offer.
If you need financing and the property is in a condominium building, that’s an entirely different scenario and is a must to talk to a qualified lender in advance. I talk more about condo financing in this article.
3. What is the cost of preapproval?
A: There is no cost associated with getting a preapproval letter.
4. What is strong preapproval letter?
A: There is a difference between Prequalification & Preapproval.
Prequalification is when you provide basic info. He, in turn, will give you an estimate of what he believes you would qualify for. Remember, though, it does not mean you are qualified.
In our area, a strong Preapproval is when you have actually submitted documents to the lender, in addition to credit verified, etc. In return, the lender has reviewed the documents in detail and has determined that you are eligible for “x” amount of money with “x” amount of down payment.
Clearly, sellers prefer the more detailed approval process because it means the buyer has gone through a more rigorous process of being qualified.
5. When we find a house we like, how do we buy it?
A: There are many steps involved but here is a brief overview of the process.
In Florida, our offers are usually written on a Florida approved purchase and sales contract. We attach the proof of funds or lender to the offer. Additionally, it is customary to put down an earnest money deposit with the offer.
When your written Offer to Purchase is presented to the seller, he has several choices:
- He can accept your offer
- He can reject your offer
- He can make a counteroffer.
- Of course, he can also do nothing.
When an offer is agreed upon, everything is signed and initialed on this contract, and then you have a binding contract for sale of the property. Your earnest money will be deposited. From there the transaction process starts: think inspections, appraisal, loan application, condo applications, etc.
6. How long does it take to close?
A: If you are paying cash, it depends on your contract contingency periods. I would say generally speaking a couple of weeks. If you are getting financing 35 days for a commitment letter from the bank and 45 days in total to close. These are general time periods in our area.
7. Do I have to be present to close?
It depends. If your lender doesn’t require you to close locally, you can close long distance. If you are paying cash, you can close long distance. The only issue is if you need to interview with the condo association in person, you may need to come back to do that piece.
As I was writing this, I thought of much more, but these are the top of the list for most buyers. If you have more questions about buying a home in Miami, feel free to call or text me at 305-793-8965.