Advice: Buying a pre-owned house in TV with all cash
 

I'm not sure TV is any different from other Florida cities, but what has you experience been if buying with cash. I own a home outright and keeping it in South Florida but plan a move to TV. I've been up there a number of times, and coming up Saturday for a couple of weeks to look at homes. I know Villages Properties, FSBO and MLS are all seperate.

If I do find my dream home, appraisal wouldn't be requires especially if I get a great deal. :) I assume I can research myself if there are any liens on the house, or is there a way to request the seller to produce a certificate? (Not sure about that). I think I can go to whatever county assessor and request a lien search. Or hire a title company to do a search.

I shouldn't need Title insurance Policy if I come up with a clear title correct?

So I should only have to pay for a Recording Fees.

Anything else I might need that is specific to TV purchase?

Why pay cash with such low interest rates . I have owned 14 new homes and always put only 20% put your money in other things and especially now at 3% a year from now interest rates will have to climb and even a vanilla cd will bring in more than 3 %

Whether or not you pay cash or buy a FSBO should not affect any of the things you mentioned as long as the closing and title transfer are performed by a title company. If you are buying a preowned house, you should consider buying an owners title insurance policy in case a problem with the title comes up in the future. If you make an offer on a FSBO, I would highly recommend that either you or the seller have an arrangement with a title company in advance, so the title company can accept your earnest money and keep it in escrow until the closing. Don't pay any cash directly to the seller. If you make an offer through a real estate agent, always remember that the agent works for the seller and will share information about your discussions regarding how much you are willing to pay with the seller. Also, it is very important that you get an inspection of the house as a contingency in the sales contract. Many people use Frank D'Angelo, 352-250-7818, to do the inspection because he is very thorough.

If you really want to pay all cash, my advice would be to forget about saving a buck or two on title insurance, appraisals, inspections, etc. You will have a huge about of money at risk, so take every precaution to protect that money. I suggest you contact a local closing attorney and get them to guide you, pay them to work for you.

If you find a house you are really considering, contact Community Standards and ask them to research for any additions or landscaping improvements/additions, that might have needed a permit or approval. If work was done with out, then you could be held responsible for repairs or removal if somebody complains, and we do have some trolls who drive around looking for violations. Do your due diligence, or pay the price.:welcome:

I would probably get a lawyer to go over paperwork and a title company to research liens. Buyer title insurance is probably not needed, but I would get it just for safety in a RE transaction. One thing to check on an existing home is that they have all the ARC approvals for any changes they made, especially landscaping. While it probably won’t be an issue it is possible someone could come back and make you change something, especially if your landscaping is too close to property lines.

I think it is a personal choice as to whether you want to have a mortgage to pay each month with your estate responsible for taking care of the mortgage if you pass away while living in the house.

Good advise above about protecting yourself during the transaction

CD rates are awful. Even 5 year CD are only about 1.5%. That is usually where I’ve had my money but I’m think just plunk it down on a nice villa that I can come and go.

Most people that buy here do pay cash so it's not a bargaining chip. A new home would not require title insurance but a re-sale is a different story as you never know if there is a lien in process that has yet to be attached, a divorce in another state, etc.,etc., so play it safe.

Where did you get this fact, as it is the opposite of everything I have heard or read?

Whenever the issue of title insurance with cash buys comes up, I always say the same thing:

When you are paying cash for a house, you are the bank; therefore, do what a bank would do.

(I know how to search a title — sort of — and I have done that when buying houses up north, but even so, we still get title insurance. We got it on our pre-owned TV house, too.)

Like that old saying advises, “Don’t be penny-wise and pound-foolish.”

Please look at the post from retiredguy123, earlier in this thread. He is giving you excellent advice.

Good luck with your house hunt. You will have a lot to choose from.

Boomer

There is always the chance that a previous owner of this land pops up with a claim to the land. That is why we always have title insurance.

65% of new homes and I believe 55% of re-sales are cash buyers. The figures were in the Daily Sun but I could not tell you what date it was published. It was in one of those interesting little tidbits that say things like 6% of the owners are from New York, average age is 67, etc, etc. Also when we purchased our home here in 2017 we asked if there was negotiating room if paying cash and was told pretty much the same thing.

One major advantage is you can close much faster with an all cash deal.

Take advise about not buying Title insurance with a big grain of salt . Moat people who are really informed about real estate transactions will avise you to buy the policy. Penny wise and pound foolish !!!

Very true

Be sure to see if there is a bond outstanding.
I would get title insurance and have the title company do the closing.
You can also transfer your save out home inflation adjustment to you new home.

