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What were the changes made to the Far Bar As-Is Contract in 2023?

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In 2021 the Far Bar As-Is Contract was significantly updated. But the most recent version was updated in 2023. What were those changes? They had to do with the new Florida law regarding the ownership of certain properties by certain foreign Buyers:

ATTENTION: SELLER AND BUYER

CONVEYANCES TO FOREIGN BUYERS: Part III of Chapter 692, Sections 692.201 – 692.205, Florida Statutes, 2023 (the “Act”), in part, limits and regulates the sale, purchase and ownership of certain Florida properties by certain buyers who are associated with a “foreign country of concern”, namely: the People’s Republic of China, the Russian Federation, the Islamic Republic of Iran, the Democratic People’s Republic of Korea, the Republic of Cuba, the Venezuelan regime of Nicolás Maduro, or the Syrian Arab Republic. It is a crime to buy or knowingly sell property in violation of the Act.

At time of purchase, Buyer must provide a signed Affidavit which complies with the requirements of the Act. Seller and Buyer are advised to seek legal counsel regarding their respective obligations and liabilities under the Act.

Agents Must Send Copies of Escrow Checks – Right?

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Source: Agents Must Send Copies of Escrow Checks – Right?

Agents Must Send Copies of Escrow Checks – Right?

By Meredith Caruso

In a nutshell: Unless a contract states that a copy of an escrow deposit must be sent to the seller, a buyer or their agent has no legal obligation to do so.

ORLANDO, Fla. – Florida Realtors Legal Hotline gets many questions about the rules governing escrow deposits – and many come from listing agents upset because they haven’t received proof, or at least notification, that the buyers made deposits by the dates stated in the contract.

Here is an overview of the most common issues:

Proof of deposit

This call usually starts with a statement like, “I have been waiting for the buyer’s agent to send me a copy of the deposit check! It still hasn’t been sent and I asked for it days ago!”

Let’s make this point clear: No law requires an agent to send a copy of an escrow check (or wire transfer) as proof that an escrow deposit was made. Furthermore, a copy of a check proves only that a check was written – not that it was given to the escrow agent in accordance with the contract.

You can certainly ask for a copy of the escrow deposit check (or wire transfer), but if you don’t get one, it doesn’t mean something was done illegally or not in accordance with the contract. Short of your contract requiring a copy of a check to be sent by a certain date, there simply is no requirement for this.

Verification of deposit

The requirement for verification of escrow depends on who chooses the escrow agent – the buyer or the seller.

If the buyer chooses the escrow agent…

Section 61J2-14.008(2)(b) of the Florida Administrative Code says the following rules apply:

  • If the buyer is choosing a title company or attorney as the escrow agent, the licensee who prepares the contract must indicate the name, address and telephone number of such title company or attorney on the contract. Please note: Putting “TBD” (to be determined) doesn’t comply with this rule.
  • Within 10 business days after each deposit’s due date, the broker representing the buyer must make a written request to the title company or attorney, asking the escrow agent to verify receipt of the buyer’s deposit.
  • Then, within 10 business days of the date that request was sent, the broker for the buyer must provide the seller’s broker with a copy of the confirmation of receipt from the escrow agent.
  • If there was no response from the title company or attorney, then that buyer’s broker must inform the listing broker that they did not receive verification from the escrow agent.

Note. This rule only applies if 1) the buyer chooses the escrow agent, and 2) the escrow agent is an attorney or title company.

If the buyer chooses a title company or attorney as escrow agent, the buyer’s broker must comply with Florida Administrative Code and provide a response to the listing broker.

If a broker – not a title company or attorney – holds the escrow, then the two brokers involved in the transaction can confirm receipt upon request, but there is no verification procedure required by law.

If the seller chooses the escrow agent…

Should the seller pick a title company or attorney as escrow agent, the above rules don’t apply – and there is no verification requirement. The listing broker can contact the escrow agent directly to verify receipt of the deposit.

Understanding the role of the agents with respect to escrow verification is key to avoiding potential unnecessary conflict.

Meredith Caruso is Associate General Counsel for Florida Realtors
Note: Information deemed accurate on date of publication

© 2023 Florida Realtors®

Solar Panels – Questions to Ask Before Contract

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Source: Solar Panels – Questions to Ask Before Contract

Solar Panels – Questions to Ask Before Contract

By Joel Maxson

If a seller’s home has solar panels, they should research how those panels could impact their transaction before going under contract.

ORLANDO, Fla. – If a seller has solar panels installed on their property’s roof, it’s worth investigating whether the way those solar panels are financed or leased could impact a future transaction. Many sellers aren’t aware of these issues, so if you ask the right questions, you can set them on the path to success.

  1. Do you own the solar panels or are they leased?
  2. If you own them, are they financed?
  3. If they’re financed, do you plan to pay the debt off before going under contract (or before closing), or will you ask a buyer to assume the debt at closing? Note: Lenders may not allow a buyer to assume the debt, and there could be application and transfer fees.
  4. If they’re leased, do you plan to end the lease early or attempt to assign the lease to a buyer? Note: Attempting to assign a lease could raise the same issues as attempting to assign a debt.

