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Closing Costs…Who Pays What?

Posted on by Jenny Zamora


The typical seller believes that once they pay off their loan and pay their Orlando Realtor whatever commission was agreed upon then they get the rest of what’s leftover. Very few homeowners give much thought to closing costs. When we say closing costs, we are referring to all the taxes, fees, and costs that are necessary to close a real estate transaction.

In the state of Florida, closing costs are usually split 50/50 between buyer and seller. However, like my 1st real estate teacher told me “everything in real estate is negotiable”, so nothing is set in stone when it comes to a real estate transaction. Hopefully, you’ve hired an experienced Orlando Realtor who is also a tough negotiator.

Your agent should be able to tell in advance what you should expect to pay on the day of the closing. Once you have all the pertinent information, you will easily be able to calculate what your net proceeds will be.

Like I said before, it’s typical in the state of Florida for both buyer and seller to pay equal shares of the closing costs. Sometimes the market can dictate who pays for what depending on if it’s a buyers or seller’s market. For example… If it’s a seller’s market, the seller may require the buyer to pay a larger portion than usual.  By the same token, if it’s a buyer’s market, the buyer may require the seller to pay the lion’s share of the closing costs… or even all the closing costs.

From our experience as realtors in Orlando, it’s very common for buyers to include all of their closing costs in their offer so that they don’t have to come out of pocket at the closing.

These are some typical closing costs on an FL real estate transaction:

  • Escrow Fees: In Florida, it’s not required for a lawyer to handle the closing of a RE transaction. Title companies [sometimes owned by attorneys] are usually the ones who handle closings as well as any escrows. These fees are typically shared equally by both parties.
  • Title Insurance: There are 2 types of title insurance that must be purchased, the owners’ policy and the lenders’ policy. The seller is typically responsible to pay the owners’ policy and the buyer is responsible for the lenders’ policy. Both these policies are in place to protect the lender as well the lender as well as the new owner by making sure there are no liens or other encumbrances attached to the property aka “clearing title”.
  • Transfer Taxes & Documentary Stamps: These are fees that are paid to the city, state and county in which the property is located in. This is where Uncle Sam gets his cut of the deal and is also referred to as a reconveyance tax.
  • Recording Fees: This is a fee paid to the county for recording the deed to the property making it official.
  • Mortgage Tax: This is a tax collected by the state of Florida.
  • Settlement Fees: Also usually shared by buyer and seller. This is the cost that the title company charges to handle any of the financial transfers which occur during the transaction.
  • Brokers Commission: This is the fee that the seller agreed to pay his Orlando listing agent for selling the home.
  • Pest Inspections: Lenders usually require for a pest inspection to be performed on the property to make sure that it’s in good condition and hasn’t been damaged by any living organisms. If the report reveals that there is evidence of termites, carpenter ants, fungus or dry rot, the seller will usually have to correct the problem before closing the transaction. The seller will usually pay for this directly to the company making the repairs which means it won’t appear on the settlement statement.

Buyers will typically be responsible for additional fees which are mostly tied to their mortgage loan. Sellers are also responsible for some additional costs like the mortgage interest on their loan, unpaid property taxes, unpaid association dues, hazard insurance, etc.  The seller is responsible to pay these fees up until the closing of the transaction… and the buyer from then on. If the seller has already paid for some of these items past the closing date, they will be reimbursed at the closing. Other miscellaneous items like home warranties that the seller may have agreed to pay for will also be deducted from the seller’s proceeds.

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What To Expect When You’re Expecting… Your Home Inspector

Posted on by Jenny Zamora

By hiring a reputable home inspector, you’re protecting your investment. Most potential home buyers have their homes inspected before buying. The question is… who is the person doing the inspecting? We’ve all heard of those shady, so-called “home inspectors” that try to tell you about problems that aren’t really there just so they can offer to do the repairs for you. Or what about the ones that just don’t care and end up missing major issues with the house because they were in a rush to get out of there.

Orlando Realtors claim that the problem with the home inspection industry is that it’s not closely regulated and it’s seriously lacking in the quality control department. It’s important to ensure that the inspector you choose is licensed, insured, and experienced. Remember… this is someone you hired to help you decide if you’re going to commit to buying this home or not… which is one of the biggest financial commitments you’ll make in your lifetime.

To make sure you hired a true professional these are some tips on what to expect when you’re inspecting your inspector.

  1. Certification- Make sure that your home inspector went to a reputable school that requires annual re testing for all active licensees.
  2. Insurance- Your home inspector should be fully insured including liability, workers comp and E& O [errors and omissions] Insurance. If your inspector can’t provide you with proper proof of insurance, then it’s time to keep looking.
  3. Guarantee- A good home inspector will have no problem backing up his findings with a written guarantee.
  4. Conflict of Interest- It’s never a good idea to hire a home inspector that’s also a contractor. He could end up trying to make a career out of your house. First he’ll charge you to do the inspection, then he’ll want you to hire him to fix everything. Be sure to hire a home inspector that works as a home inspector full-time.

