Islamorada and The Upper Keys

When we have a bilateral or effective contract what does that mean and then what next?

A bilateral contract means everyone agrees on the terms of the contract÷The price-closing date-money down etc and they have all signed off on it.. At this point the clock starts ticking on the addendum or contingencies.



What are some typical Contract Contingencies?

These can range from a wide variety of things, such as:

The buyer who lives out of the area but when we do find the right home or business, wants to present an offer--this would be written as---sale is contingent on the personal inspection of the buyer(generally done 10 days from bilateral agreement)


I have to sell my home first.

This is written simply as that. The sellers will generally require a copy of a listing agreement. Plus it is fairly standard policy for the home you want to continue to be marketed with what we call a kick out clause. That is if a buyer comes along with an offer and can close before you can you are generally given 48 to 72 hours to come up with the down and get the home closed. Before this happens, if you live in Florida you may be able to get a bridge loan or an equity loan would be another possible way to go.

Grouped in with contingencies are as is addendum's. Homes in the Keys are sold as is with right of inspections. There are generally three types of inspections done



The Inspections When?

Generally are done within 10 days of the contract going bilateral.

What kinds


General-Electrical, plumbing, structure, windows, doors, appliances.($300 and up)
  Termites-The home is inspected for any past damage and/or existence of living termites. We do have termites down here and the standard solution is to tent the house.($200 up÷some inspectors perform both the general and the termite inspection)

Septic. This inspection will determine that the septic is in good working order and that the drainfield is not backed up. The septic is pumped and then the tank is filled with water to check that it empties properly. (Average$300)

Aerobic system. These are the newer waste treatment systems. Generally a local company will have a maintenance contract. They will come out and inspect it to see that everything is functioning properly.(Average$100 for company to check)



What if there are problems?

This becomes a negotiating point. Whether they are extensive or not, we can ask that they be repaired or the money credited back at closing (if you can do the repairs) This can also depend on the price you get the home for. If you get a particularly good deal, some sellers will not take care of anything÷as is really means as is!

In some cases we will have to get estimates. This whole process again is a matter of negotiation.



The appraisal

A-Who-The Bank orders the appraisal.

B-When-It is generally ordered after the inspections and everything seems to be in good order to proceed.

c-Where does it go to:

The bank needs it to justify the loan amount. The Insurance company also needs it in order to establish the insurance value.

Insurance÷Wind-Flood-Homeowners

Assumable-Some insurance policies down here are assumable (wind and flood) as the rates are set and don't vary. It is generally easier to continue with the same policy. The key thing here is an elevation certificate. If the insurance is not assumable, you will need an elevation certificate. This can either be gotten from the previous insurer or it is done during the new survey.

V and E zones. Most canal homes are in A zones. Open water in most cases is considered a V zone. What this means is that A zone flood insurance is about a third of the cost as V zone.

Homeowners insurance will vary in cost based on value and contents. I will find out for you the current insurance company and check to see if it is assumable, and find out about the elevation certificate.


The survey

A-Who-The Title company orders the survey

B-When-This is generally the last item that is ordered-after a loan commitment has been established.

C-How much-generally about $400

The closing company

Then closing company does the title search and gathers all the documents necessary to finalize the deal.


Closing costs. Closing costs are negotiable, but generally the buyer-

Pays for the buyers title insurance(necessary for a mortgage)

Pays a year in advance for the Insurance.

Pays all costs or bank charges.

Pays prorated taxes for the balance of the year.