When buying a new home or condo here in Florida, a lot of people begin by searching in places like Zillow.com and Realtor.com. Those sites can really be helpful because they allow visitors to narrow their search based upon criteria like the type of residence (single family home, condo, townhouse, etc.), location, and proximity to schools and medical facilities.
Then after doing some research online, usually the next step is for a buyer to contact a real estate agent. That step normally results in spending a lot of time reviewing MLS listings and touring potential properties.
While a buyer is looking for a home, he or she is also trying to find a mortgage lender who will be willing to loan them the money to help finance the transaction. (In South Florida, this step is often skipped because of all of the cash deals that are happening with overseas buyers.)
Hopefully, after all of this work, the effort culminates in finding a property, an offer being accepted, and the transaction closing. Getting to the closing table once a contract is signed can be an arduous task (inspections, interviews with condo boards, gathering financial documents, etc.) and it can be overwhelming for a lot of buyers — particularly first time buyers.
But what exactly happens at the closing table? Does the buyer have to attend the closing? Does the non-resident buyer have to come back to Florida to close the transaction? Will the buyer have to sign any paperwork, especially if they are paying cash?
In Florida, Is There More Than One Type Of Closing?
In Florida, there are generally two kinds of closings. First, there is the face-to-face closing, where everyone gathers together at the same time to close the deal. Here, the buyer and the seller sit at a table with their representatives (their real estate agent, their lawyer, etc.), and the closing agent (for instance, the title company’s representative). The closing is the time when the seller receives the sale proceeds and the buyer is given the keys; it’s also the time when documents (like the mortgage, the note, the deed, the bill of sale, etc.) are signed and exchanged between the parties, including the mortgage lender.
However, in some situations, not everyone can be present at the closing table. For instance, an out-of-state condo buyer may be unable to come to South Florida to close on his or her new retirement condo. Here, the closing occurs as a “mail away.” Meaning, all of the documents that would be passed around the closing table at a face-to-face closing are instead sent to the buyer or seller wherever they are located. They sign the documents and mail them back to the closing agent, who then disburses the seller’s proceeds, records the Deed (and mortgage, if any) and then issues a title insurance policy to the buyer (and/or mortgage company).
4 Things That All Florida Buyers Need to Know Before They Close On A New Home
It’s easy for some buyers to become so excited about buying their new home that they disregard or discount the need to protect themselves by doing their due diligence, including reading the fine print and considering the consequences of certain terms and conditions. For others, the entire closing process can be overwhelming or intimidating and they may assume that the real estate professionals will protect them from harm — which can be a dangerous assumption to make!
Anyone buying residential real estate particularly in South Florida, either with cash or through a mortgage, should consider the ramifications of what they are undertaking. Most of these buyers are committing to decades — as much as 30 years — of monthly mortgage payments in order to purchase their new home.
Because buying a home is an important life event, it’s smart to consider what is happening ahead of time and learn as much about the process as possible. Here are four things that we think all Florida residential real estate buyers should do and be aware of:
1. Buyers Should Be Educated
There will be lots of documents at or before the closing, some of the most important include (1) the documents related to the real estate itself (inspection reports, deed, affidavits, title insurance commitment, appraisal, etc.); and (2) the documents related to the mortgage loan (Mortgage, Note, Loan Estimate, Closing Disclosure, etc.). Since we believe home buyers should become familiar with these documents ahead of time, we wrote about the documents and some of the related issues in these posts:
- Details about your mortgage documentation
- 3 Types of Title Issues Which Impact Florida Real Estate Closings
2. Buyers Need to Know About The Closing Process
Every Florida home buyer should understand that several people are involved in a Florida residential transaction, besides the buyer and the seller, there is the real estate agent, the real estate broker, the title company (aka “closing agent”), the title insurance underwriter, the appraiser, the inspector, and the lawyers.
Asking who will be at the closing before you go is always a good idea. It helps buyers know what to expect, which can lessen any stress and anxiety. It also lets the home buyer know who may be able to answer any questions that they may have at the closing table.
Buyers don’t have to go to their closing alone, either. They can bring their own lawyer, as well as a trusted friend or colleague. It’s good to have support on such a big day, and often home buyers will want to celebrate with a nice lunch or dinner with their friends afterward!
3. Buyers Need to Be Comfortable
By preparing for the closing in advance, a buyer can be ready with any questions or concerns they may have when they come to the closing. Sometimes, things are still being finalized up to the last minute, and buyers have a right to have all these things done (and done right) before they close. Was the roof fixed? Did the condo association provide an updated estoppel certificate? Did the seller pay their final utility bill? Is the Seller providing the buyer with all of the keys, clickers and entry cards? There are no bad questions to ask at or before the closing.
4. Take Your Time
If a home buyer is concerned about something about the property or their mortgage, then the closing may need to be delayed until that buyer is satisfied. There is no law that says a closing must take place at a certain time of the day just because it has been scheduled. Closings are often re-set because of a variety of issues (however, be careful not to violate the terms of the contract related to the closing date).
Every buyer has the right to understand fully and completely exactly what each document means as well as having all of their questions answered to their satisfaction.
Buyers, and sellers, should take their time during the closing. Don’t be pressured to get the deal done, especially by a real estate agent who is anxious to get that commission check!
Florida Home Closings
I, as well as others in South Florida, have been involved in countless residential real estate transactions, representing both buyers and sellers. This experience not only helps us to know the fine details in the closing documents, but it also helps us to know the reputations of the professionals involved in a lot of transactions. Are the real estate agents known for being pushy to get a deal done or are they comfortable taking time? Is this lender known to be borrower-friendly? Is the title company reputable?
Hiring an experienced real estate attorney to help you buy your home and close your real estate purchase isn’t as expensive as many think it to be. And having a lawyer to help with your closing can save many home buyers lots of stress, along with time and trouble.
A good piece of advice is to at least speak with an experienced Florida real estate lawyer to learn about your rights. Most real estate lawyers, like Larry Tolchinsky, offer a free initial consultation (over the phone or in person, whichever you prefer) to answer your questions.
To learn more, read our extensive collection of real estate closing articles.
Do you have questions or comments? Then please feel free to send Larry an email or call him now at (954) 458-8655.
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