In September of 2015 the FAR/BAR “AS IS” Residential Contract For Sale And Purchase which is used in 90% of all the transactions in the Jupiter area will be changed to reflect the CFPB regulations impacting the residential lending industry. These CFPB regulation are scheduled to take effect Oct. 3, 2015.
Click on this Florida Realtors-Florida Bar-ASIS-4 September to see the red lined document illustrating where the changes will be made. Basically though:
- The expected time for financing approval is now 45 days. 60+ day Closings will now be the norm and the cash offers will look much more appealing to the Seller.
- The Closing can be extended for 10 days is need be to comply with these new laws.
- HOWEVER, if the Closing is extended to comply with these new requirements it does not affect the window (7 days prior to the Closing Date) where the Contract may be terminated under Paragraph 8.
- Title commitment (for financing sales) must now be issued 15 days prior to Closing. It was always silly to me have the title commitment issued 5 days from the Closing and have a 5 day window for the Buyer to object to same. The title to the property IS what is being purchased. It is central to the transaction. As a practical matter though most title agents send the title commitment long before the deadline anyway. REMEMBER, the Buyer still only has 5 days after receipt of the title commitment to object to anything contained in it. Where this will be sent sooner now be sure EVERYONE, the lender and the Buyer and the attorney for the Buyer review it in this time frame.
- Survey must be done before the Title Commitment. Makes sense as the title insurance the Lender will require can not have an exclusion for encroachments, thus the title agent needs the survey for this. Look for the Title Agent to require the Buyer to pay for the survey up front instead of at Closing.
For those seeking a loan after 3 October 2015 you should download and review Your Home Loan Toolkit can be downloaded online through CFPB’s website.