Loan process- loans are a process that is invasive, repetitive & frustrating. Just be prepared to deal with the inconvenience. I suggest you shop a bit, 2-3 lenders and negotiate your terms based on your credit scores & strength in buying. Also gather all of your financial documents and expect that the lender will check & recheck again prior to closing to make sure nothing has changed. Please don’t go buy that new boat or other big ticket items during the process. Also, do not change jobs during the process.

Title company/closing- I have two closing companies I like to work with. They both have good communication and history with me. That is sometimes the person I have to lean on the hardest to pull everything together to get to the closing table.

Insurance- if you require a mortgage, you will need to obtain windstorm, homeowners & most likely flood insurance. Rates are based on age, construction type, preventative measures taken (wind mitigation report at the time of home inspection, also may need to have a 4 point inspection if the home is more than 35 years old) and elevation. Elevation is a big part of what you must consider. Flood insurance in VE & some AE zones can be expensive.

Condos – 95% of our condos include in the ‘maintenance’ fees the exterior Windstorm, Flood & Homeowners insurance. If you have a mortgage on a condo, be aware you will also need to insure the interior. The HO-6 policy typically runs about 100.00 to 125.00 a month.

Mobile homes –whether on the water or non water there are guidelines for financing on mobiles. Please be aware, Mobiles built pre-1976 are unlikely candidates for any type of finance other than private funding at a high interest rate. Previous to 1976, there were no wiring codes in place for Mobiles. Fannie Mae nor Freddie Mac will back a loan on these older mobiles. To finance a mobile home, you should only consider a Doublewide built 1976 or newer. There are some opportunities to finance a single wide (1976 +) but, be prepared to make this your primary residence. The other finance option is if you plan to tear the mobile down & build a house onsite. This construction loan will close the property & then fund on draws as needed but be prepared, you must start the construction process immediately and this loan is a more in-depth, lengthy process.

Investment property-if you are obtaining a mortgage for an investment property, be prepared for a larger down payment requirement along with a slightly higher than rates you may see advertised as standard rates. Are you selling another investment property? Let’s talk about a 1031 Tax Deferred Exchange. If you are approaching as a rental investment, the lender may require the appraiser to document the going rate for rental. Also the insurance may need to cover rental loss in the event property is not able to rent due to natural disaster, fire etc.

Rental & use yourself properties-Please keep in mind, Monroe County & the Village of Islamorada have rental ordinances in place. Rentals in a non gated community (i.e. any single family, mobile homes type property) are limited to a term of NOT LESS than 28 days. Gated communities (i.e. Condos) are allowed to set their own rental terms & limits but they do not all necessarily level out with local ordinances. There are only a handful of ‘short term’ rentals in the Upper Keys that are “legal” and those are Moon Bay, Ocean Pointe, Kawama Tower, Mariners Club & Lake Surprise 2 on Mangrove Lane only.

Vacant Land purchase-ROGO is a term you may see often regarding vacant land. That stands for Rate of Growth Ordinance. We don’t want to turn into Miami South. Tier 3 is the highest rated vacant lot, less than 3 is unlikely to be able to obtain a building permit. The ordinance in place has officials anticipating that we could be built out by 2020. That would mean now is the time to be very diligent in a vacant land purchase to confirm that the lot is in fact buildable. There are many factors in the county or incorporated cities in the Keys to determine whether a piece of land is buildable. Not limited to but certainly considerations is endangered species including snails, mice, rats, trees & overall habitat. Elevation & amount of hard wood hammock along with intended house size & impact on environment also adds to the determine of build-ability. The other quick alternative to building is to purchase an existing structure such as a mobile home (the municipalities are always happy to issue a permit to replace a mobile for the sake of safety & longevity). This direction is referred to as ROGO Exempt as long as the structure was initially permitted & acknowledged by the governing municipality, that should result in a short wait to obtain a building permit.

Taxes -Monroe County enjoys a lower tax base than most of S. Florida. You can expect an annual property tax bill in the vicinity of 1.% to 1.25% of your purchase price. Don’t rely on what the current owner pays. They could have purchased 25 years ago, and exercised their right to the Homestead Exemption (limits the increase in property taxes by 3% per year if you qualify).

Title insurance & closing costs-traditionally here in the Upper Keys, buyer chooses the title company to close with. Buyer pays for a new title insurance policy (a cost based on purchase price). Seller pays to update the current policy from the time they purchased. Other out of pocket expenses (but not limited to) are; Inspections, Appraisal, Survey, Elevation Certificate, recording fees, taxes on notes, property insurance, HOA applications if applicable, and courier fees if necessary.

Last minute pushes-pulling together a closing is not as simple as one would expect. Often this is the most stressful time for all involved, and you can expect the lender to ask for verifications of employment and resubmission of anything & everything you have submitted, surveys, insurance & title insurance all must be reviewed & approved by your lenders underwriter one to three days prior to closing.

Central Sewers - We have a state mandate that we have centralized sewers in place by 2012, with an extension. Key Largo is 98% completed, Plantation Key is mostly completed. Upper & Lower Matecumbe is in process, some remote properties still could be some time away for completion. The cost is two-fold. One to disconnect the old septic, dig the trench & put the new connection in place-that goes to the plumber. The second is the wastewater treatment district, which is typically charged as a non ad valorem tax and typically the remaining balance is transferred from owner to owner. You can pay this off in full at any time; most homeowners chose to pay over the course of 20+ years.

Permits & code violations - Four to five years ago, this was a not an issue that was checked or dealt with. Today, I check every property that I write offers on for open, expired permits & code issues. Closing companies also check this & will not close a transaction without the seller closing these out; this expectation is also in the standard language of our purchase contracts.

Comparable sales- when you find a property you have true interest in, I will help guide your offer by providing you some closed sales to base your starting offer on. These comps are most likely the same that an appraiser would use. We don’t have apples to apples lots of the time, but, I find the best comparables we have & go from there.

Please ask any questions I have not covered here, this is intended to get you off to a good start. Now, let’s find that piece of paradise for you!