When you’re ready to hire a home inspector, ask your Orlando Realtor for a recommendation. Your agent should be able to provide you with at least 2 or 3 good ones.

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Buying A Home With Others

Posted on by Jenny Zamora

Don’t do it!!!!  Would be my first words of advice for anyone who asked me whether it’s a good idea or not to buy a home jointly with someone other than your spouse. However, for some people, it’s the only way they can afford to buy a home. If you share the costs with friends or relatives owning a home becomes more affordable and less stressful.

Top Orlando Realtors report that the problem in today’s real estate market home prices are just out of reach for many people so they pool their resources with friends and relatives in order to make it happen. This allows the homeowner to afford a home that they otherwise wouldn’t be able to afford on their own.

“Neither I nor my brother had enough money for a down payment in a decent Orlando neighborhood,” said one of our buyer clients…” By both of us splitting the costs we were able to buy an Orlando home large enough for both our families”.

Whenever you come to any kind of financial arrangement with friends or family, you should plan carefully to try and avoid any pitfalls that may arise from your agreement. The last thing you want is to damage a personal relationship because of a business arrangement.

Decide How Title Will be Held

How a title to a property is held dictates who is qualified to sign documents as well as what happens when one of the owners passes away. Co-owners that aren’t married can share title to the home as “tenants in common” or “joint tenants with the right of survivorship”. Married couples that are also co-owners via “community property” or “tenancy by the entirety”

If each owner possesses an equal percentage in a property, joint tenants with the right of survivorship apply, with only one title held by all the owners. When one of the owners passes away, his or her percentage gets divided equally between the remaining owners. This goes on and on until ultimately the last surviving owner will own 100% of the property.

The percentages of “tenants in common” may or may not be equal because each of the owners will have a separate title. In this arrangement, there’s no right of survivorship so the property does not transfer to the last remaining survivor. All the co-owners can either pass on their percentage of ownership via will when they die or they can even sell their share of the property at any time. The downside to this way of taking ownership is that the remaining owners may end up being a co-owner with someone they don’t even know…

Similarities between “Tenants in Common” and “Joint Tenants with the Right of Survivorship”

In both of these ways of holding title, co-owners possess equal rights of possession. This means that each person can occupy and use the property. If the property is rented out or leased then each owner receives a portion of the rent in proportion to the percentage they own.

Establish Some Ground Rules

By writing up a co-ownership agreement you can avoid some of the pitfalls that can typically arise from a co-ownership situation. It’s extremely important to determine what the ground rules will be before making any commitments. A co-ownership agreement is basically the pre-nuptial agreement of homeownership. It addresses relevant concerns of all parties involved and specifically lays out what will happen if and when any of these concerns become an issue.

You might think that the friend or relative you’re doing this with will never become a headache or even worse… a nightmare. That’s why it’s so important to have everything spelled out in black and white. These documents are the only way to resolve ownership issues except taking them to court.

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TOR 033: Tips On Buying Foreclosure and REO Properties

Posted on by Jenny Zamora

In today’s 33rd episode of the “Top Orlando Realtors” Podcast, we talk about what to do and what not to do in order to buy an REO or foreclosure property successfully.

Here are some of the points discussed on today’s show…

  •  Buying the home “As-Is”…
  •  The Importance Of Getting A Home Inspection…
  •  Don’t Low Ball The Bank…
  •  Hurry Up and Be Patient!…
  •  Why you Should Hire An Orlando Realtor….

Just hit play to listen to the entire episode. If you still have questions about today’s topic call or text 407-902-7750 or feel free to visit us at https://orlandorealtyconsultants.com/contact/

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8 Things You Should Expect From Your Orlando Realtor When Selling

Posted on by Jenny Zamora

REALTORS Must Be Creative

Selling your home can be roller coaster of emotions if you aren’t mentally prepared, especially if you’re living in it. It means that you have to keep it showroom ready for any stranger with a pre-approval letter to take the ten cent tour. Then you stress about if they liked it or not… then you think to yourself….why didn’t they like it??  These are just a couple of examples of what some sellers go through.

Oh, and what about hiring an Orlando realtor to sell your home?… With so many agents out there, how do you know you hired the right one for the job? Just in Orlando alone there are over 8,000 active real estate agents!

 

The scary thing is that unless you do your research, you have no idea what their skill set is or their level of experience. Just last week I was visiting with a friend who owns a real estate school and she told me that every one of her classes are full… all of the time. Since it’s relatively easy to obtain a Florida real estate license people are clamoring to get one.

Many new agents believe that once they have their license, then the listings will automatically start falling into their lap. The truth is that only a small fraction of Orlando realtors are top producers, a good amount of average agents and the majority are so bad that they have no business being in the real estate business…but they are… so choose carefully.

 

So what should you expect of your Orlando realtor when selling your home? Your agent should be doing and practicing the following 10 things. If not, then unfortunately… you probably hired one of the bad ones.

