Real Estate Archives - The Orlando Law Group

The Tidal Wave of Evictions Begins to Break

All posts, Coronavirus, COVID-19, Personal, Real Estate

With COVID-19, there has been a blanketed feeling of stress brought about by financial strife. Many individuals and businesses are struggling to make their normal payments. This has caused all eyes to stay locked on the monthly moratorium that keeps getting extended every month. This acted as a barrier for many, but also increased the unknown moment of when we would begin to see the ripple effects brought about by a fractured market. We may be at the beginning of the tidal wave of evictions.

What makes the latest Moratorium different?

In the latest extension, which brings the new date to September 1^st, new language seems to allow eviction filings to resume. It may even allow for some residents to be removed from their living conditions. The statewide moratorium that was put into place before encompassed more protection for renters, suspending, “any statute providing for an eviction cause of action.” Even though the interpretation of that statement was thought to prohibit landlords from filing, many began the process anyway. A staggering statistic: about 400 commercial and residential evictions have been filed in Orange County as of this time. In terms of what exactly the newest extension suspends, it only halts the “final action at the conclusion of an eviction proceeding” and only for tenants who have been “adversely affected by the COVID-19 emergency.”

It seems that language may open the floodgates, and we may begin to see the onslaught of evictions begin to move forward. A standard amount for Orange County is 1,000 evictions filed every month. With the amount that has built up, we could see at least 5,000 cases filed.

Why is Central Florida vulnerable?

Central Florida is particularly a vulnerable location, being that it relies heavily on the tourism industry. Homelessness, industries on the brink of shutting down, and a wave of restaurants closing permanently are all a part of the predictions being placed at this time. With the language of the new moratorium, landlords will see much more success with their filings. Not only this, but the fact that so many tenants, who are accustomed to the moratorium being unaltered, will not realize the differences and when they are summoned to court may chose to ignore it. If so, this could result in them having five days to reply. If they do not, they could lose their case and automatically be kicked out.

Many have faulted the fact that this extension has been put forward without more clarity on how it differs from the ones that have come before it. Not only was this placed days before the prior moratorium was set to expire, it also came without comment or clarity from the governor. It was not until later that he stated that the order would only effect those who have not been financially impacted by the pandemic.

Caught between difficult dilemmas, the change was implemented to help give landlords and property management companies assistance when their tenants refuse to pay. Sifting through those who have been affected by the pandemic and those who have not may be a tough task. In June alone, 1.02 million Florida residents were still without work. This is a frightening figure, and one that indicates that Florida will be heavily impacted economically for some time.

A Truly Difficult Dilemma to Solve

Even still, the waters are made murky by those who would take advantage on the pause in evictions. For the month of June, property management executives as well as mom-and-pop landlords wrote the Orange County Commission stating that some tenants are using the situation as an excuse to not pay. Chip Tatum, CEO of the Apartment Association of Greater Orlando, mentioned that 65% of its members have been in negotiation to pay, while about 27% have been unresponsive or unwilling to work towards a plan.

For the eviction process, normally a three-day notice is taped on the tenant’s front door. If the tenant does not comply within that time, the landlord may file a complaint with the court, in which case the tenant will be served a summons. To get a hearing, the tenant would normally have five days to deposit the owed rent into the court registry. One of the defenses that tenants may utilize revolves around paying this court registry. If a tenant was adversely affected by the pandemic, they may not have to pay this fee. If a tenant can illustrate loss of employment, diminished wages, business income or other monetary loss, then this could work in favor for the tenant. Saving emails from your supervisor, pay stubs or any evidence of collecting unemployment compensation may be helpful, even though unemployment compensation may indicate a tenant’s ability to pay rent.

The lasting Repercussions

Even if the tenant’s case is dismissed, they will still have an eviction filing on their record, which could make funding for housing in the future very difficult. Orange County is working hard to create a diversion program to stave off the tidal wave of evictions, and Mayor Jerry Demings said that a plan is set to be presented to commissioners on Tuesday, August 11^th. No details on how the plan will work were given, but in the meantime, landlords and tenants will have to survive in a situation that excludes easy answers. Our recommendation is that you have a plan, and paperwork to provide legal foundation for your plan. When hardship arises and you feel you have been treated unfairly, our lawyers will be there to help.

