Home Property in United States
How to buy a house in United States?
Here you will find the detailed information about real estate purchasing in United States:
- the right way to choose the property and to effect the deal;
- property taxes and duties that should be paid;
- everything about home loans in United States;
- home property management and renting;
- rental, commercial properties and related investment properties.
Real estate for sale
Most recent offers from house owners in United States and from real estate agencies. Advertisements with the fixed price and auctions are listed here.
You can leave a comment and give advice to other visitors planning to buy a home in United States.
US regulations do not restrict foreigners from purchasing property, whether residential or commercial. A special authorization is not required either.
The purchase process starts with preselection of property. Nowadays there is a wide range of possibilities to do this: thematic exhibitions, printed publications and websites. More than 80 % of potential clients choose the Internet over other options. The next step is to choose an agent (broker). It is recommended to conclude a contract with the broker, who will act on your behalf from the beginning and up to the moment, when you will get the keys to new property. The agent can assist by choosing the best variant, calculating real market value, negotiating a favorable price with the seller, handling any kind of paperwork, as well as choosing a lawyer, a technical inspector and other specialists involved in the purchase process. Buyer does not usually pay any agency commission. The agent inquires client’s preferences concerning transaction period and budget, whereupon the buyer may be taken on a tour, in order to check out available options.
Possibility of remote purchase
If a buyer is not willing to come to the USA to purchase property, he or she may do so remotely. Some states allow handling real estate deals with a power of attorney, which can be issued at the United States embassy (consulate) in a country of residence. Buyer receives a special form of power of attorney by mail. After that, buyer has to transfer the funds to a so called trust account of his American representative, from which they will be transferred to seller upon the transaction completion.
In this case, the risks are practically brought to zero, provided that buyer employs the services of a certified specialist. Dealing with unclean titles to property may cause an attorney to lose their license, which is highly valuable and cannot be reissued. That is why a buyer can absolutely be sure that transaction is fully legal.
In some states, legal arrangements related to the deal are handled by an escrow company. Documents are signed at the United States embassy and sent to escrow, while the funds are transferred to a dedicated escrow account, and then transferred to seller after the deduction of all charges. Such method is also free of any possible risks.
Opening a bank account and carrying cash into the USA
A bank account is only required if property is purchased on credit. In case of cash payment, an account is not necessary. When entering the USA, it is not recommended to carry over $9999 in cash, since a larger amount is liable to a duty. The principal sum for the purchase and other expenses can be transferred to either an attorney’s account or a dedicated escrow account. Some Russian banks may require to present the contract of property purchase, in order to make this transaction. In most cases, when already in the US, buyer will not have to explain, where this money comes from.
Money brought into the United States is not taxes, since property buyer is not an American taxpayer. It is advised to also have a proof of money provenance, such as a sales contract for an apartment in homeland.
Signing a sale and purchase agreement and deal registration
The whole process of property purchase (except for getting a real estate loan) takes 15–30 days. When property is already chosen, broker prepares a price offer. This is a standard form contract, drafted by real estate associations of a state. The agent fills the papers, which are consequently signed by buyer, and sends them to the seller.
If price offer is accepted, the next step is to sign a sale and purchase agreement, also called a contract to purchase real estate, in the agent’s presence. There are some other mandatory participants of the deal that perform legal control, verification and certification of documents – a title company, an escrow company and a closing attorney. Buyer makes a deposit of 3–5 % of property value, which is retained by the title company or an agency with and exclusive right for property sale.
This stage may also involve physical inspection of property; however, such assessment is not compulsory. The procedure is performed by a certified specialist, who examines property for construction defects and inspects the condition of plumbing, wiring and other utility systems. Physical inspection of property costs $250–500. It might be a good idea to inspect real estate for termites or other insects, gas (radon), lead-based paint, and various types of mould.
Signing a sale and purchase agreement is followed by title search. This procedure is intended to reveal, whether current owners have any open mortgage liabilities, charges, etc., and carried out by an attorney or an escrow company representative. Title search cost is listed in total expenditures upon deal completion. Meanwhile, buyer should obtain mandatory property insurance. The title company handles all the related paperwork and issues a certificate of insurance to the new owner.
However, land purchase does not require any inspections or insurance. According to real estate agencies, land in the United States is the easiest to buy.
When full payment has been transferred to either title company or attorney’s account, buyer receives a document, confirming their right to property – a so called deed.
In many states, buyer becomes the rightful property owner only after the deed has been registered in a county court or a special registration chamber. In this case, title company submits the document to a county court clerk and then returns the registered deed to the buyer.
When signing a sale and purchase agreement, the parties decide who is responsible for which expenses. The closing costs make up 1–2 % of property value and usually include: attorney’s or title company fee, general property insurance, and record and litigation fees.
Broker’s fee is 4–6 % and usually covered by the seller. Transfer tax, which is 0.01–2 %, is also laid upon the seller.
It is also possible to get insurance protection against natural disasters, which costs from 1 % to 5 % of property value per year, depending on many factors (such as whether real estate is located in a flood-prone area).