The sensible approach to property investment in the USA
Due to the fact that there are no restrictions on foreigners purchasing real estate in the USA, it is easy for investors to buy cheap land. However, for those who want to make a good and profitable property investment it pays to think the process through carefully and take the following factors into consideration.
Legalities
First of all it is important to be aware of the legal restrictions regarding property investment in the USA. Purchase requirements and taxes differ from state to state, so it is advisable for any buyer to find a professional lawyer for guidance concerning these affairs. In addition, it is also vital for an investor to be aware of visa requirements and know the restrictions before even starting to look for cheap land or property.
Finances
Before starting the search any investor should also be aware of the costs involved, so that they can decide whether they can actually afford all the costs. The money required when purchasing property in America depends on a number of factors, including the purchase agreement, the type of loan being taken out and the laws in force in the state. In general, an investor can calculate the additional fees as being between three and six per cent of the property's cost. These include the down payment, loan fees, inspection costs, stamp duty and mortgage insurance. The seller pays the money required for the estate agent or realtor.
Professional help
It is always advisable to seek professional help. A local agent will be able to give specialist advice as to the area and will be familiar with all the procedures involved in procuring a property within the region. It is also sensible for the prospective purchaser to get in touch with a mortgage broker. They are able to assist with calculating how much can be spent on a property and give the buyer more credibility with agents and sellers.
Surveys
Any investor must be aware that when they make an offer for a property they are accepting it in the condition that it is in. After the deal has been closed they cannot bring up any defects, which is why it is important for the prospective buyer to have the property fully surveyed. By doing so, they can be sure that they are completely satisfied with it before closure of the sale. Any defects found can therefore be dealt with before the paperwork is complete.
Title insurance
After the first contract has been signed a closing date is set. This is the date by which everything must be finalised; it tends to be about 30 days from the signing of the contract for sale. Within this period the buyer should purchase title insurance. This protects him or her in case a situation occurs in which the title becomes 'clouded'. In other words, in case another person, who was not disclosed, is also interested in the property. This could be a previous lender who has a partial claim on the title of the property. Title insurance protects the buyer from any financial loss that may occur.