Here’s a closer look at these categories. This is a very broad-brush overview, so sellers should conduct their own research into the specific terms they agreed to and how their lender or lessor may help or hinder them in reaching their goal of selling the property.

Owned outright without financing

This is the simplest case. Solar panels will likely be a fixture that is part of the real property the buyer is purchasing unless the seller specifically excludes them in the contract.

Owned outright with financing

Although many sellers have heard that solar panel financing can be assumed by a future buyer, that doesn’t mean it will be allowed for a specific transaction. If it is allowed, then the seller will need to figure out what costs and steps are required to make that assignment and assumption happen, as well as what obstacles may get in the way of a successful handoff.

If a buyer is getting a loan, will the lender allow them to assume the solar panel debt? This is such a common issue that the drafters of the Property Assessed Clean Energy (PACE) Disclosure added this bolded warning:

“In the event Buyer is obtaining a mortgage loan to purchase the Property, be advised that MOST MORTGAGE LENDERS WILL REQUIRE THE SATISFACTION OR RELEASE OF THE PACE FINANCING FROM THE PROPERTY.”

If the buyer is willing and able to assume the debt at closing, then the parties should have an attorney prepare some language to add to the contract that spells out specifics. What tasks does each side need to complete? What deadlines do the parties want to implement? What if there’s a delay or denial? A well-drafted clause should answer these questions and more.

Leased

Like financed solar panels, the main question is whether the seller is going to terminate the lease or attempt to assign it to the buyer before closing. If they want to assign it at closing, they should have an attorney add a clause to the contract that answers the questions about tasks, deadlines, and what happens if there’s a delay or denial.

These leases often run for many years. And they may not offer an easy or affordable way to terminate early. That means sometimes a lessee may have to choose between paying the solar panels off or seeking a buyer who can take an assignment. That said, the terms of a lease can vary from one to another, so the seller should research their specific circumstances and come up with a sound plan before going under contract.

Joel Maxson is Associate General Counsel for Florida Realtors
Note: Information deemed accurate on date of publication

© 2023 Florida Realtors®

Should I apply for a homestead excemption for a property where the taxes had been going up by 10%

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I had this just come up. Working with a person who has owned and lived in a property for YEARS but never “bothered” to get a homestead excemption. The tax valuation of the property had “only” been going up 10% a year. Thus for this last year the (in round numbers) appraised valuation or “market valuation” was 2.2M BUT the tax valuation was 1.2M. My first thought was to apply for a homestead exemption, then sell the property (or not), then “port” the tax valuation savings (capped at 500K) into a new property. NOPE! Tax man has that angle covered. I called the property appraisers office and was told that the establishment of a homestead is what they called a “re capping” event, so just as if the property had been sold. Thus, if one were to apply for a homestead then the first thing that would is that the tax valuation would be set to the market valuation. Then the homestead valuation cap goes into effect.

Florida MILESTONE INSPECTION REPORT SUMMARY and STRUCTURAL INTEGRITY RESERVE STUDY.

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So I was looking at the updated Condominium Disclosure rider and I noted something. The new requirements for a Seller of a Condominium to provide a Buyer the MILESTONE INSPECTION REPORT SUMMARY and the STRUCTURAL INTEGRITY RESERVE STUDY are NOT lumped in with the other condo docs like the Declarations, Articles, FAQ etc with the right to cancel the Contract within (3) days (for non developers) of delivery, does NOT include these (2) documents.

I copied this from the disclosure:

MILESTONE INSPECTION REPORT SUMMARY: Pursuant to Section 718.503(2)(a)5, F.S., Buyer who has entered into this Contract is entitled, at Seller’s expense, to receive from Seller, before the sale of the Property, a copy of the inspector-prepared summary of the milestone inspection report, as described in Sections 553.899 and 718.301(4)(p), Florida Statutes, if (1) applicable and (2) the summary has been submitted to the Association.

STRUCTURAL INTEGRITY RESERVE STUDY: Pursuant to Section 718.503(2)(a)6, F.S., Buyer who has entered into this Contract is entitled, at Seller’s expense, to receive from Seller, before the sale of the Property, a copy of the Association’s most recent structural integrity reserve study or a statement that the Association has not completed a structural integrity reserve study.

I copied this from the statute refferenced:

(2) NONDEVELOPER DISCLOSURE.—

(a) Each unit owner who is not a developer as defined by this chapter must comply with this subsection before the sale of his or her unit. Each prospective purchaser who has entered into a contract for the purchase of a condominium unit is entitled, at the seller’s expense, to a current copy of all of the following:

1. The declaration of condominium.

2. Articles of incorporation of the association.

3. Bylaws and rules of the association.

4. Financial information required by s. 718.111.

5. A copy of the inspector-prepared summary of the milestone inspection report as described in s. 553.899, if applicable.

6. The association’s most recent structural integrity reserve study or a statement that the association has not completed a structural integrity reserve study.

