How many days does a real estate broker have to return the escrow after a deal falls through? Well, the practice or what transpires is there’s no particular time line. If a deal collapses, then the broker routinely obtains a escrow release. Many brokers don’t even hold the deposit but they ask both the buyer and the seller to sign a release that says who receives the deposit. So if the deal falls through because of financing and you’re within the time period for the buyer to get financing and they give notice that t hey did not obtain financing and they want their deposit back, they routinely make a demand upon whoever’s holding the escrow to return it.
The real estate brokerage would then prepare a form that authorizes the escrow money to be released to the buyer borrower, and ask that the seller sign it and the buyer sign it and the realtor sign it, all releasing any rights they have to the deposit. Until that is done, well the escrow does not get released. If you have a seller that won’t sign it, well it creates a problem. If they make a demand upon the deposit, well the deposit doesn’t get released and certainly the buyer gets frustrated as far as that’s concerned.
My suggestion is if you believe that a seller is not releasing your deposit after you have a good reason to cancel the contract, I advise the folks to file an action in Small Claims Court if the deposit’s less than $5,000, and ask the court to reward them their money back under the terms of the contract. There’s no set time period. The escrow agent and the broker are going to ask the parties to sign a release and if that doesn’t happen on a timely fashion, then I believe that a broker does have a time period, which I can’t give you, to submit this to the Florida Real Estate Commission as far as to whom they should release the money when there is a dispute.
I don’t have an answer as far as that’s concerned on how many days they have before they send it to the Florida Real Estate Commission and ask them to make a determination as to who they should release the money to. If you have any questions, you can give me a call at 727-847-2288.
How do I add my spouse to the deed on my property? Well, it’s fairly easy in that you simply sign a new deed and you can bay the property to you and your spouse. Which brings us to, what does that accomplish legally? It creates what they call a tenancy by the entireties which is a biblical concept that’s been carried over from the English common law into the Florida law and it is Florida specific as to how it’s treated, although there are seven other states I think that recognize tenancy by the entireties. The bible says that when you become married, when you’re married you become as one and that’s the concept of tenancy by the entireties. That gives you the right of survivorship. In Florida in particular, it also is a simple way to have some asset protection so that if anyone would get a judgment just against one spouse, they cannot attach the property that is held as tenancy by the entireties.
Most property that is held by husband and wife, that creates a tenancy by the entireties whenever you show you’re married as husband and wife. That protects a real property held that way. What a lot of folks don’t know about is that you can also set your bank accounts up in that same manner, but you need to ask the bank on the signature card do they offer tenants by the entireties accounts? If they do you need to be sure to check that box rather than joint tenants with right of survivorship.
Joint tenants with right of survivorship means that each of you own a one half interest in the property and it can be attached. By going back to the simple question is how do I add my spouse to the deed to my property is you simply sign a new deed. One pitfall, or an unattended consequence of doing that is if you have a mortgage on the property, unfortunately the Department of Revenue at this point requires you to pay documentary stamps at $7 per thousand based upon one half of the mortgage amount. There is going to be some proposed legislation which allows you to waive that, but right now that’s not what the law is and so whenever you do that, the cost of the deed is relatively a few hundred dollars. However, if there’s a mortgage on it that can cost you a substantial amount depending on the amount of your mortgage.
If you’d like to add your spouse to the title of the property and put it in your name as husband and wife, which I would recommend, give me a call at 727-847-2288.
What does a title company do? Well, a title company issues title insurance. In incident to or as a result of issuing title insurance they must prepare all the necessary documents to convey title. Title insurance is where the title has been examined by looking at the records, and then once they’ve examined it they determine if there’s any liens or any encumbrances such as easements, or restrictions, or judgments. Most people are very concerned about getting a clear title. Clear title means, to most people, that there are no judgment liens against the property or other kinds of liens.
The title company, through their underwriter, has the title examined. Once they have the title examined they issue what they call a title commitment. It says that we will insure the title to so and so, which is usually someone who is buying the property under a contract. If Mr. and Mrs. Jones are buying a piece of property or have a contract to purchase it for say $100,000, the title commitment would read, “To John Jones and Mary Jones.” It would show that it would be issued for $100,000. It would commit to issue a title insurance policy free of any particular liens against the property. The first page would indicate the amount and then they would show the legal description. The second page is called Schedule B1 on the commitment. It would outline what would be necessary in order to have the title insurance issued. First off it would say that you got to pay the money. Secondly it’s going to say that you need a deed from the present owner to whoever is purchasing it, to Mr. and Mrs. Jones.