I took the Reverse Mortgage class from Citizens Bank a couple of years ago, they usually give it every other month at Palmer Country Club. Most people are aware that if you're at least 62 and own your home, you can get cash now, a reverse mortgage. It's about 45% of the appraised value. It was higher but in 2017 the government passed new laws requiring the banks to keep more reserves.

What I found interesting is you can use a reverse mortgage to purchase a new home. Let's say it's going to be your last home, you don't have any heirs you want to leave the home to, and it's your primary resident. If the home your buying is worth $300,000 with a reverse mortgage you put $140,000 down and don't pay another penny the rest of your life. You have that other $160,000 that you were going to put down now in your pocket to spend. You live in home, you essentially own the home, you pay the taxes and up keep, but you got it for less than half price. Then when you you die, just like a regular reverse mortgage the bank takes ownership and sells the home. If it sells for more than what you took out, your heirs get the difference.

Also I sold a home in Pensacola many years ago by owner, no realtor, no bank, no lawyer. The buyer and me went to a title company, I paid them $500 and he paid for title insurance and some doc stamps and stuff, and we were out the door in an hour. Easy thing to do in Florida. He could ordered an inspection, but since the home was only a year old, he didn't even have that done.

Scroll to the bottom of this page provided by Attorney's Real Estate Council of Florida
And The Survey Says: Who Pays for Title Insurance by County?

The Florida map of counties at the very bottom of the website shows that the SELLER of a pre-owned home pays the title insurance in Sumter County.

Life is funny. Sometimes your last house will turn out not be your last house and you want to move and do not have much equity at that point.

Reverse mortgage can get people to live above their means and than if they need additional funds for something do not have a source of it.

People should think long and hard before adding to debt in their olden years.

I have a reverse mortgage and two of my neighbors have them as well. I didn't use it to purchase, I paid cash in 2011. In 2018 I decided why shouldn't I enjoy the equity I have in my home. I have no heirs, we're both way past 62, this is definitely our last home, so we did it. I keep up the home, had the landscaping redone by Terrascape last year and the outside repainted by Oscar. I'm going to have the fiberglass shower replaced in the M/bath this year and maybe granite in the kitchen. I have no worries now about money, or where I'm going to live.

Here is a seller's perspective:. I don't care if you pay cash. The home has a value of XXX and it doesn't matter to me if I get payment from a cash buyer or a bank. I generally consider a cash buyer more of a pain in the arse than a bank.

Now if I was in some sort of financial straights that might be different but it is statistically rare here.

The only problem with the scenario you presented is that many people don't die while living in their house. They need to move into assisted living or a nursing home before they die. In that case, the bank can force them to sell the house before they may want to sell it, and they will lose a lot of money in reverse mortgage fees and administrative costs. So, if you can afford it, you are better off getting a regular 30 year mortgage with a 20 percent down payment and using the extra cash ($140K minus $60K) to make the 30 year mortgage payments. That way, you have a lot more flexibility about when and how to sell the house.

Excellent ! - What were you going to pay me with other than money ? Biggest fallacy that has been ingrained on us - I have a cash buyer. Think about that. I don't have any idea that you do or do not have the money. If you are applying for a mortgage the bank would tell me if you are qualified.

A timely and informative thread for us.

Thanks to the OP for starting it.

We have (in the past) paid cash for real estate purchases. We had to show proof of funds. They didn't just take our word for it that we had the money.

kathy

Thats cool to know.

I still think if I had too much money lying around earning next to nothing why not just buy some real estate outright in a place I enjoy spending time. I plan to pay off that bond as well, hoping I find a home with the bond paid. Wouldn't that be great. I thought I'd be spending my retirement money cruising the world and I was up until March 7th. Just don't think I'll be cruising as much as I use to. I always felt TV was like a cruise ship on land.

Nice to have a thread where people disagree but do so in a nice and friendly manner.

My former spouse just bought a home with cash a few months ago and had to show proof of funds. It was not a big deal. She sold her previous house to a cash buyer and her listing agent made sure she received proof of funds from them. As a seller I certainly would not want to take my house off the market for a period of time only to find the "cash buyer" could not come up with the money.

IMHO,

Contact ARC and see that ALL modifications to the property AND landscaping have prior ARC approval.
Contact the building department and confirm that the correct permits were pulled and inspections completed for any and all modifications to the house, you might want to work with Frank of both of these.
I would absolutely go with a title insurance company to make sure there are NO liens or other open actions against the property.
If you can talk to the neighbors, they can be a wealth of information. Ask if the homeowner was a DIY type person, there might be a lot more to look for.

