Ten Tips to Finding the Right Mortgage for Your Florida Home
An overarching point to bear in mind is that in many American
companies operating in the service sector tend to only see black
and white not shades of grey, and they like forms, lots of them
- you do need a good mortgage advisor aware of the differences
between American and British mortgages to advise you.
1. Do your research - with lots of conflicting information and
the inevitable hype - our powder washes whiter - this may be
tougher than you think. Be sure that the source is reliable,
double check facts and ask your self if it makes sense.
2. Decide on the type of financing you are looking for: Sterling
or Dollar, interest-only or capital repayment, long-term or
short-term.
3. Start the process early - Get pre-approved for your mortgage
before starting your search for a home, in the current market in
Florida many property sellers will not take an offer seriously
if the potential buyer has not been pre-approved.
4. Should you chose to finance in the USA make sure you obtain a
"Good Faith Estimate". This is a standardized document used to
detail all the costs of obtaining your mortgage. This form will
cover monthly and one-time costs (disbursements) - Remember,
this is an estimate and some unscrupulous mortgage providers can
and indeed have been known to mysteriously omit items that you
may have to pay later. If you compare estimates make sure to
question any big variance in costs immediately.
5. Be aware of time scales - The US home buying system is
heavily reliant on time scales. Make sure you provide any
required documents in a timely manner to avoid running out of
time and possibly being in breach of contract. Breach of
contract can cause you to lose your deposit.
6. Whenever possible try to secure a self-certified mortgage.
Unlike the UK this type of mortgage does not necessarily carry a
higher interest rate than a fully documented mortgage and could
save you a lot of time and frustration assembling documents.
7. Open your US bank account in person at the banks local office
whenever possible. Since the higher security measures have been
implemented post September 11th it can be difficult to open an
account unless you are physically present in Florida. Ask your
estate agent or mortgage provider to recommend a suitable bank
branch.
8. Keep in mind that most "Foreign National" mortgages require a
minimum of 20% down payment with some special programs requiring
30% or even 35% down. Although there are many mortgages offered
with lower down payments the vast majority either are not
available for non American buyers or have some strings attached.
9. Make early enquiries concerning Buildings and Contents
insurance (known in Florida as Hazard or Home Owners insurance)
for your Florida home. During the Hurricane season (June through
November) it can be difficult to put insurance in place if you
have not made early arrangements.
10. Decide early on if you will be in Florida for completion.
(Called "closing" in Florida; typically takes place around a
conference table in a lawyers or title insurance office) This is
when you become the official owner of the property. If you will
not be present you will need to make everyone aware of this so
arrangements can be made for either a "Mail-Away" closing (where
all the legal documents are sent to you in the UK) in which case
you will need to make an appointment with a notary in the UK who
will witness your signatures. Alternatively, you can authorize
your US attorney (or other legal representative) to have your
"Power of Attorney" and act on your behalf signing the legal
documents for you.