Notes on the Sales Contract

Unlike the UK, where the sales contracts are exchanged a week or so before completion of the sale, contracts in Florida are exchanged on day one.

These notes provide an overview of how the process works.

First of all, once we have found you the property you want, we make an offer by completing a standard Florida sales contract. This is completed by us, on your behalf, signed by you and faxed to the seller’s agent. We will guide you as to whether to offer the full asking price, make an offer under the asking price or perhaps even offer over the asking price, depending on the individual circumstances, location and market conditions prevailing at that time.

There may be a number of addendums to the contract, for example, membership of the Homeowner’s Association, depending on individual circumstances, and most contracts run to around 10 pages. It is likely that it will take 24-48 hours or more to get a response from the seller.

If the property is unfurnished, this may be your opportunity to visit a furniture packager. A package will typically cost from about $9,000-$22,000 and includes all furniture, electrical goods, linen, cutlery, dishes, etc., etc. This will normally take about 4-6 weeks to put together and will be delivered and fitted immediately after you take possession.

Once we receive a reply to your offer, we will contact you. The seller may counter-offer, decline or simply (and hopefully) accept your offer. If the offer is accepted, we will receive a copy of the contract signed by the seller. We will provide a copy of this for you.

THE CONTRACT IS AT THIS TIME LEGALLY BINDING

At this time you will be required to pay a good faith deposit ( normally $1,000 but could be up to $5,000 ) immediately – this is why it is essential to have sufficient funds in your US bank account. The deposit will be held by an independent title company. Normally the listing agent nominates the title company. Until the deposit is paid, there is always a possibility that a better offer may be received.

Home Inspection

The next step is to book a property inspection, which you should attend, as we normally can arrange this within 2/3 days of acceptance. You will need to pay for this by cheque – typically $300.00-$400.00. We can supply a list of approved home inspection companies, as strictly speaking, it is your responsibility to do this, or we can select one for you and make the appointment. The seller will have agreed a maximum repair cost figure, for which he/she will accept responsibility. This is normally subject to a maximum of, typically $500.00 or $1,000.00. The home inspection report will identify any such repairs. A copy of the report will come to you, plus one to us and to the seller, via his/her agent. We also recommend that you book a re-inspection ( around $125.00 ) after the seller has completed any repairs identified, to ensure that they have been correctly completed. We are not repairers or engineers and cannot be expected to complete any re-inspection.

Mortgage Application

If you have applied for a US Mortgage, you will need to make a return visit to the Mortgage Broker to apply the property details from the sales contract to the application you have already partially completed. The Broker will require $500.00 to cover the cost of an appraisal and an international credit check at this time.

Your mortgage broker can help you to arrange property and liability insurance. A typical policy providing building and contents cover, plus liability cover of $300,000 will cost you from $800-$1,200 per annum. The first premium is normally included in the closing costs. You will not be able to obtain a mortgage without this cover in place.

You will realise at this time that you need to have your finances well organized. Within the next few days, you will need to pay a further deposit – typically $4,000, if you initially only paid $1,000, and you may have to pay a deposit on a furniture package, so you must have planned to transfer more funds into your US bank account.

Please note that if you change your mind at this stage, you are almost certain to lose the deposit, appraisal fee and inspection fee. Once the contract is agreed, it is lgally binding and once the Home Inspector and Appraiser have done their work, the will need to be paid.

The final meetings you are likely to have before you return to the UK are with prospective property management companies. Please see pages on  property management on this site for details.