August 10, 2020/by The Orlando Law Group

Emotional Support Animals & Community Association Rules: What Does the Law Say?

All posts, Blog, Condominium Owners Association (COA), Home Owners Associations (HOA), Real Estate

Many Community Associations adopt rules and restrictions to limit pets within a community. When purchasing a home, this can be especially appealing to those who suffer from allergies, those that have animal phobias, or those who just simply dislike animals in general because of the noise they make or the mess they sometimes leave behind.

However, it has been well established that service animals, “trained to do the work or perform a task for an individual with a disability, whether physical, sensory, intellectual, or other,” cannot be kept out of a community based on a Community Association’s “pet restriction policy.” This is because the Fair Housing Act, which was adopted in 1968, was modified in 1988 to include persons with disabilities as a protected class. In summation, the Act states that no person can discriminate against another with a disability when renting, buying, or selling a house. Since the service animal is an accommodation for the disability, not allowing the animal would be considered discrimination. Also, since the Fair Housing Act is a federal law, this law supersedes any rules and regulations or any restriction within the declaration of the Association.

THE DIFFERENCE BETWEEN A SERVICE ANIMAL AND AN EMOTIONAL SUPPORT ANIMAL

The next question to consider is if there is a difference between a service animal and an emotional support animal. The answer is yes! Service animals require a high level of training and are typically trained to provide specific tasks for their owner. Emotional support animals on the other hand do not require any specific training. Their sole purpose is to provide, as their title suggest, “emotional support.” Service animals are easy to identify as they tend to be dogs and perform very specific tasks such as seeing eye dogs that provide guidance for the blind. However, with emotional support animals, Community Associations continue to see an increasing number of owners who claim to need emotional support animals with no outward demonstration of a need for support nor the animals demonstration of anything other than being a household pet.

This has left most Associations asking the quintessential question, “what criteria do we use to validate any claim from an owner as to the need for an emotional support animal or animals in some cases?” This is a difficult question to answer and has become a much-abused provision of the law in recent times.

THE AMERICANS WITH DISABILITIES ACT

But we are not without any legal support. The law does provide Associations with some guidance. The Americans with Disabilities Act limits support animals to dogs and miniature horses. The law also imposes penalties for false claims, although we do warn Associations that it is very difficult to prove such a claim. Associations can also require supporting documentation from an authorized physician or therapist stating the need for the animal. The law protects an individual’s right to privacy as to their specific disability but does not prevent an Association’s right to request proof of the need for an emotional support animal or the need for multiple animals if the case presents itself. The Association can also adopt reasonable rules that the owners must follow so that these animals do not interfere with the peaceable enjoyment of the community by the rest of the residents. For example, one such rule could include that all emotional support animals must always be on a leash when outside an owner’s residence or fenced in yard. Another rule could be that all owners are responsible for picking up after their animals and properly discarding all animal waste.

NAVIGATING THE FINE LINE

There is no denying that animals definitely provide therapeutic healing for those who need it. However, more often than not, we have seen many owners try to get their pets into communities that have “no pet” polices under the guise of them not being a pets but rather emotional support animal with a certificates printed off the internet. This has, in turn, created a very negative connotation and atmosphere surrounding emotional support animals.

As a community, we cannot let the selfish acts of some affect the true medial needs of others. So, Associations can arm themselves by knowing the laws regarding emotional support animals, require owners to provide proper documentation and implementing reasonable rules and regulations for emotional support animals within your community. This will allow those who truly need the support of a fury friend to receive the aid they need and hopefully deter others from violating the laws and instead choose to live in a pet friendly community instead.

July 24, 2020/by The Orlando Law Group

You Should Never Make These Real Estate Mistakes

All posts, Business Law, COVID-19, Real Estate

The Real Estate industry is filled with victories, losses, and mistakes. The fact that there are so many Realtors and so much business being conducted means that there is a high propensity for ingenuity as well as massive opportunities for pitfalls. You may have passed the Real Estate exam, and you may have a handful of experience on your resume, but that does not mean you have experienced it all. That does not mean that you are infallible. Whether you’re a Realtor working in the industry for the first time helping someone sell their home and upgrade or a seasoned investor looking to gain your next big investment property, these are great reminders of what not to do.

