There are only a few laws in Florida that regulates the purchasing of a home aside from the rules that are implemented by service providers — minimum legal age and other requirements for a valid contract. More often than not, when the offer of the buyer is accepted by the seller along with the necessary documentation, the buyer only needs to provide a photo ID, sign the contract with the buyer and the homeowners insurance fla, and pay for the property through wire transfer, money order, or in a form of cash. Those are only the responsibilities of the buyer when purchasing a home in Florida.
Real Estate Contract
A real estate contract in Florida is composed of four elements which include competent parties that means the signer is of legal age (at least 18 years old) and mentally capable; lawful object to ensure that there is no fraud, threats or misrepresentation while signing the contract; consideration; and the mutual agreement between the buyer and the seller. In order for the contract to be binding, it should be written and signed by all the parties involved.
Most of the states actually require real estate brokers and buyers to be represented by a lawyer; however in Florida, this is not the case. Florida real estate agents, as well as some of the best home insurance in fl, are expected to be competent enough to explain the contract; but, they are prohibited by law to give legal opinions. Real estate agents in Florida only have a transaction broker relationship with their clients; this permits the agent to represent both buyer and seller in one transaction.
The closing of a property in Florida usually happens in the property’s location. However, the seller and the buyer need not be present as the documents may be faxed or emailed to them for signing. More often than not, the buyer is responsible for the payment of the documentary tax on mortgage and the intangible tax as well. In most areas of Florida, the seller would pay for the Fl homeowners insurance average; in Dade and Broward counties, on the other hand, the buyer will be the one to shoulder the insurance.
Since there are a lot of foreclosures in Florida, Fla homeowners insurance by county isn’t always available in many areas. Thus, the borrowers would have to pay at least 20-25% down payment outright for single family homes; meanwhile, a 25-30% down payment for condominium properties. However, there are federal loans and grants available for those who need financing.
Federal Grants and Loans for Mortgage in Florida
The federal government of Florida actually offers to help their residents buy or improve their first home. These programs are implemented by the Department of Housing and Urban Development (HUD) and are available in various state and municipal housing agencies. They offer funding to pay for down payments, as well as closing costs. However, eligibility for the programs would be determined according to your income, your location, as well as your profession.
Agencies that Aid First-Time Mortgage Buyers
The local housing agency in your area can provide you with information about the federal grants and loans available near you. In order for you to find the nearest agency in your area, you may go through the HUD’s list of qualified participants. HUD’s website will be able to provide with the links of resources that will help you with your query.
Grants that Cover Costs
It is important to note that grants aim to help first-time buyers who haven’t had a home of their own in the last 3 years. Grants actually don’t have to be repaid, they are given to help pay for the portion of the down payment or the closing costs, or both, depending on which program you have applied to. The amount and the duration of obtaining a grant actually depend according to the funds that are allocated for your area and jurisdiction, as well as the demand for the program.
The federal government offers financial assistance for the down payment and closing fees. It is important to note; however, that the housing agency that facilitates the down payment or other first-time buyer loans should be approved by the HUD.
Also note that you are required to repay the secondary financing given by the HUD; however it may not require you to pay monthly installments. If the loan isn’t paid through monthly installments, you need to pay off the balance when you sell, pay off the home in full, refinance, or stop using the property.
Good Neighbor Next Door Program
The Good Neighbor Next Door program (GNND) caters to teachers, firefighters, law enforcement officers, and emergency technicians. Although they don’t have to be first-time home buyers, they shouldn’t own a home during the time when they decide to purchase a GNND property.
The HUD provides a 50% discount on homes that were foreclosed; but you should agree to pay for the second mortgage for the home’s discounted value. There is also the silent second loan that requires no monthly installments, as well as interests; they don’t have to be repaid if you reside in the property for 3 years.
Requirements on Education and Income
First-time buyers that are federally-based would require you to complete a homebuyer education course. It is a financial class that would teach you to qualify for your first mortgage, as well as the buying process and the homeownership costs.
More often than not, the housing agency that you use to obtain the grant or a secondary financing program would most likely offer a homebuyer education class. Aside from that, the local housing agency will also be able to provide the limitations in terms of income. Note that these limits would differ according to the area’s median income levels, as well as the size of the household. You also must be low- or moderate-income earner for you to be eligible for HUD’s homebuyer assistance programs.