7. A copy of the inspection report described in s. 718.301(4)(p) and (q) for a turnover inspection performed on or after July 1, 2023.

8. The document entitled “Frequently Asked Questions and Answers” required by s. 718.504.

(b) The prospective purchaser is also entitled to receive from the seller a copy of a governance form. Such form shall be provided by the division summarizing governance of condominium associations. In addition to such other information as the division considers helpful to a prospective purchaser in understanding association governance, the governance form shall address the following subjects:

1. The role of the board in conducting the day-to-day affairs of the association on behalf of, and in the best interests of, the owners.

2. The board’s responsibility to provide advance notice of board and membership meetings.

3. The rights of owners to attend and speak at board and membership meetings.

4. The responsibility of the board and of owners with respect to maintenance of the condominium property.

5. The responsibility of the board and owners to abide by the condominium documents, this chapter, rules adopted by the division, and reasonable rules adopted by the board.

6. Owners’ rights to inspect and copy association records and the limitations on such rights.

7. Remedies available to owners with respect to actions by the board which may be abusive or beyond the board’s power and authority.

8. The right of the board to hire a property management firm, subject to its own primary responsibility for such management.

9. The responsibility of owners with regard to payment of regular or special assessments necessary for the operation of the property and the potential consequences of failure to pay such assessments.

10. The voting rights of owners.

11. Rights and obligations of the board in enforcement of rules in the condominium documents and rules adopted by the board.

The governance form shall also include the following statement in conspicuous type: “This publication is intended as an informal educational overview of condominium governance. In the event of a conflict, the provisions of chapter 718, Florida Statutes, rules adopted by the Division of Florida Condominiums, Timeshares, and Mobile Homes of the Department of Business and Professional Regulation, the provisions of the condominium documents, and reasonable rules adopted by the condominium association’s board of administration prevail over the contents of this publication.”

BUT, the right of termination FS reads:

2. A clause which states: THIS AGREEMENT IS VOIDABLE BY BUYER BY DELIVERING WRITTEN NOTICE OF THE BUYER’S INTENTION TO CANCEL WITHIN 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, AFTER THE DATE OF EXECUTION OF THIS AGREEMENT BY THE BUYER AND RECEIPT BY BUYER OF A CURRENT COPY OF THE DECLARATION OF CONDOMINIUM, ARTICLES OF INCORPORATION, BYLAWS AND RULES OF THE ASSOCIATION, AND A COPY OF THE MOST RECENT YEAR-END FINANCIAL INFORMATION AND FREQUENTLY ASKED QUESTIONS AND ANSWERS DOCUMENT IF SO REQUESTED IN WRITING. ANY PURPORTED WAIVER OF THESE VOIDABILITY RIGHTS SHALL BE OF NO EFFECT. BUYER MAY EXTEND THE TIME FOR CLOSING FOR A PERIOD OF NOT MORE THAN 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, AFTER THE BUYER RECEIVES THE DECLARATION, ARTICLES OF INCORPORATION, BYLAWS AND RULES OF THE ASSOCIATION, AND A COPY OF THE MOST RECENT YEAR-END FINANCIAL INFORMATION AND FREQUENTLY ASKED QUESTIONS AND ANSWERS DOCUMENT IF REQUESTED IN WRITING. BUYER’S RIGHT TO VOID THIS AGREEMENT SHALL TERMINATE AT CLOSING.

(k) Structural integrity reserve study.—

1. A residential cooperative association must have a structural integrity reserve study completed at least every 10 years for each building on the cooperative property that is three stories or higher in height, as determined by the Florida Building Code, that includes, at a minimum, a study of the following items as related to the structural integrity and safety of the building:

a. Roof.

b. Structure, including load-bearing walls and other primary structural members and primary structural systems as those terms are defined in s. 627.706.

c. Fireproofing and fire protection systems.

d. Plumbing.

e. Electrical systems.

f. Waterproofing and exterior painting.

g. Windows and exterior doors.

h. Any other item that has a deferred maintenance expense or replacement cost that exceeds $10,000 and the failure to replace or maintain such item negatively affects the items listed in sub-subparagraphs a.-g., as determined by the visual inspection portion of the structural integrity reserve study.

It is worth noting here that the the Milestone Study is sent to the association’s local building department, where it can be examined by anyone who requests it. All one need do is to make a public records request for it.

144 Sweet Bay Circle Jupiter, FL 33458

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144 Sweet Bay Circle Jupiter FL 33458 in Newhaven in Abacoa

Located on a large pie shaped outside corner lot on a gorgeous live oak canopied street with with beautiful private pool and separate raised seating area/fire pit. The convenient porte cochere allows for extra shaded parking and dry unloading of luggage and guests. The large covered front porch gives the feel of “old Florida” living and the opportunity for easy outdoor living and friendly neighborly conversation. Life is easier close to world class everything: Jupiter Medical Center, Downtown, Youth sport & Amphitheater, Roger Dean Stadium, live music & special events, fabulous food, shopping, and unparalleled beaches, including Jupiter’s famous dog-friendly beach!

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