Over the years, many real estate and small business owners across the U.S. have witnessed numerous mistakes that have cost them thousands of dollars in overpaid taxes. We at The Orlando Law Group do not want that to be you (if it ever is call us). We want you to have a deep understanding of the mistakes people make before you must litigate. If you are looking to invest or simply finding ways to run your business like a business, never make these Real Estate mistakes:

Personal funds used for business and real estate expenses are nondeductible

If you are going to use your own personal funds to pay for real estate or business-related expenses, it is important that you are clearly tracking the expenses. Any expenses that are incurred for the business or for real estate are generally deductible, even if you use your personal money. The line between the two should be quite bold, and there should be distinct differences between personal finances and business finances. We have all heard of

Overpaying (Tipping) the IRS will make me “Audit Proof”

Rather than go over, or under, when dealing with taxes it is best to get it right. Err on the safe side and always pay exactly what you owe to the IRS. If you constantly under pay your taxes or cannot substantiate your deductions, then the IRS starts to take notice.

Even if you tip the IRS in one area, it does not necessarily mean the IRS will not make you pay penalties if you underpay in another area. Additionally, it is important for you to make sure to track everything correctly and have the right documentation. To ensure this, it would be best to have a knowledgeable tax advisor to help you with the process.

You are allowed more deductions by being incorporated

If you have a legal entity to operate your real estate business from, make sure to use it correctly. Forming a legal entity does not actually mean that you get more tax deduction. Real estate or business-related expenses may be deductible regardless of where it is paid from. Make sure that your income is being paid to your legal entity. If you need help setting one of these up, we are here to assist you. So many individuals think that they can run a business without being incorporated, but there are real advantages to going through the necessary steps. We can show you how.

Utilizing the Home Office Deduction Incorrectly

Currently, the above statement no longer applies. In fact, since there are so many people that work from home, the IRS cannot audit all tax returns claiming home office deduction. The key is to keep excellent records to satisfy the IRS’s requirements and you should avoid an audit. Make sure to benefit from the home office deduction, and if you have any questions about grey areas, reach out to us. We have worked with many individuals who run their business from a home office, some for many years of their life.

Claiming Deductions That Are Out of the Scope of Your Business

There are still ways to claim many deductions from your real estate business even if you do not take the home office deduction. Some of the items that you can still take deductions for include: real estate maintenance supplies, business-related phone bills, travel expenses, wages paid to contract workers for property improvements, depreciation of equipment used, and other home-based related expenses. Claiming items on your deductions can sometimes be treated like an art rather than a science. We recommend having a scientific, consistent, and tested approach. Never make assumptions by yourself, and include others’ perspectives to make sure you’re claiming the right items.

Filing an extension gives you an extension to pay any taxes owed

Even though filing an extension allows you to extend the filing date of your tax return, it does not extend the time you have to pay the taxes that are due. You still might be charged penalties and interests from the date your taxes are due if you have not submitted them on time. Make sure you set a schedule and keep to that schedule. If you need to, set reminders. Have business partners hold you accountable, and do not let taxes owed build up over time.

You Cannot Deduct General Expenses

Real estate investors have proven to be great at deducting property specific expenses such as mortgage interests, management fees, property taxes, and insurance. However, a lot of investors miss out on general and overhead expenses that real estate businesses have. These include car or travel expenses, marketing expenses, cell phones, and meals. If these expenses are directly related to your business, then they can be deducted. The key is having them planned and managed. With a good budget and great records, you will be able to successfully communicate where your business falls in terms of deductions.

Everyone is used to filing taxes every year, but big businesses try to look at their expenses quarterly. Attaining tracking practices that will maintain good habits and records is vital to understanding what occurs financially over time. Without systems and processes that you hold onto, it becomes easy to have details fall through the cracks.

We at The Orlando Law Group want you to stay aware of the mistakes that others often make. They may seem simple, but when you are running your business, it is easy to get lost in the day-to-day tasks and forget about these overarching items. As always, when there are grey areas involved, it is best to consult a legal professional. We take taxes seriously, and so will the government. We have seen cases where, if the business had been more preemptive and planned better, they would not be in the middle of an audit. This is only meant to encourage you to have a plan, know the pitfalls, and when you need advice, call us. We want to help, and we are here to make your life easier and your business that much better.

