Melbourne Area Blog

Beginning next week we will begin using a new Purchase & Sales contract in the state of Florida. The current contract is 4 pages, the new contract is 11 pages. It seemed a bit much at first, however in and of itself it does clear up a lot of gray areas.

A few of the important changes:

Funds: Whether paying cash or buying with financing, buyers usually bring to closing the amount deemed on the closing statement as "Cash from Buyer". Usually the buyer would bring a bank check or money order in that amount to closing, made payable to the Title Company. New: Due to counterfeit bank checks, now the closing, disbursement of funds, and delivery of closing documents may be delayed until the funds are "collected" (bank term). This means not until the check is deposited by the Title Company and CLEARED. This delay can be avoided by planning to wire the funds to the Title Company a day or two prior to closing or delivering the bank check in advance to the Title Company.

Repairs: A seller has always been subject to paying an amount for repairs (other than an "As-Is Contract). There have been two separate categories for repairs; "General Repairs" and "WDO (termite)" repairs. New: we now have a third category. This addresses costs associated with closing out open or expired building permits and obtaining building permits for an existing improvement that was not permitted. New: Now, if the seller is unable to meet the repair requirements in the contract, sums equal to 125% of the repairs, replacements, treatments or permitting (not in excess of applicable repair limits) shall be escrowed at closing. Any unused portion of the escrow will be returned to the seller.

Appraisals: Recourse for if the property does not appraise. New: If the appraisal of the property obtained by buyer's lender is insufficient to meet the terms of the loan commitment the escrow is returned to the buyer.

Inspections:  Inspections will be done by a person who specializes in and holds an occupational license to conduct home inspections or who holds a Florida lIcense to repair and maintain the items inspected. New: any inspections must be done by a licensed person.

Later in the week I will address the changes to the "Short Sa;e" addendum and review the short sale process.