I also tend to agree with some of the above comments, we could have easily paid cash for our house, instead we got 3% mortgage and almost 10% average return on investments over the the last 7 years (not including the last 3 months....), but of course this is a personal choice.

Hope this works out for you, Welcome to TV.

All cash or not, buy title insurance. It saved my butt last month. 12 years ago I bought a foreclosure in northern VA. We fixed it up and sold it in February to prepare for move to Villages. Two days before closing, the buyers closing company contacted me and told me there was an outstanding judgement against the house. Apparently, a previous creditor was still trying to collect from the previous owners and I was totally unaware - FOR 12 YEARS. In a panic, I left work, drove home and dug through all my original home purchase documents. I couldn’t remember if I bought title insurance way back when. I was concerned that I had done something stupid (like not buying title insurance) to save a buck or two. Thankfully, I found the title insurance docs and sent them out. Problem went away instantly and we closed on time. I will ALWAYS buy title insurance, cuz you never know If there are skeletons in the closet. A farmer’s undocumented land transfer. An heir. Who knows.

Depends on the seller. We bought from the Developer with cash. 10% down and settle in 30 days. We didn't have to prove anything but if we didn't settle they would have kept our 10%.

Paying cash is really part of your investment strategy. The money in my house is also appreciating and is part of my overall asset allocation strategy. My non real estate investments were up over 25% for calendar year 2019 so you could certainly make the case that I should have had the cash in my house invested elsewhere but I don't have a crystal ball.

You're correct, once you leave the home, it has to sold whether you're alive or not. Remember before I said, when you die and they sell the home, your heirs will receive any leftover amount.

We'll use numbers that are close to real. Let's say the home's appraised value was $300K and you had drawn $100K of the $145K that was available during the ten years you continued to live there.

The loan would be the $100K, it's the amount you've taken, the upfront fees which mine were $9,000 and my loan goes up $200 a month. Let's say they live in the home ten years and then sell the home. 120 months x $200 equals $24,000 plus the $100K you took and the $9,000 in fees. That's a total of $133,000 and they sell the home for $300,000, they might get even more since ten years have gone by, but we'll stay at the original appraised amount. So you would get $167,000.

That's why three of us on my block have reverse mortgages, once you find how it operates, it's makes perfect sense. Of course if you have children and want to leave them something, then don't do it.

Reminds me of when I sold my home in Baltimore in 2011 to the first person to look at the home, it was just 12 hours after I listed the home. When the agent called with the offer an hour after they left, I was a bit hesitant to take an offer so quickly that was $10,000 below asking. They had built a Wegman's across the street and it was opening in two months. The agent said, this is the manager of the new Wegman's, she's in town for two days with a letter from the Wegman's corporation guaranteeing the money. The company will buy the manager's homes when they transfer them, so they aren't consumed with buying and selling. I said yes, and called my Villages salesman Tony Trussler that afternoon and bought a courtyard villa sight-unseen that was discounted $12,000.

Once again I did a bad job of explaining my point of view. It was tossing around the phrase we have a cash buyer to me is insignificant as a seller. No matter what transaction takes place I get money (check) at closing. I don't care whose money, client or bank. If a real estate agent brings an offer to me from a client that is seeking a mortgage it's a pretty good bet the agent has prequalified the client or it would be a waste of both my and the agents time.

Showing proof of funds - did you have to show proof of funds before you looked at the house or as part of the offer ?

The world has changed relative to the stigma of I am a cash buyer. Watch buying a car video and one of the first rules is never tell a dealer you are a cash buyer - you just cut into the kickback they get from the finance company.

There are advantages to the seller when the buyer pays cash. First, there is no financing contingency in the sales contract, so the contract cannot be voided by a low appraisal or an increase in interest rates. About 5 years ago, former neighbors of mine signed contracts on three different houses and all of them were cancelled because the bank appraisals were too low. Another advantage to cash is that the closing can be scheduled within two weeks or so after the sales contract is signed.

Title insurance is peace of mind. Also when you do pay cash it means someone can Sue you the next day

I’ve bought several houses in The Villages all cash. Use a title company, an owners policy is worth the cost, I know people who have benefited because of things that didn’t show up right away and the title company had to pay later to clear up the issue. Tri-County Land Title & Escrow Company does a lot of these closings, cost is very reasonable, they can provide you with a legal sales contract and make the closing fast (relatively) and painless. A termite inspection is always a good idea In Florida and the extermination companies will do it for free in the hopes you will sign up for their services.