July 17, 2020/by The Orlando Law Group

Commercial Leases: What You Need to Know Right Now

All posts, Business Law, COVID-19, Real Estate

Courts have been slow to reopen and deal with eviction issues. Commercial lease evictions are able to continue, but practically they will still take time to get through the courts, so now is the time to try to work things out if possible to save time, money, and stress. Some considerations to think about with your commercial lease are as follows:

Considering How Shopping Center Commercial Leases are Unique

The fact that shopping center leases have co-tenancy provisions makes them unique and could grant tenants more options in court. The goal of this co-tenancy is to ensure that stores do not miss out on opportunities because other stores are closing and causing a continual downswing in foot traffic. In terms of the battle between landlords and tenants, tenants may have a potential argument that the landlord has not fulfilled its co-tenancy obligation.

It is important to note that one of the factors that many tenants’ arguments will stand upon is whether COVID-19 indeed prevented them from paying their rent. One of the considerations that many landlords are taking is the potential to fill the spot that would be left vacant.

Factors that will affect such decisions include supply and demand as well as how desirable the location is. It may even be more advantageous for landlords to settle disputes out of court, but we are certain once the moratoriums subside, the courts will see an influx.

What Exactly Is Co-tenancy and How Could It Apply?

When more than one entity has an interest in a property, co-tenancy agreements usually apply. In commercial property, many times increased traffic will cause businesses to be more successful over time. The inverse is true as well, with businesses that are forced to shut down causing damage to the potential of the stores that are left.

Many times, to assist with the finances of these stores, landlords will lessen the rent of the co-tenants. It is all up to the landlord and the documents that the businesses signed when they first decided to become situated in that location.

Complicating matters more is the fact that PPP Assistance may give a business the appearance of operating at a standard level when foot traffic is drastically lowered because of rising positive COVID-19 tests.

With a lack of pandemic provisions written into leases, landlords and tenants are having to get creative with the options that they are afforded. Co-tenancy has often been used to help businesses that are suffering due to the lack of success from an adjacent commercial listing.

However, what happens when an external factor is causing many of the businesses to suffer? It may just be that a battle is looming on the horizon between landlords and tenants, and every month we get a little bit closer to that battle becoming our reality.

What Options do Landlords Have?

Although landlords are in a predicament when it comes to shouldering tenants that are not paying rent, there are many points to take into consideration before filing for eviction.

For the high-end shopping centers, they may have the footing to stand on, mainly because filling the empty location will not be as difficult. For areas with less foot-traffic, landlords may be encouraged to work with their tenants.

Depending on the language found in the contracts signed between the owner and the occupant, some owners have been able to offer concessions to assist their tenants during this time; however, many are not going to be able to make such offerings.

Some have speculated that eventually, owners may turn to lenders to try and gain permission to offer concessions. The fact remains that all three parties are in a mode of cautious speculation over what options they may have to maintain some semblance of the bottom line when it comes to their businesses.

Although insurance does not usually cover pandemics, that could change down the line. Lenders are looking at options that involve insurance that would help landlords and, in turn, help their tenants through difficulties that are out of their control, such as a pandemic.

An important factor is assistance afforded by the PPP loans from the Cares Act. Even with an extension and another assistance check, the potential ending point could be early August when the program is set to expire.

We could be looking at many agreements being modified and tensions rising between landlords and their tenants as that time approaches. Once the PPP loans expire, we will be seeing an entirely different operating pattern for landlords and the businesses they rent to. That dreaded conflict could create many vacancies and fluctuations in the commercial market. We must be ready.

A Wave of Litigation on The Horizon

We believe that, although you can stave off conflict, many times it is only buying time that will eventually run out. With difficulties being placed on both sides, we certainly predict a wave of litigation concerning these issues.

Our recommendation is to cross these bridges before they are at your feet. One of the best practices you can have with the businesses you work with is to have open lines of communication. Of course, when relationships become too contentious to resolve certain complications, it becomes necessary to have a legal professional help.

