Financials

How much home can you afford?

Lenders recommend that you spend no more than 3-5 times your annual income on a new home. You can find many mortgage calculators online, which provide a great starting point. When calculating, don't forget to include extra expenses like attorney fees, home inspection and appraisal costs and money for any home improvements.

Do you need a down-payment?

While it's ideal if you can put a 20% down-payment on your new home, it certainly isn't necessary. There are many ways to put down much less and with certain types of loans you may need as little as 3.5%.

Credit Check

It is important to have a credit check done as this will be a factor in determining your mortgage approval and interest rates. While sometimes a score in the 500's can get you a loan, ideally you want to aim for 620 or above. The higher the score the lower the interest rate.

Pre-qualified & Pre-Approved

Many times these terms can be used interchangebly in different areas. You will want to ask your real estate agent which is more credible in your market and then apply.

Either way, being pre-qualified or pre-approved shows the seller that you're serious and that you most likely have the funds to purchase the home should you choose to place an offer. Pre-approval can also help you budget as you will know exactly what you can afford.

This pre-approval does not guarantee a loan will be offered so you still want to be careful with your spending during this time. Don't make any large purchases, change jobs or apply for new credit cards during this time.

Tour Homes

Home searching tips......

Make a list of all the things you need and want in a new home. Think about how many bedrooms and bathrooms you need.

Do you want a big kitchen or is a fenced-in yard more important to you?

We will start touring homes and weigh all the positive and negative aspects of each one.

Take photos with your phone while visiting each house. Organize the photos at home with the address of the property so you can remember details later.

Focus on the things you can't change like the neighborhood, lot or size of bedrooms.

Focus on the things you can't change like the neighborhood, lot or size of bedrooms.

Test things as you walk through the home. Open and close windows, turn faucets on and flush toilets to make sure everything is in working order.

Make an Offer and Negotiate

Once you've found the home you want, the next step is to make an offer. We will look at comparable properties in the area and decide on a strong first offer. Many owners price a little high expecting to negotiate so we will take that into consideration as well.

Negotiate Offer

Many times after the initial offer is presented the owner will come back with a counter-offer. As a buyer, don't be afraid to bargain for what you want. Whether that be cost, a new roof or the whole house painted. You don't know what they're willing to do unless you ask.

Inspection

It's always a good idea to add a contingency clause into your offer stating that you have a certain amount of time to have the property inspected. This gives you the right to back out of the agreement if you and the seller can't agree on repairs.

Plan to attend the inspection and be prepared to ask any questions you have.

You will receive a report of findings, but it's sometimes easier to see the issue and hear the information directly from the inspector.

After the inspection is complete, decide if there are any pressing issues you want to negotiate with the seller.

Be careful to not be too picky, but also not let major concerns go unaddressed.

Appraisal

Your lender will require an appraisal of the home before finalizing the loan. The home appraiser will take into account the neighborhood, housing market, age and condition of the home, etc.

A property title search will ensure that the sellers are truly the owners of the property and any leins or juedgments are disclosed.

Loan Approval

The loan is only fully complete after the lender approves the loan. You will receive a final approval letter after they review your income, credit report and employment status once more. Home owners insurance is also required before the mortage company will finalize the loan.

TAX INFORMATION WHEN REPRESENTING A BUYER IN FLORIDA

As your trusted real estate advisor, it’s essential to understand the property tax implications of your purchase. Below is an overview of important tax considerations for buyers in Florida:

1. Property Taxes

Florida property taxes are based on assessed value, not the purchase price, though the purchase price may influence future assessments.

Each county uses a millage rate to calculate annual taxes (average: 1.0%–2.0% of assessed value). Property tax rates can vary by county. For example, Miami-Dade County has specific rates and exemptions.

You can view prior taxes on the property via the County Property Appraiser’s Office website.

Note: The tax bill you see from the seller may be significantly lower if they had exemptions like homestead.

2. Homestead Exemption

If the buyer is a Florida resident and the home is their primary residence, they may qualify for a Homestead Exemption:

Up to $50,000 off the assessed value

3% annual assessment cap (Save Our Homes benefit)

Reduces property tax liability

Deadline to apply: March 1st of the year after purchase

[Apply here via the county’s website or in person]

3. Property Tax Portability

Buyers moving from one Florida homestead to another may transfer up to $500,000 of their assessment difference (also called "portability").

Application required at time of homestead filing

4. Tax Proration

At closing, property taxes are prorated between buyer and seller.

You’ll see a credit from the seller for their portion of the year’s taxes.

Actual tax bills are mailed in November; if the closing is earlier in the year, the buyer may owe more/less depending on final assessment.

5. Intangible Tax & Documentary Stamp Taxes

No state income tax in Florida, but there are some closing taxes:

Intangible Tax on new mortgage: $0.002 per $1 of loan amount

Documentary Stamp Tax on Mortgage: $0.35 per $100 borrowed

These are buyer-paid unless negotiated otherwise

6. Future Tax Increases

The year after purchase, property taxes may reset based on your purchase price, especially if the previous owner had exemptions.

Always estimate your future taxes using the county’s property tax estimator tool.

7. FIRPTA (If Seller is a Foreign Person)

If the seller is a foreign person, the buyer may be responsible for withholding 15% of the sales price for IRS compliance under FIRPTA.

Ensure your closing agent addresses this during escrow.

Helpful Links:

Florida Department of Revenue: https://floridarevenue.com

Miami-Dade Property Appraiser: https://www.miamidade.gov/pa/

Homestead Exemption Application: Click Here

Closing & Moving

Schedule your move

You will want to get movers scheduled as soon as possible. Make sure to avoid scheduling the move and closing on the same day if possible. If you will be doing renovations, start getting quotes from contractors.

Make sure you set up the transfer of utilities for closing day.

Closing

Closing is the final step for you to become the legal owner of your home. You will take a final walk-through just before closing to assure that negotiated work has been completed and everything is in working order.

The closing process itself requires a lot of paperwork and patience. Be prepared with your government issued photo ID, cashier's check and any other documents required by the title company or loan officer.

Don't forget to re-key all the locks and change the garage door opener code when the property is officially yours.

Congratulations on your new home!