Then the other requirements may require that the existing mortgage be paid off out of the, from the closing before they could issue a title policy. It would also say that we may need to give them an [Estopple 00:02:26], or a statement from a Homeowner’s Association or Associations to see if there’s any unpaid Association dues. If there’s any judgments outstanding they would say that these judgments need to be paid for us to issue a title policy. If the property is in the name of a descendant, the title commitment under Schedule B1 would call for a probate proceeding. Schedule B1 are all the requirements that must be fulfilled in order to issue a title policy.
Then you turn to Schedule B2. That’s a schedule of encumbrances that you will receive the policy, such as various restrictive covenants, particularly if you’re buying a condominium and will have the entire condominium. If you’re buying through a Homeowner’s Association it’ll say what the restrictive covenants are and reference them as where they’re recorded in the public records. Usually a closing, as far as a residential closing, where someone’s buying a house, they’ll delete what they call Tute Standard Exceptions. One is rights of claims of parties in possession because the buyers will be getting the keys at closing. The other one that is deleted often is if you delete the unrecorded liens. In Florida, anybody provides material or services to a particular property has 90 days in which to file their claim of lien. It will insure against unrecorded liens that have occurred in the last 90 days.
Once all the requirements have been satisfied and everything’s been signed, the title company then takes the money from the closing that they get from the buyer, then they pay off the mortgages, they pay whatever they need to to satisfy all the requirements under schedule B1 of the title insurance. Then they will issue the title policy. The title policy then insures the buyer, Mr. and Mrs. Jones who purchased the property, that they have what they call “marketable title” to the property, meaning that there are no outstanding liens against the property or there’s no encumbrances, or easements, or restrictions unless they were shown in the schedule which was referred to in the commitment as Schedule B2.
What does a title company do? A title company issues title insurance. They usually also, are usually the closing agent, meaning that they’re the ones that handle the money and prepare all the documents necessary in order to have the title insured. They’re authorized to do that. I’m a title agent. I’m an attorney title agent, so I issue title insurance. If you come to my closing in my office, and I try to be at the closings, I try and explain any of the exceptions, or try and talk to you about your title insurance policy and show exactly what the exceptions are such as restrictive covenants. If you’re selling your real estate, and I compete with other title companies as far as price is concerned, and believe that we provide good quality service, timely service, and you also get the benefit of me throwing [kabitzing 00:06:10] as far as what the law is, or explaining certain things at the closing table.
If you sell your property and you need a title agent, or you want me to close a transaction, you merely need to tell your realtor that you would like to see how much it would cost for the Law Office of Waller and Mitchell to be your title insurance agent, and close your transaction. You don’t necessarily need to pay me an attorney fee, but I’ll just close the transaction as a title agent and closing agent for the title insurance premium. When you sell your house, well give me a call at 727-847-2288 and I’ll be glad to write the title insurance for you, and also answer any questions. Thank you for calling.
What is title insurance and why is it necessary? Title insurance is an insurance policy that ensures that you have marketable title to the property. Like any good insurance policy, it shows the amount of coverage that you have, so if you have a complete title failure or partial title failure, it’ll pay up to the dollar amount that’s shown on schedule A of your title insurance policy.
It also tells you the title to the property and has the legal description of the property on schedule A. There is a schedule B that says that there are certain matters that they don’t insure against which are called exceptions. Some of these exceptions reference such as easements, restrictive covenants, and conditions, those are just a few examples, which are usually acceptable to a buyer. What you need to be concerned about on your Schedule B of your title policy, is if there is a judgement or some sort of lien that’s shown in that, which you’re not insuring against.
That’s what title insurance does. It insures that you have marketable title, and if you’re notified that there is a lien against your property or another problem with the title, that you have someone to look at. The big reason why title insurance is necessary is more for preventative measure than it is a remedial measure. That then, you have someone who has examined the title to check to see if there’s any particular liens against the property, and so they are confident or have examined the title, and therefore will insure it, so that they, as they say, put their money where their mouth is, or the insurance policy itself.
Whenever you make a substantial investment, of hundreds of thousands of dollars, or one of the largest investments that you make, you’re usually not talking about a few hundred dollars, you’re talking about thousands of dollars. It would only be appropriate that you make sure that you know what you’re getting, and have the title searched, and have a title policy. This, in the Tampa Bay area, whenever you purchase real estate, the seller is usually the one that is responsible for paying the title insurance, that’s primary practice, and that’s shown in the real estate contracts, as to who is to pay for the title insurance.