Being situated where we are, The Orlando Law Group is keeping our focus on what we can do to help commercial businesses and their landlords through this difficult time. It could be the simple act of looking at your documents to have a deeper understanding of the potential you will have when facing mounting litigation.

When there is no easy answer, the law is there for us to rely upon, and we are remaining cautiously hopeful for the future. Businesses will have to adapt as well as their landlords, and as we go through this change, we will find new ways to protect the financial future of our endeavors.

July 8, 2020/by The Orlando Law Group

Unbreakable Lease: Orlando Student Files Lawsuit for Refund

All posts, COVID-19, Real Estate

With what has been going on in our world lately, our daily lives have been interrupted in ways we cannot underestimate. One industry that has been affected is college living. With colleges moving towards virtual learning to stay healthy and cautious, students have been forced to leave their dorms and suddenly break their agreements.

Trapped in an Unbreakable Lease

Imagine being trapped in a rental agreement that you could not break with the stress of a semester upended. That is the reality that many students face, and they are beginning to file lawsuits to fight back.

Right down the street from The Orlando Law Group Waterford Lakes office near the University of Central Florida, a class action suit has been filed against a Georgia-based, off-campus apartment operator. Incongruent to what the University has accomplished (they refunded housing money for university-run dormitories), Preferred Apartment Communities Inc. had failed to refund rent paid by students who returned home when campuses closed the middle of March.

Those students are paying monthly rent for a location they are not living in, and for those who have lived near campus, they will attest to the fact that those payments are not low.

They are not alone

In Colorado, students are suing their University for fees that cover services they are no longer receiving due to the pandemic, which has paused on many parts of the campus.

Many of these dues account for the student recreation center, transportation, sports events, and the performing arts center. A local attorney representing the students highlighted the fact that colleges should be held to the standard of any other business. If students are not receiving services, they should not be paying for them.

For the suit that is being filed in Orlando, the client’s mother pays $810 for her daughter’s room at The Retreat. The complex is closely tied to the University and has a technology center, sports facility, a sauna, club room with pool tables, and a coffee bar.

This is highly relevant, as Preferred Apartment Communities stated in a letter that all fitness centers and inside amenity spaces would be shut down. They would only open if emergency repairs needed to be made. Later that month, on March 26th, the housing complex released a statement saying that though they were sympathetic to the hardships brought about by the pandemic, lease agreements would not be altered. They then proceeded to collect rent for March, April, May, and June.

Making a difficult time worse

The Lawyer who represents the student stressed for students and families; the defendant is making a difficult time worse by prioritizing profits over protecting its reputation as a company that cares for its clients. When a tenant breaks a lease, it will hurt their bottom line, but how long can students maintain paying for a space they are not currently living in?

It is unclear how many students have had to return home, but one can assume that this is not an issue within a vacuum. Campuses and the apartment complexes that surround them have begun to encounter these complications. Although there are procedures to prevent eviction, there are not many rules in place for early lease termination as a direct result of the pandemic.

Of course, like most controversial issues, there are always two perspectives. A lease is a legally binding contract. Although a moratorium has been placed on evictions (note that the moratorium only staves off the eviction process and does not prevent it), it does not exclude someone from the obligations placed upon them because of their lease.

Colleges can only provide limited help

Although colleges cannot stand between an off-campus apartment complex and the students who live there, they are trying to help by providing tips for anyone struggling. Indiana University gave its students advice on what to do if you must leave your rental unit early because of the COVID-19 virus.

They highly recommend having all communications done in writing and fully communicating to your landlord your situation. If your landlord agrees to lease termination, be sure that you get it in writing. Specific actions such as cleaning the unit before you leave, removing belongings entirely, and arranging to turn in your keys can help lessen the potential payment you have to make when breaking your lease. Still, unfortunately, such actions might make zero difference in the long run.

Consequences of an Unbreakable Lease

The consequences of breaking your lease could be vast and progressive. Lawyers speculate that once the eviction ban expires, landlords will sue to gain possession of their apartments and seek payment for rent that was unpaid. If you are sued, it could damage your credit, making it harder to own or rent a property in the future.

Landlords can be skeptical of who they decide to rent to, and if they see public records reflecting nonpayment for rent, this could be a dealbreaker. If they choose to work with a collection agency, this could damage your credit score. It is truly a complex issue with many angles to consider.

