U.S. Real Estate: buy, finance, and protect your transaction

1. Introduction to the U.S. housing market

The U.S. housing market is large, local and highly decentralized. Buying in Florida, Texas, Arizona or Illinois can involve different contracts, inspections, taxes, closing customs and title practices.

Unlike civil-law systems, there is no single notary model. Transactions usually involve an agent, lender, title company, escrow officer or local attorney. The deed is recorded at county level.

2. Federal and state authority

Federal rules cover fair housing, lead paint disclosures, mortgage disclosures, federal tax, housing finance oversight and flood mapping. State and county rules govern contracts, licensing, recording, local taxes, HOA law and many buyer protections.

3. Fair Housing Act (HUD)

The Fair Housing Act prohibits discrimination in housing sales, rentals and financing based on federally protected classes. State and local laws may add protections. Verify current rules with HUD on the date you act.

4. EPA lead-based paint disclosure

For many homes built before 1978, sellers and landlords must disclose known lead-based paint information and provide required federal materials. Buyers should confirm current forms and consider specialized inspection.

5. CFPB TRID, Loan Estimate and Closing Disclosure

TRID governs consumer mortgage disclosures for many residential loans. The Loan Estimate summarizes expected costs. The Closing Disclosure shows final charges before closing. Timing and tolerance rules must be checked with CFPB.

6. Government-backed loans: FHA, VA and USDA

FHA, VA and USDA programs can support financing through participating lenders. Eligibility depends on borrower status, property, income, location and program rules. Limits and conditions change.

7. FHFA, secondary market and conformity

FHFA oversees Fannie Mae and Freddie Mac and affects conforming loan standards. Nonconforming loans may involve different underwriting, pricing and documentation.

8. FIRPTA withholding

FIRPTA may require withholding when U.S. real property is sold by a foreign person for U.S. tax purposes. IRS forms, exceptions and withholding certificates should be handled with tax counsel before closing.

9. IRS Publications 527 and 523

Publication 527 covers rental income and deductible expenses. Publication 523 covers sale of a main home and possible gain exclusions. Neither replaces personalized tax advice.

10. FEMA / NFIP flood zones and insurance

FEMA flood maps can affect mandatory flood insurance, project cost and resale. Compare NFIP and private coverage carefully, especially near coasts, rivers or low-lying land.

11. Title insurance and title chain review

The title company searches ownership rights, liens, easements, mortgages, judgments and title defects. A lender's policy protects the lender. An owner's policy protects the buyer against covered historical title defects.

12. HOA: homeowners associations

An HOA may enforce CC&Rs, assessments, use restrictions, reserves and penalties. Read the budget, minutes, litigation, special assessments and rental restrictions before committing.

13. Typical forms and documents

14. Three-step pathway

1. Search and offer. Define state, county, budget, financing, contingencies and inspection.
2. Financing and due diligence. Compare lenders, review title, HOA, flood zone, taxes and insurance.
3. Closing. Review the Closing Disclosure, sign, record the deed and retain all records.

15. French and international buyers

Nonresident buyers should plan for FIRPTA on resale, cross-border taxation, ITIN, bank account setup, funds transfer, insurance, estate issues and financing without U.S. credit history. Tax treaties may affect analysis but do not replace specialist advice.

17. Frequently asked questions

18. Official links