Real Estate Contracts

Standard Florida Real Estate Contract (Part 2 of 2)

Published on: September 26, 2013 | by ESQ.title

By: Dan Pascale, Esq.

Offices located in Delray Beach and Coral Gables, FL

Here is Part 2 of the new FAR-BAR Contract blog post:

Buyer Closing Costs

Paragraph 9(b) offers a list of closing costs to be paid by the buyer. The owner’s title policy premium has been added as a bullet point because buyers have been paying this cost when 9(c)(iii) has been checked.

Under the contract options of paragraphs 9(c)(i) and (ii), the owner’s policy and charges will now also include a municipal lien search.

If paragraph 9(c)(iii) (the Miami-Dade or Broward County provision is selected) a municipal lien search has already been included.

Flood Zone and Elevation Certification

Paragraph 10(d) now includes a blank space where the parties can insert the amount of time a buyer has in which to terminate the contract for flood zone related reasons. If the blank line is not filled in, the time frame defaults to 20 days from the contract’s effective date

In addition, a disclosure has been added to Paragraph 10(d). In some cases, a buyer will have to pay actuarial rates for flood coverage that could be notably higher than the seller was paying. The disclosure explains this possibility and the type of buyers that could be affected by the change.

Finally, the disclosure now informs the buyer that a new elevation certificate may be necessary.

Standard Florida Real Estate Contract (Part 1 of 2)

Published on: September 14, 2013 | by ESQ.title

By: Dan Pascale, Esq.

Offices located in Delray Beach and Coral Gables, FL

The Florida BAR and Florida Association of Realtors recently adopted a new standard real estate contract. Because the new “FAR-BAR” contract will control the majority of residential real estate transactions in Florida, it is important to understand what amendments were made. The following is not an exhaustive list of differences between the old and new FAR-BAR contract, but summarizes some of the major changes:

Personal Property

The Check Boxes in Paragraph 1(d) were removed. To simplify the contract three items were added to the list of items transferred by the seller at the time of sale: (1) refrigerators, (2) smoke detectors; and (3) storm shutters. If the buyer and seller want to include additional items of personal property to be transferred to the buyer those items can be inserted at the bottom of Paragraph 1(d).

Is a Verbal Option to Purchase Real Estate in Florida Enforceable?

Published on: September 12, 2013 | by ESQ.title

By: Daniel T. Pascale, Esq.

Offices located in Delray Beach and Coral Gables, FL

Consider a scenario where you have been leasing a residential property in Miami on a month-to-month basis for a little over a year but would like the eventual opportunity to purchase the property. Over the course of several lengthy conversations between you (the tenant) and the property owner (the landlord), the landlord ultimately agrees to give you the exclusive option to purchase the property once you resolve some old credit issues associated with a prior foreclosure. After your landlord gives you at least two verbal assurances in one week alone that you have an option to purchase the property and you shake hands on the agreement, you believe that the “deal is done.” However, after searching on Zillow one week later, you discover that your landlord has listed your property for sale with a broker. You immediately contact the listing broker and are told that the property is now under contract for sale to someone else and that you have one month to leave.

What are your legal rights in this situation? Can you sue your landlord to enforce the verbal option agreement that you accepted? Do you really only have one month left before you have to leave when you have lived at the property for over a year? Sadly, the answer to all of these questions is that you have no right to purchase the property or legal recourse against your landlord. To make matters worse, it’s also true that you have no legal right to stay in the property for anything longer than the thirty days that the landlord provided. Here is why, and here is how to prevent this tragic situation from playing out in the first place:

Deal-Maker vs. Deal-Breaker: What is a Real Estate Lawyer’s Role in Real Estate Deals?

Published on: August 19, 2013 | by ESQ.title

By: Alejandro E. Jordan, Esq.

Attorneys working on complex real estate deals frequently forget that they are being employed to advance their client’s business objectives, not destroy them with a litany of complications, caveats, and “what-ifs”. After all, at the end of the day, clients employ their attorneys to be deal-makers, not deal breakers.

The difference between the two types of attorneys frequently boils down to their training, experience, and business acumen on the challenging deals that pay the premium dividends. Of course, real estate lawyers must advise their clients on the downsides of a particular deal, but the decision must remain with the client at all times. Even though it is the client’s investment that’s at play (and not the lawyer’s), many lawyers like to “play client” rather than offering guidance and then letting the “real” client decide whether the deal should go forward.

Florida “As Is” Real Estate Contracts

Published on: August 12, 2013 | by ESQ.title

By: Daniel T. Pascale, Esq.

Offices located in Delray Beach and Coral Gables, FL

As the real estate market in South Florida continues to heat up, more homeowners will undoubtedly list their homes for sale in Miami-Dade and Broward County. An important issue that all prospective homebuyers should investigate is what, if any, encumbrances are on the property being sold. Encumbrances are loosely defined as any claims, liabilities, violations, or problems that lessen a property’s value or restrict its marketability. For instance, perhaps the property is located in an uninsurable flood zone, violates height restrictions, or has an illegal mother in law suite that violates the city or county code. Unfortunately, the prospective purchaser may not notice any of these problems at the initial or even subsequent visits to the property, and so they may not be able to include those problems as desired repairs in the initial offer.

Fortunately, the standard Florida Realtors/Florida Bar approved contract provides the prospective purchaser with the right to inspect the property for a limited amount of time and back out if he or she finds too much to be wrong with the property. The default inspection period of time is 15 calendar days unless the parties agree otherwise. The property inspection clause provides the purchaser with the opportunity to retain a real estate lawyer in order to perform the necessary due diligence on the property to evaluate the situation. If the prospective purchaser finds problems, the property inspection clause gives the prospective buyer the right to terminate the contract without losing their deposit. Of course, the buyer also has the right to demand that the seller reduce the sales price to allow the prospective buyer to repair the property themselves. If the seller refuses to amend the contract, the purchaser can then choose to exercise his or her right to back out of the contract.