What can we learn from this situation? Legally speaking, contracts are like tools, each has a use, and each has restrictions and limitations as to how it can be used. We highly recommend starting any complex analysis by taking a deep dive into the language found in the documents that were signed. Sit down with a lawyer (preferably one of ours), to discover how the language in those contracts affects your situation.

Wrapping up

When a complex issue arises, both parties feel they are in the right, and both parties stand to lose value they feel entitled to. For the companies that rent to students, they are apprehensive of the mass exodus that would occur if they allowed their tenants to terminate their leases. For the students, paying rent for apartments they do not inhabit is a luxury they cannot afford, but it may be one they inevitably have to pay.

June 29, 2020/by The Orlando Law Group

How Extensions in the CARES Act can Help Hurting Homeowners

All posts, Bankruptcy, Consumer Law, Coronavirus, COVID-19, Real Estate

COVID-19 has changed our lives as well as our livelihoods. Income sources have taken a massive hit, and with that, rules are having to change, deadlines are having to be extended, and significant changes are being implemented to help families survive during this stressful time.

Although a phased approach is being taken to open the economy back up, it will be a long road back to normalcy and the financial status many maintained before the coronavirus pandemic.

Specific extensions in the CARES Act are designed to help.

The article below details some points about the CARES Act that are important for homeowners.

Section 4022 – Moratorium on Residential Foreclosures

On March 27, 2020, Congress enacted the Coronavirus Aid, Relief and Economic Security Act of 2020, also known as The CARES Act, which provides for financial relief due to the COVID-19 Virus Pandemic. This Act is put into place to do precisely what the name implies. The CARES Act provides care for this who are struggling because of the stress of a halted economy.

Section 4022 focuses on homeowners and provides a moratorium on residential foreclosures for borrowers with federally backed 1-4 family mortgage loans. It addresses the right of a homeowner to request forbearance from payment on these loans.

Understanding the Requirements – Extensions in the CARES Act Regarding the Foreclosure Process

The requirements only apply to federally backed mortgages, which are loans insured or guaranteed by FHA, VA, USDA, or loans that are owned or securitized by Fannie Mae or Freddie Mac. The moratorium does not apply to vacant or abandoned property or private bank loans. Under the Act, no mortgage servicer of any federally backed 1-4 family mortgage loan is permitted to do the following beginning March 18, 2020, and ending May 17, 2020; and now further extended until June 30, 2020:

Initiate any judicial or non-judicial foreclosure process;
File a motion for foreclosure judgment or order of sale; or
Execute a foreclosure-related eviction or foreclosure sale.

Utilizing the Extensions – Requesting a Forbearance

Section 4022 also allows a borrower on a federally backed 1-4 family mortgage loan to request forbearance from payment up to 180 days with the right to request an additional 180-day extension. Section 4023 allows a borrower on certain federally backed multi-family mortgages to request forbearance for up to 30 days with two 30-day extensions. During the term of forbearance, a tenant cannot be evicted or charged late fees. Section 4024 establishes a temporary moratorium on eviction filings for particular single and multi-family housing. During the above referenced period beginning on March 27, 2020, a lessor cannot initiate an eviction for nonpayment of rent. After the moratorium period, the landlord may not evict a tenant unless a 30-day notice is provided to the tenant.

Governor DeSantis also issued Executive Orders 20-94 and 20-121, consistent with the CARES Act, extending the foreclosure moratorium to all foreclosures and tolling residential evictions until June 2, 2020, but did not waive the obligation to make scheduled payments. Many Florida judicial circuits have also entered administrative orders which limit or prohibit foreclosure and eviction actions. These are meant to stave off the process and help families who are struggling to make ends meet.

What About Title Derived Through Foreclosure?

As a result of the federal and state law foreclosure moratoriums, until further notice, you are required to obtain approval from Underwriting to insure the title or issue a policy based on a foreclosure action where the certificate of title or writ of possession was issued after March 18, 2020, but before the expiration of the CARES Act and Executive Orders 20-94 and 20-121, now on June 30, 2020.

Additionally, title to any property derived through a foreclosure initiated during the effective period of the CARES Act and/or Executive Orders 20-94 and 20-121, will not be insurable.

