FAR/BAR Contract Updates
The Florida Bar and the Florida Association of Realtors® established a Realtor®-Attorney Joint Committee in 1973, comprised of 10 attorneys and 10 Realtors® appointed by their respective organizations. The FAR/BAR Residential Contract for Sale and Purchase and Comprehensive Riders (collectively, the “Contract”) was created by the committee and, according the Florida Supreme Court, use of the FAR/BAR Contract and Riders allows real estate licensees to avoid the unauthorized practice of law by simply filling in the blanks. Keyes Co. v. Dade County Bar Ass’n., 46 So.2d 605 (Fla. 1950).
The Realtor®-Attorney Joint Committee reviews the Contract every two or three years, and makes updates or revisions based on input from the respective organizations. The Contract was recently revised, and the changes accepted in August 2013. Below are some, although not all, of the changes – the most obvious change is that the Contract is now 12 instead of 10 pages.
Paragraph 2(a) has been changed to remove the option of providing the deposit upon acceptance of the Contract. Now, the deposit is due together with the offer, or within a certain number of days of the effective date – 3 days if left blank.
New Paragraph 6(b) indicates whether the property is, has or will be leased. If there is a written lease, it must be given to the Buyer within 5 days of the effective date of the Contract, rather than within 5 days of inspections. If there is a verbal lease, the terms of the lease must be provided to the Buyer within the same timeframe. The Buyer then has a specified amount of time to cancel the Contract if the lease terms are unacceptable. Similarly, Standard D (paragraph 18) now requires lease estoppel information to be provided to the Buyer at least 10 days prior to Closing (previous versions of the Contract had a 5-day time period).
The Financing paragraph, number 8, creates another check-box for “other” loan – which may include a 203(k), USDA, or other type of loan. In addition, the Buyer may cancel the Contract within 7 days prior to the Closing Date if the Buyer has failed to obtain financing.
Paragraph 10(d) now includes a blank, defaulting to 20 days, within which the Buyer can cancel the Contract based on the Flood Zone certification. The disclosure also includes language addressing the controversial National Flood Insurance Reform Act of 2012 (the Biggert-Waters Act of 2012), regarding the phase-in of actuarial ratings based on the pre-Flood Insurance Rate Map.
Previous versions of Paragraph 12(b)(i) regarding inspections, did not allow the Seller to obtain relevant portions of the Buyer’s inspection report regarding repairs. The new version of the Contract allows the Seller to request, in writing, a copy of the portion of the Professional Inspector’s written report dealing with such repair items.
Although time periods are calculated in calendar days, typically any time period that ends on a weekend or holiday is extended to the next business day. The new Standard F, Time, continues this date calculation except for the time period for acceptance and Effective Date. Both of these dates may end on a weekend or holiday.
Standard T, Loan Commitment, narrows the definition of a “Loan Commitment” letter to specifically exclude a pre-approval letter or pre-qualification letter.
So far, the changes discussed have been application to both the Residential Contract for Sale and Purchase, and the “As-Is” Residential Contract for Sale and Purchase (“As-Is Contract”). However, Paragraph 12 of the As-Is Contract is slightly different and had its own changes. The paragraph was changed to make date calculations easier. The number of days for the inspection is now “after” the Effective Date instead of “from” the Effective Date. In addition, the word “immediately” has been removed from the language requiring the return of the deposit to a Buyer who cancels based on the inspections.
In addition, the As-Is Contract, Standard X was changed to provide that the waiver of claims by Buyer only applies to physical defects or the physical condition of the property, rather than title defects. The paragraph also makes clear that the Seller’s obligations under Paragraph 10(j), Sellers Disclosure, remain and are unaffected by Standard X. Finally, the provisions of Standard X survive closing.
There were other changes left out of this discussion due to space constraints, including changes to some of the Riders. Yesner Law does have the most current version of the FAR/BAR Contract, and there are a variety of vendors who will provide all of the forms for an affordable subscription price. Contact us and we will send you the information for the vendor who provides us with our documents.
– Shawn M. Yesner, Esq.
For more information on Buying or Selling a home, the FAR/BAR Contract, Leases, Lease Options, and other contract issues, or to schedule a free initial consultation to discuss your options, please contact our firm at: 727-261-0224 or email me at: firstname.lastname@example.org.
Shawn M. Yesner, Esq., is the founder of Yesner Law, P.L., a Tampa-based boutique real estate law firm that helps clients eliminate debt by providing options, so they can live the lifestyle of their dreams. We assist clients with Real Estate contract issues, foreclosure defense, debt settlement, Chapter 7, Chapter 13, bankruptcy, liquidation, reorganization, short sales, and loan modifications, for clients in Westchase, Carrolwood, Tampa, Odessa, St. Petersburg, St. Petersburg Beach, Treasure Island, Medeira Beach, Reddington Beach, Kenneth City, Gulfport, Pinellas Park, Seminole, Clearwater, Clearwater Beach, Oldsmar, Dunedin, Safety Harbor, Palm Harbor, Lutz, Wesley Chapel, New Port Richey, Trinity, Port Richey, and other areas that comprise the greater Tampa Bay area.