If you go down to Miami and Broward county, and those counties, there the borrower is the one that’s responsible for paying the title insurance. It varies throughout the state as who’s responsible, and is controlled by contract. There’s also an aspect of it is that if you have … if the seller is paying for owner’s policy, and the buyer is getting a mortgage, the buyer can obtain what they call a simultaneous issue rate, to ensure your lender that the lender’s getting a first lien on the title, and that there’s no junior liens. The title insurance is important to the lending community, to make sure that they have first liens, and not just rely on an attorney’s opinion or an ownership and encumbered search, an attorney’s opinion, because, let’s say that the lawyer missed something or the title company or whoever issues the ownership and encumbered search missed something. Who they going to hold responsible? Go back to the lawyer, does the lawyer have the ability to pay the money, is he still in business, has he died or whatever. Therefore, we have the advent of title insurance, which has been around for longer than I’ve been … I’m not sure just how long, but it’s been here a long time, 50, 60, 70 years.
You have any number of major title insurance underwriters. It’s primarily preventative, because you do thousands of transactions and the property sells and resells and there’s no title problems, but you’re checking on them, such as code enforcement liens, should show up on a title search, and that way you take care of it before you take title. Otherwise, if you just take a deed to the property and trust the seller that he says, “Oh, no, I don’t have any liens against it.” Later on, you find out, what are you going to do about it? That’s the reason why you want to have title insurance and hopefully give you some idea of what title insurance does.
If you have any questions, or more importantly, if you like for me to write some title insurance or write a contract and write the title insurance policy, I’ll be happy to do so, give me a call at 727-847-2288.
Can a buyer sue a seller for a undisclosed roof leak?
The answer is: yes, they can. This dates back to a Florida Supreme Court case called Johnson vs. Davis. That decision is probably 20 years old or older wherein they held that any residential transaction that the seller has the duty to disclose to the buyer any matters that are not reasonably observable to the buyer that may have some impact on the value of the property.
So, as a result of that, the standard real estate contract that is used by realtors that’s been approved by the Florida Realtors and the Florida Bar Association has a clause in it that says that the seller has disclosed any matters that may material affect the value of the property that are not readily observable.
Further, if you use a realtor they have a seller disclosure form wherein they go through a series of about four or five pages asking the seller to initial one way or the other whether there’s been any problems.
So, if you didn’t have that in the contract and you simply used a contract that did not have a disclosure or an as is contract, the seller still has the duty to disclose any matters that are not readily observable that may have some impact on the value of the property.
If a buyer’s going to sue the seller then they must review the disclosures to see if the seller did in fact disclose the roof leak or any other leak.
Secondly, the buyer must prove that the seller knew of the roof leak because you’d have to show that it occurred or was a roof leak prior to the purchase rather than occurring later. There have been some cases whenever people weren’t aware of a particular defect – of course it’s a little harder as far a roof leak’s concerned, but as far as any defect is concerned that they’re aware of it.
Many times if you buy bank owned property the bank will put on there that they have no responsibility because they’ve never been in possession of the property and therefore are unaware of any defects and so you could not sue a seller that is not aware of these problems.
A roof leak usually is manifest by showing something on the interior where the ceiling has been discolored and you can show where the seller has painted over it or has had roofers or somebody else over there trying to fix it and so that you could show that they were aware that the roof was leaking and they failed to disclose it.
If they fill out the form that the realtor gives them and says that they haven’t had any prior roof leaks or any other problems with the property, that’s an affirmative fraud and that is another cause of action so that you can sue the seller on two different theories as far as failure to disclose a hidden defect that’s called a latent defect – either sue under the contract if it’s provided for in the standard bar contract or the realtor bar contract or as a in toward or liability.
It’s a form of fraud by not disclosing this matter and so the other aspect of this before you get ready to sue the seller, you need to see who the seller is. If you happened to have bought this property from an investor or an LLC, well you may be able to sue them, but you have to show they knew about it, covered it up and didn’t disclose it and also, can you get any money back out of it?
So, you have two remedies. One is to ask to rescind the transaction, meaning you give them back the property and you get your money back if you were would not have bought it if you were aware of it. The other one is to sue for damages to determine or you show how much it cost to fix the defect.
So, an answer to your question is: yes, you can sue – a buyer can sue a seller for a roof leak if they can show the seller was aware of it and the roof leak occurred prior to them purchasing the property.
If you have any questions about this, well give me a call at 727-847-2288.