The Florida legislature finished its 2011 session last week. In the previous article Florida legislative wrap up for the 2011 real estate industry - Part 1, we discussed the various property tax and other business taxes that were changed during the session. This next article we will discuss the remainder of the important changes affecting the real estate industry.
Sweeping changes were passed in Florida's struggling homeowner's insurance marketplace. The main bill that passed was SB 408. The supposed goals of this bill is to reduce premiums for homeowners and to reduce the role of the state owned insurer, Citizens Property Insurance Corporation. The insurance industry was pushing to exclude sinkhole coverage altogether due to supposed fraud and massive payouts in recent years. The insurance industry did not get that provision but did get the following provisions: (1) Garages, pools, and other detached structures can be excluded from sinkhole coverage. The actual home cannot be excluded. (2) Insurers can pay the actual cash value upfront as opposed to replacement cost. Replacement cost would only be required to be paid after repairs have actually been made. This will make it harder for people to simply take a huge check and then instead of making repairs, simply sell cheap and walk away. (3) Sinkhole claims must be filed within 2 years of the event. Hurricane claims must be filed within 3 years.
Title insurance protections were also passed for consumers via HB 1007. This provides additional coverage for consumers even if the title insurer ends up going insolvent and is liquidated by the state's Office of Financial Services. An additional title surcharge of $25 will be charged.
One of Governor Scott's campaign items was loosening up growth management laws . HB 7129 which takes more burden off of the State of Florida and puts it onto the local governments that are more in the trenches with local development options. This bill also prohibits local governments from enacting their own versions of last year's Amendment 4 a/k/a Hometown Democracy which was voted down by the people of Florida last November.
Technical changes were made to last year's big condo law in HB 1195. Besides some building code changes regarding fire alarms and windows, some clarifications were made regarding communications with resident tenants that occupy units whose owners are delinquent in paying their assessments.
Tighter restrictions were passed for people making adverse possession claims in SB 1142. This bill makes extensive changes to the once liberal adverse possession laws by requiring special notices to be provided to the property appraiser. This bill also makes it much easier for the record owner to reclaim their property. This bill is in response to several "scam artists" who were breaking into vacant homes and basically trespassing simply because the home appeared to be abandoned.
Technical changes were made to the 2009 mortgage broker and short sale laws that overhauled Chapter 494, Florida Statutes. These changes are in SB 1316 . Many of the changes bring the Florida law more in line with the federal SAFE Mortgage Act. Additionally, real estate sales associates and brokers are now exempt from needing a loan originator license (f/k/a mortgage broker license) in order to negotiate short sales and similar transactions as long as they are not being paid directly by a lender or loan originator. Great news for so many Florida real estate agents. Here is the exact language which will become an exemption under FS 494.00115(1)(f): A person who performs only real estate brokerage activities and is licensed or registered in this state under part I of chapter 475, unless the person is compensated by a
lender, a mortgage broker, or other loan originator or by an agent of such lender, mortgage broker, or other loan originator. The term "real estate brokerage activity" has the same meaning as in the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008. (The definition of "real estate brokerage activity" in the SAFE Mortgage Act can be found at this link on page 4, paragraph D at the top of the page.)
Some of the bills that failed to pass included repeal of septic tank inspections, non-judicial foreclosures, property tax exemptions for low income seniors, and a bunch of insurance overhaul bills. Please keep in mind that all of the bills that passed are still subject to the governor signing or vetoing them.
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