 

If you are still searching for your Orlando realtor then use this 10 point guide to make sure you hire a hero and not a zero.

 

1- Honesty Is Their Policy

An honest agent means that they will always be truthful with you, even if it hurts. Honesty is also included in the REALTOR code of ethics. The problem is that sometimes you just don’t know just by meeting them. I’ve met some amazing liars in my time and yes…some of them were shady real estate agents. The truth will always come out …. eventually, the trick is to find out just how honest they really are before you hire them. You have to do your research before you commit or it will be too late.

 

Written testimonials aren’t enough. For all you know, they may have written their own testimonials. Ask them to provide you with some contact information of a few of their most recent seller clients and start reaching out to them and ask about there experience with Mr. Realtor. This will help you to separate the closers from the posers…

 

If they aren’t able to provide you with this information, then it means their clients aren’t willing to say anything nice about them or they don’t have any recent clients. Neither one of these reasons is a good thing and should be considered a deal killer.

 

 

2- Professionalism

Most homeowners assume that all real estate professionals are just that… professional, unfortunately, it’s just not the case.So how do you you know you’re dealing with a true professional? It starts with their appearance. Are they well groomed? Well dressed? A realtor who shows up in acid washed ripped jeans and a tiee die t-shirt probably won’t be taken seriously by a prospective buyer… or anyone else for that matter.

 

Being punctual is also a big part of demonstrating professionalism and shows that they respect the time of other people. I can’t tell you how frustrating it is to schedule a private showing for a buyer only to be left waiting on the front door step for the listing agent to show up.

 

A seller should expect the same of the realtor they hire to represent them and their home. If I set an appointment with someone and they show up late without a good excuse, then they’re pretty much done in my book. Anyone who doesn’t respect my time , doesn’t deserve my respect.

 

 

3- A Skilled Negotiator

A listing agent’s job is to sell their clients home for the highest dollar amount possible in the least amount of time…period. Therefore they have to be skillful negotiators in order to be effective. They have to know what to say to the buyers agent and know how to say it. Reviewing offers and countering offers is a true art form and you can’t appear too eager to lower your price. Sure… it’s ultimately the sellers decision but a good negotiator should advise the seller on what the next move should be.

 

 

4- Creativity  

Selling a home is not just plopping a sign in the front yard and praying for an offer. Although many real estate agents swear by this technique. Sometimes they will even bury a statue of St. Joseph in the front yard….Yup, that’s a thing!

A good realtor knows how to market a listing. Each home has it’s selling points or lack of and they need to know how to bring to light the best of the listing and even make the bad stuff sound appealing. Everything from the angle of the photos to the copy in the descriptions must be considered and marketed in the best light possible.

At ORC, we create a unique video for each and every listing. Everything from the script to the photos and even the music is carefully chosen to create the biggest impact. I would have to say that creativity is probably the area where most realtors are lacking. Everyone seems to do the same thing over and over.

 

5- Experience

It’s true, there is no substitution for experience and being battle tested. Homeowners commonly make the mistake of not researching an agent’s past results and instead hire an agent because they are a friend or a relative…. BIG MISTAKE! This is not the time to hire your niece that just passed her state exam two weeks ago. Find out how many transactions they’ve closed recently and how their clients enjoyed working with them.

 

You should also be wary of the agents who say “ I’ve been doing this for thirty years” sometimes these agents are even worse than rookie agents because they may have the same mentality they did 30 years ago. Real estate is ever changing and you must have an agent who is up to speed on how real estate works today.

 

6- Have a Team

 

A great Realtor will have a team of professionals that they work together with like a well oiled machine. From a good mortgage broker to the best title company to a list of qualified appraisers, contractors and home inspectors. This makes the whole process come together like clock work and can make selling your home a pleasurable experience.

 

7- Be A Good Communicator

 

There’s nothing I hate more than working with someone with poor communication skills. If I leavre a message, I expect a call back. If I send an email I expect a response. If I ask a question I expect an answer. A good realtor will keep their listing clienbt in the loop evry stepof the way throughout the entire process all the way to the closing. Selling a home is stressful enough as it is and if your agent is keeping you in the dark about what’s going on it just adds to the stress.

 

 

8- Internet Presence and Technology

 

These days realtors have access to some pretty powerful tools that helps with everything from lead management to marketing a property to the right buyers with just one click of a mouse. Some realtors avoid using the latest technology because they are afraid of learning something new when they should be embracing it and using it to it’s full potential. Technology exists so that we can be more efficient in everything we do. Realtors who refuse to get with the times will ultimately get left behind because there’s just no way they can compete in today’s market place.

 

Tech savvy Realtors will also have a strong internet presence from a state-of-the-art website to being active in the most popular social media sites. Having a blog [like this one] should be a given. Having a library of informational videos on their own Youtube channel is also a good sign. A few Realtors will even have a podcast so they can cater to people who prefer to listen as opposed to watching a video or reading an article.

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