Foreigners are able to purchase all types of property in Los Angeles with a substantial down payment, a liquid bank account or substantial reserves. In fact with recent interest rates and the strength of foreign currencies against the dollar, there’s never been a better time to purchase a LA home. Last year California accounted for almost 20% of foreign purchases.
Most real estate companies deal with foreign as well as domestic purchases. Shopping around for the best deals from a number of real estate agents is advisable.
Once you do find the perfect realtor for your search, you can start the browsing process. Your realtor will ask you some questions to get a scope of what kind of property you are looking for. Once you take a few tours and see something you like, you can make an offer through your realtor, and the negotiations begin. You and your realtor can agree on a purchase amount and a time frame for the offer to be valid to the seller (backing out period). If the seller does not agree on terms, the realtor will negotiate on your behalf, while keeping you in full knowledge of every step. Once all parties agree on a final offer, one can then shop for a mortgage if needed, or pay the full amount up front.
When purchasing a home, you may want to consider the following;
- Cost and other associated costs
- Location (property value, access to freeways, schools, stores)
- House structure (water/ gas pipes, pest issues)
- Safety of the surrounding area (always check the neighborhood at night also)
- House layout
Real Estate Companies
1714 Hillhurst Ave., Los Angeles, CA 90027
21 249 S Mednik Ave., Los Angeles, CA 90022
Hollywoodland Realty Co.
554 N. Larchmont Blvd., Los Angeles, CA 90004
( 323)469 3171
202 N. Canon Dr., Beverly Hills, CA 90210
3550 Wilshire Boulevard, Los Angeles –
When considering buying a home it is essential first to talk to a mortgage broker or lender, such as a bank, about your financial situation. A lender will require a credit check but as new expatriates have no credit in the USA, evidence of financial reserves for a substantial down payment is required, which is unavoidable unless you are paying it all up front (cash). Most expats maybe required pay a substantial down payment as big as 30% or above due to a lack of credit history since building credit can take time (and a good financial management to go with it). One way of building credit is by opening a check or savings account, applying for a credit card and/or retail charge card and using it for small purchases then paying it off immediately. If you do have a credit history in the US, 3 to 5% of the house’s selling price would be the least minimum, 10% being the standard.
Alternatively an American friend or family member with good credit can co-sign, or wait two years to collect two years W2’s (employee tax returns), two months of bank statements, and one month of pay stubs. Provide all these documents to your lender to conduct a credit rating. The lender will then discuss various price ranges and affordable monthly payment options. Once satisfied, the lender will provide you with a pre-qualification letter to present to a realtor or real estate agent with the price range you qualify for when looking for a home. Based on that, the realtor will present you with a list of properties.
If you need a loan, you can apply for a loan from private mortgage companies such as Countrywide or the banks listed below. Larger down payment off course means smaller monthly mortgage.
Banks Who Provide Mortgages
The following banks have branches all over Los Angeles. Check their website for locations.
1534 N Vermont Ave., Los Angeles, CA 90027
(323) 663-1950 or (800) 869-3557
Bank of America
3045 Wilshire Blvd., Los Angeles, CA 90010
(323) 730-9140 or (888) 293 0264
1500 Vine Street, Los Angeles, CA 90028
The closing process is the final stage of your purchase. After the home inspectors come and go, insurance has been purchased, the settlement costs have been worked out, and all documents have been signed, you will get your keys and be a new homeowner. With that said, these processes also come with costs of the following. Always remember that there are other associated costs besides what is on the price tag hanging from your future home.
- Loan originating fees
- Escrow fees
- Mortgage insurance
- Home pest inspection fees
- Homeowner’s insurance
- Property taxes
- Appraisal fees
- Legal fees
- Document prep, notary, credit report and other service fees
To someone who is not experienced in purchasing property, the process may seem slightly more complex than it was explained here, but with the help of a good realtor, the process can be broken down to the language better understood by first timers.
Purchasing a home is a big financial commitment and can be a confusing and risky business. It is recommended to hire a Real Estate Attorney to cover any discrepancies and a Certified Public Accountant (CPA) to resolve
any tax issues.
Mortgage.com offers advice on mortgage rates, plus a mortgage calculator and list of local brokers and lenders. http://www.mortgageloan.com
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