As deadlines get pushed, and laws get stretched to allow for more financial breathing-room, it is essential to keep in mind how these rules apply to your specific situation. We have many questions that come into our office, and we are always honored to take the time and help someone gain clarity. Sometimes, legal rulesets can become cumbersome. That is why our lawyers are professionals at translating the legal jargon into a crystal-clear understanding of the law.

We are here to help you understand how these rules can apply to you. If you have questions, do not hesitate to reach out to us. We can, and we will help you through it.

Critical Advice: Selling Your Home During COVID-19

May 28, 2020/by The Orlando Law Group

Critical Advice: Selling Your Home During COVID-19 from Real Estate Pros

All posts, Coronavirus, COVID-19, Real Estate

You’ve decided to sell your house, but the market lost its influx of buyers due to fear induced by the coronavirus. There are many things we cannot plan for when it comes to being in the mind of the buyer, but if we hit specific standards during the sales process, it may not matter.

There are indeed ways to conduct Real Estate on a high level during chaotic times. You must be patient and cunning, two traits that often feel mutually exclusive. Perhaps circumstances out of your hands have prompted the sale, and you cannot simply take the house off the market.

There comes a time in business when we each are forced to commit to our decisions, despite external circumstances. That’s when we get very good at what we do.

This article is dedicated to hints that will help you navigate a complicated market. It doesn’t take a pandemic to have sellers face hardship. Complications could arise for any reason, and so many times, sellers must come back to reality and restructure their goals. During the Great Recession, many people faced difficulties getting their property situated correctly in the market. For many, it took months before getting offers and weeks after that to get an executed contract. It can be a stressful process, especially with a family facing uncertainty. It’s all about having your rules that work and having a scientific, learning-based approach. These five tips can be used to your advantage and help you through the trials and tribulations.

Make Sure That the Price is Right – This is both a reference to the classic TV Show, but also a recommendation to set your sales price competitively. You need to price the home at a place where you get attention in a drifting market. If you price too high, it will be like you never even put the house on the market at all, and you won’t get the attention you need to sell faster. Always consult real, sold comparable properties. Do not just go off what else is listed because there are no rules that keep someone from putting their home on the market with a price that’s too high. Be the one that prices your home right, and you’ll be the next in line for a serious offer.
Become a Perfectionist – This may sound a bit excessive, but you will have potential buyers that are just as excessive with their attention to detail. In a strenuous market, every single point of interest has significance, and it is worth your time to compare your property visually to all the competition out there. Being competitive always comes down to the details, and we encourage you to do everything in your power to compete. If it’s something that wouldn’t make or break a sale for you, that doesn’t mean your buyers won’t care about it. Everyone has different priorities when it comes to the purchases they make, and many times conducting business on a high level is about being able to think outside of our perspective.
Tour Your Own Home – Take a drive outside, and once you’ve gotten into the mindset of a potential buyer, take a walkthrough of your abode. Be critical of the details. If the door gets stuck, it may not have bothered you after years of living there, but it’ll stand out as a rough first impression. Speaking of, pay close attention to the front of the house. First impressions are everything, and giving a little bit of T.L.C. to the landscaping can add so much curb appeal. Take a weekend and see what you can add that doesn’t break the bank. A clean, minimalistic approach will be the best for having buyers envision their designs and potential plans.
Have a Solid Copilot, but Never Fly Blind – Hiring an excellent Real Estate agent that is going to offer incredible advice can be your most significant advantage in the market. One of your biggest disadvantages could be just letting them handle it and clocking out of the details of the sale. You want to keep a close eye on the week-to-week movement your property undergoes on the market. Many times, clients hire a Real Estate agent based on the feeling they get when talking to them. This can lead to a tendency to lean away from the hard questions. We want you to lean into those discussions. Your agent is there to help you navigate tough waters, and they should always be okay with discussing options, opinions, and points of view that differ with their own.
Waiting For More Money Could Mean More Hardship – Ironically, we always consider money to be more valuable than time, even when it costs us money. Deciding to walk away from a sale because you feel like you deserve $5,000 could cost you a serious buyer. In a market where the next potential buyer could be weeks away from walking into your home, you’ll spend that much money searching for another serious offer. Don’t always let numbers stop a good meeting of the minds and keep challenging yourself to think from the buyer’s point of view. It could mean taking a serious offer despite it not being up to your asking price. The highest offer isn’t always the best, and although that sounds counteractive, time is always an easily forgotten factor. The best offer is the one that can close, and that saves you time, energy, and money spent in the future.

