Many US visitors want to buy Real Estate properties in Miami and they often do not know how to proceed. Below are some common questions and answers.
1. How can I transfer money from Romania to the USA to buy a property such as a condo or a house?
After finding a property, values and purchase conditions are agreed upon by both parties through a contract. A copy of the contract may be submitted to your bank in your country of origin to allow for a bank money transfer to occur from your account or brokerage firm, to a title company / attorney escrow account in the United States.
In a real estate transaction in Florida, funds are deposited directly into the escrow account of the title company where it is stored until the signing of the final documents, and the buyer becomes the owner.
2. How long will the money take to come from my country to the United States?
The money is usually transferred within one (1) to five (5) business days, depending on your country’s banking laws.
3. What exchange rate will I receive when I make a bank transfer?
The exchange is the current market exchange rate plus the fees that your bank will charge you in your country for the transfer.
4. Will I have to pay income tax on the amount I send to purchase the property in the USA?
If you have already paid income tax on these funds in your country, you will not be taxed again in the USA. The only taxes you will pay will be the annual property taxes on the property, and the Capital gains taxes to the IRS on your profit when you sell the property.
5. Is it safe to buy a property in Miami?
If you use the services of brokers and companies licensed in Florida, the process is safe.
6. How long does it take to receive the deed?
If the property is already done and the owner and buyer sign contract offer, it usually takes 30 days. If both parties agree and the resources are available, we can do it faster.
7. How do I pay the bills for the property?
You will be required to present some if not all the following information: Passport, valid visa, proof of minimum income and deposit. You can go to a bank, open a bank account, and pay your bills through direct debit over the internet.
9. Do we need to give a deposit to hold the property until the contract closes?
Yes, you will send the deposit to the escrow agent that will handle the closing.
10. How do I maintain the property while overseas?
We can put you in touch with reliable companies that, in addition to taking care of your property, they also provide professional assistance for repairs, renovations, and cleaning.
11. Do I have to pay income tax in the United States on the money used to buy the property?
No, the only income tax you will pay will be on the rental income for the property. The amount of the tax is applied to you net profits you make after all your expenses for the property are paid.
12. What are the first steps to buying real estate in the United States?
Here is some useful information for those who want to buy property in Florida.
First step: Property search
At this stage, we will help you find Real Estate options depending on your profile.
In the USA real estate brokerage is quite different then overseas.
In the USA there is one property registration system, called MLS (Multiple Listing Service) where all Miami Real Estate brokers have access to all available properties on the market. We will customize such a search for each client.
When choosing a broker, choose a trusted person. The broker is here to help you with the buying process from the real estate search to the delivery of the keys.
In this first stage, we need your to provide as much information on the type of property you are looking for and your price range so we can find the property that suits you and fits your budget.
Types of properties:
- Apartments or apartment
- Townhouses (house)
- Industrial Spaces
- Pre Construction
The second step: Payment
Payment in cash:
- Copy of passport and visa
- Copy of bank statement or other proof of funds required for the purchase of property. The bank statements may come from your country of origin.
- The entire purchasing process can be done in person or via the Internet.
- Most overseas banks may transfer amounts payable upon the execution of the purchase contract for the property.
Mortgages for US visitors:
Most American banks that finance visitors require minimal 25% to 40% down payment to finance the property.
- Copy of passport and visa
- Letter of pre-approval from Bank ** proving availability necessary to purchase property that will be sent to the seller, along with providing value.
- Letter of pre-approval of the Bank: is a document provided by the Lender Bank stating that funding was approved specific value. It is therefore extremely important that the required documents are submitted for assessment in advance.
Below is the link with the required documentation for this purpose:
- Copy of last two income tax statements
- Bank account in USA
- Copy of bank statements (Overseas, USA, or a combination of both) for last 3 months proving funds availability (the Bank may request information from you to show 25% to 40% of the property value)
- Letter from the employer stating income over the past two years
- Two letters of reference credit
In this case, the whole process takes at least 45 days. The buyer will be required to be present in Miami or a US embassy overseas to sign documents.
There are several financing options, but the most common in the United States are 15 or 30-year loans, with interest rates ranging from 4% to 6% per year (rate may change depending on the market value of funding). The mortgage may be paid off early without any pre-payment penalty or fee.
Third Step: Offer to purchase the property
After finding the property of your choice then we deliver an offer to the owner.
At this point is where we try to get some discounts on the purchase of property, but it is not always possible. In some of the most sought after locations, some properties are sold over the asking price if there are multiple offers received.
If the offer is accepted by the owner and a deposit is required (this will typically be between 5% and 10% of property value). This is made too show that the buyer has good income and that he/she is really willing to buy the property.
After both the buyer and seller sign the contract, the key handover may occur between 15-60 days, depending on negotiations.
NOTE: In 95% of the cases for pre-construction projects there is no price negotiation; the buyers will pay the developer’s asking price.
Forth Step: Property Inspections
The last step before finalizing the purchase and can be done by a specialized firm committed to the purchaser. In case the contractor, the same will be the general inspection of the property, which means to check for leaks, operation of air conditioning, pipes, roof leaks, among others. Buyer will receive a detailed report of all that has been seen and recommendations.
The amount charged for the inspection varies depending on the time spent and the size of the property.
This step is not required to purchase the property under consideration, but you may not need to launch properties contractor insurance ha.
In the case the property is financed, bank evaluation and inspection are required.
Final Step: Closing (Completion of Purchase)
Your money should arrive two days before the date fixed for completion and acquisition (closing date) to the escrow account. Then the title will be completed along with all the necessary documents to be signed in the presence of an attorney.
Buyer will receive a copy of all the documents to prove ownership on the same day and the originals will be received after being registered with the county within 45 days.
Closing Cost on average, are between 3% and 5%.
It is also recommended to start a business LLC to acquire the property to minimize inheritance tax on death of the owner and FIRPT tax. The process is fast and the company can be opened typically in less than 1 week.
Want to buy property in Miami but have additional questions? Please contact us so we can assist you with purchasing properties in the city where everyone wants to live!