September 4, 2008 —NASSAU, BAHAMAS— Purchasing Bahamas real estate can be exciting and scary at the same time if buyers aren’t completely prepared for the process.

Knowing the five most common errors and omissions made by potential buyers and how to avoid them can go a long way to making the deal a success, said Rachel Pinder, principle broker of Island Living Real Estate in Nassau, Bahamas.

Failure to Qualify
One of the most common reasons a deal falls through is because buyers end up being unable to qualify for a mortgage, Pinder said. This could be avoided by pre-qualifying with a local lending institution.

“It’s frustrating for home buyers to fall in love with a house, only to find out that it’s out of their price range and they are unable to secure a loan,” Pinder said.

Pre-qualifying can make the home buying process easier, because buyers go into the search for a home knowing their spending limits. It also tends to have a psychological effect. It tends to show a seller that the buyer is serious about buying.

It also speeds up the final mortgage application process, since a great deal of the buyer’s information already has been provided, according to www.bankofamerica.com (http://www.bankofamerica.com/loansandhomes/index.cfm?template=learn_buy_a_home&context=loansandhomes_learn_bh_prequalify ).
 
There are several items needed to make the pre-qualification process go smoothly. Here are a few examples:

• A list of current debts, including names of creditors, amounts owed on each and monthly payments.
• Address of the last two places of residence. If previous residences were rented, provide the landlord’s name, address and phone number. If owned, include the name, address and phone number of the mortgage holder.
• Employment information, such as names, addresses and phone numbers of employers for the previous three years.
• Bank statements for the past three months.
• Recent pay stubs.

For a complete list of items, contact a mortgage lender.

Closing Costs
Often, buyers fail to realize the upfront costs involved in purchasing a home. The closing costs involved in closing a Bahamas real estate transaction typically include fees for legal services, title search, appraisal, government stamp duty tax and mortgage.

The government stamp duty tax is on a sliding scale and it is a percentage of the home’s selling price. It can range from two percent to 10 percent.

Failure to come up with money to cover these costs can cause a transaction to fall through, Pinder said.

Property Title
Sometimes deals fall through because the person trying to sell the property does not have clear title. Having clear title to a property means there are no mortgages, loans or liens on the property.

Realtors can avoid letting this situation kill a deal by asking to see the documents of title and a copy of a plan when taking a listing, she said. If this can be produced, it means the seller typically has clear title to the property.

Information Not Disclosed
Deals can fall through when an inspection is done and the potential buyer learns about property attributes undisclosed by the seller that could cause the buyer to not want to purchase the property.

Sometimes the undisclosed items can be an honest mistake. For example, if there is a hot tub or a security system in a home that never was used by the seller, they might not know if the items didn’t work.

Realtors can take steps to avoid this by reviewing disclosure statements and asking questions to find out as much information as possible about the property.

Zoning
There are times when a property on the market may be listed as a commercial property, but when it is set to close, the buyer learns that the zoning actually is residential and will not suit the purpose the buyer had in mind.

“It is important to find out from the government ministry the proper zoning of a property,” Pinder said.

Learn More
If you are in the market for Bahamas real estate, please visit Island Living’s Web site: www.islandlivingrealestate.com, or call them for a consultation: 1-242-322-7979/80.

About Island Living Real Estate
Island Living Real Estate has more than 25 years of experience in real estate sales and rentals throughout the Bahamas. Island Living’s main office is located in one of Nassau’s oldest historic buildings on Bay Street, named “Red Roofs.” Red Roofs was built in 1896 and has been home to various families, a Gourmet Deli and now Island Living.

We don’t just help you get the keys to your new home… we give you the keys to your new life.  Welcome home!

© 2008 Sinai Marketing and Island Living Real Estate. Authorization to post is granted, with the stipulation that Sinai Marketing is credited as sole source. Linking to other sites from this article is strictly prohibited, with the exception of herein imbedded links.

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