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.
FIRPTA Tax Withholding
Paragraph 10(i) outlines responsibilities when the property’s seller is a foreign person.
The contract now requires the seller to inform the buyer in writing if the seller is a foreign person. If the seller is not a foreign person under the law, the seller can give the buyer a certification of his or her non-foreign status.
General Property Inspection & Repair
Paragraph 12(b)(i) (General Inspection) deals with repairs requested by the buyer following a property inspection.
In the prior versions of this contract, the seller did not have a right to receive a copy of the relevant parts of the buyer’s inspection report related to the buyer’s written request for repairs. Now the seller has a right to receive the relevant portion of the written inspection report provided the seller makes the request in writing.
Concerning repairs, the seller now has up to 10 days instead of 5 days to obtain estimates for the following three items:
(1) General Repair Items;
(2) Wood destroying organism damage repair; and
(3) To correct permit issues.
Standard D changes when the seller has to provide to buyer either an estoppel letter from tenants or a seller’s affidavit.
Instead of five days after inspection, now Standard D requires the information to be provided at least 10 days prior to closing. The buyer may terminate the contract no later than five days prior to closing if the information submitted differs materially from leases provided earlier per Paragraph 6(b).
Per Standard F (Time) calendar days are used in calculating time unless there are certain exceptions and now there are more exceptions. Any specific date inserted in the contract which occurs on a weekend or holiday will be extended until 5:00 p.m. the next business day. However, time for acceptance and effective date will not change unless they occur on weekends or holidays.
Per Standard O, parties to the contract may now sign the contract using an electronic signature.
That concludes Part 2 of 2 discussing the remaining changes to the new FAR-BAR contract.
If you have questions or are looking to speak with experienced real estate lawyers in Miami-Dade or Broward County, contact ESQ.title at 305-501-2836 or visit us at JordanPascale.com