As guidance to our foreign / international buyer clients, below is the process for buying a condo in Manhattan, New York. The process is similar for those buying the condo as an investment property or as a residence. Main difference is that for investment property buyers, downpayment required by the lender is usually much higher.
Estimated Time to closing after identifying property:
With Financing: 10 to 12 weeks
All Cash: 2 to 3 weeks
1. Obtain pre-approval from lender (1-5 days)
Lender can be US bank or overseas bank at foreigner's home country with international mortgage programs.
2. Identify Property (2 days - several months)
Property viewing can be a pleasurable or tiring experience. Make sure you work with a broker who will filter the properties to maximize productivity of your time.
3. Make offer and negotiate price (1 week)
Your broker's negotiation skills are critical. Experienced negotiators will obtain many favorable financial and non-financial terms for the buyer.
4. Execute contract (1-2 weeks)
The agreed upon terms are provided to both parties' attorneys who will prepare the contract. The buyer's attorney will perform due diligence on the property prior to the actual contract execution. Once everything is agreed upon, the contract is executed. At this time, a 10% deposit will be required from the buyer to be held in escrow by the attorney.
5. Apply For Mortgage and Obtain Commitment Letter (6-9 weeks)
The buyer applies for a mortgage and the lender will perform it's due diligence, including appraisals etc. Consequently, the lender will issue a commitment letter.
6. Submit condo package to condo board for approval (1 to 4 weeks)
7. Schedule Closing
At closing, all parties - buyer, seller, bank, attorneys, brokers, will come together at a table. A lot of paperwork are signed and funds will be provided to the seller in exchange for the buyer getting legal title to the property. The deal will be completed at the table and usually no future follow-ups are necessary.
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