Florida Home Buyers and Sellers - Consider your timeline when contracting to purchase/sell

I recently had buyers close on a house where the closing date became an issue for the sellers.  The seller's pending move was based upon the occupant of their next home vacating on date "X."  But this was all based on moving into a new construction home that was supposed to be finished on date "Y."

As the closing date approached the sellers found out X ≠ Y.

Completion dates for newly constructed homes are not fixed in stone. Closing dates on re-sales are somewhat more predictable.

Fortunately, the buyer and seller came to an agreement on a closing date adjustment.

The Florida real estate contract contains the sentence "Time is of the essence."   Perhaps "essence" would be more effective if it was replaced with "critical."

Dates will become much more critical beginning in August 2015 when the Closing Disclosure will combine the current HUD-1 settlement and truth in lending statements.  Currently, last minute changes/delivery of the HUD-1 Settlement Statement doesn't usually completely delay the process for days.

This new Closing Disclosure must be provided to the buyer/borrower at least three business days before closing.  If changes occur this could be cause for another three day waiting period.  The key here is to make sure everyone in the process understands the time requirements for the transaction.

I heard it said today that parties should avoid domino closings such as mentioned above as well as situations where the moving van motor is running - at least until the new system is learned. 

If a mortgage is involved I would definitely recommend looking at 45 days from contract acceptance to a closing, for now.

The real estate purchase/sale process is stressful enough.  Being aware of the time requirements in the contract as well as the process will make for a smoother closing.  If you are new to the home buying process, just give me a call if I can help (321-693-3850).

Buying a home: Where Do I start?

About the Florida real estate contract. 

   

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Home Buyer Tips: What are closing costs?

Closing costs are the charges associated with obtaining a mortgage and transferring ownership of real estate.  These are above the purchase price of the property.

In general closing costs include items mostly related to the buyer's loan.  While not all lenders charge these fees these charges are not standardized so expect them to vary.

Some of these charges may include loan application fee, loan origination points, underwriting, tax service, processing and others.  Your lender should provide a good faith estimate of closing costs within three days of loan application which will provide general information about terms of the loan applied for and estimated borrower costs.

In addition to the above lender charges some other closing costs may include the appraisal, settlement costs (or attorney fees), credit reports, inspections and surveys.

Some of these charges (for example inspections or a survey) may be paid in advance at the time of service and will be reflected on closing documents as POC (paid outside of closing).

Another potential closing cost is the escrow requirements for insurance and taxes.  In addition to paying the premium for a year in advance there will likely be additional funds charged at closing to be placed in escrow for payment of insurance renewal and taxes when due.  In Florida, real estate taxes are paid at the end of the year instead of in advance so most mortgage companies collect 1/12th each month so that can pay when due (more information on Brevard County, Florida real estate taxes).

A couple of other key points:

• In most places cash buyers will have minimal charges.  
• What can be charged to buyers will vary by loan type (i.e. VA borrower).
• Buyers can try to negotiate with seller to pay some of the closing costs.
• Some charges like the owner's Title Insurance policy is typically paid by the seller in Brevard County, Florida.
• Average fl closing costs

When it comes to closing costs remember, its real estate...almost everything is negotiable.