A Guide to Buying Property in the USA

The legal process for buying real estate in the US is very different to that in Ireland so it is essential to secure the services of a US lawyer. Each US State can have its own laws and taxes and it is advisable to try to secure a lawyer in the State in which the property is located.

Step 1
Once you have found a property you are interested in you will generally be asked to sign a reservation form and to pay a booking deposit. A) You should check if this deposit is refundable or not. B) You should immediately instruct a lawyer to act on your behalf. C) If you are taking out a mortgage you should start this process as quickly as possible.

Step 2
You will be issued with a reservation contract. You should send this to your lawyer immediately to review. In this contract a time frame will be given for you to sign and return. You should make yourself familiar with this. You should also check if a payment is due and for how much this is for. Once you return your signed preliminary contract to the developer/agent you have entered a legally binding contract to pay for your property in full.

Step 3
Signing of final purchase deed. You must have a lawyer for this purpose. Time frame for final signing will be in the reservation contract. When you have signed the final purchase deed, congratulations, you are registered as the new owner of the property in the land registry in the US. Shortly after this you should receive your Title Deeds and keys to the property.

Closing Costs

At the time of signing the final deed of purchase you will have standard closing costs to pay in addition to the purchase price of your property. These will include property transfer taxes, notary fees, registration fees and legal fees (may be paid at a different time). These fees can vary greatly from State to State so specific advice should be sought from your agent with regard to this.

What your lawyer should do

Your lawyer will check your contract for compliance with the laws of the country you are purchasing in.

Your lawyer should:
A) Review of preliminary contract to ensure compliance with laws of relevant USA jurisdiction.
B) Carry out due diligence on the developer of the property to check planning permissions, land registry, building permits licences etc.
C) Undertaking negotiations with developer on any issues which need to be changed or included.
D) Report on the contract as a whole highlighting any clauses included which you might want to negotiate, and any clauses which are missing which should be included to provide you with further comfort.
E) It is of utmost importance for your lawyer to ensure all land registration deeds and title deeds over the property are fully checked, and also that the land on which the property has been built has been designated as allowable for foreign ownership.

Purchase Costs of Buying Property in Florida

If a buyer uses no financing for the purchase, the transfer costs, including government stamp duties, will be about 1% to which you should add 0.75% for the administration fee. The costs of taking out financing would add an additonal 1%, unless the lender requires a "loan originating fee", which is not usually the case with foreign borrowers.

If there is a loan the lender may also ask for prepaid reserves to pay for insurance and taxes. Thus if lending is involved, the total costs of adquiring the property to the buyer will be on the order of 5% of the purchase price. IF no lender is used then the cost will be less than 2%. This stands in contrast with typical costs for acquiring property in Europe. These costs can vary by State and the USA so we advise you to check these with your Lawyer.