These are five tips to always keep in consideration when conducting Real Estate, but they are especially important to remember when the market shifts. The housing market is still affected by external forces, and COVID-19 is no different. These are ways you can keep a certain level of control over your circumstances. We are here always to help you and have myriad of incredible business professionals to recommend, including Realtors! Keep your head held high, your faith filled full, and your goals gradually going. You’ll get to where you need to be in time.

April 21, 2020/by The Orlando Law Group

Real Estate Changes and Updates Due to COVID-19

All posts, Coronavirus, COVID-19, Real Estate

Our New Normal

When a new normal forces industry to adopt new ways of doing certain actions, we employ technology. Ideally, there would be flowers and gifts at the closing table and opportunities for celebration between the agents and their clients; however, these are different times. These are the days of the Coronavirus Pandemic. Drive Up Closings are being employed to help with social distancing, and yet that doesn’t stop great agents from sitting in their car nearby to offer any advice and assistance necessary. The agents make sure to stay the standard six feet away, but their presence is welcomed, even if it’s just to show support for their clients.

Glass Half Full

The good news is that buyers and sellers can still close transactions. Real Estate hasn’t stopped, and transactions shouldn’t be held up due to the need for social distancing. Real Estate closings tell the same tale being told throughout every single industry: “How do we accomplish our tasks in new ways that help us remain remote?”

Unfortunately some counties locally have closed their recording office or other offices which deal with re-zoning and other related real estate issues which have impacted our ability to close on a case by case basis. Probate courts have mostly remained open for short, phone hearings which have allowed us to move forward for hearings to free up the sale and closing of homestead and other properties impacted by probates. Family law has mostly slowed to a stop, but in the next week should start again with video hearings which should help properties tied up in a divorce to get moving again. The key is to be very proactive if your transaction is challenging in any way.

As we push to help properties to close, at home closings are taking place, and if clients come into the office measures are being taken to insure sanitization, social distancing and the least contact possible.. Anyone deemed non-essential to the process is being asked to video conference into the meeting if they want to be involved. One of the ways in which we can do our best to cope with change is by being flexible. There are many documents that can be signed electronically, but lenders do require some to be signed in person. This may change in the future, given the fact that signing electronically could potentially mitigate having to meet, but the liability could be too much to shoulder. For the time being, we will work hard to do the most remotely that each industry can, while also maintaining the due diligence of the task itself. We have done our best to start using On Line notary, but a few clients have had challenges with the software, so we need to not wait until the final hour to get documents signed. Again being proactive is key.

Future Forecast

It is incredible to see industries doing all that they can to stay open while also maintaining guidelines that will help flatten the curve. Our prediction is that many places will similarly begin to start using remote and drive-up services. Although some work must take place in person, it doesn’t mean that you absolutely must be closer than six feet from other parties.

Will things ever go back to normal? We are of the mindset that business will slowly begin to get back to standard operating procedures, but it may take some time. We want to put everyone’s health as a top priority and adapt as much of our normal practices that we can to help better the comfort and confidence of our clients. Every industry will have to change.

We Are Here to Help

With everything going through a period of change, it’s important to remember that we are all here to help you. Even if it’s questions you have about how technology will affect your industry and how COVID-19 could play a role on the business that you work in, we’re happy to help you navigate those waters. We view ourselves as more than just lawyers for our clients. We’re resources for rules that can be made to work in your favor, and many times a conversation with us helps someone find comfort, confidence, and clarity. Once this is all over, we’ll find a significant emphasis on the shaking of hands, the closeness of friendship, and the ability to be together more often. For now, we must work hard to flatten the curve, adhere to social distancing guidelines, and stay as healthy as humanly possible.

April 13, 2020/by The Orlando Law Group

Title Insurance Truth or Dare…featuring RON

All posts, Coronavirus, COVID-19, Personal, Real Estate

Okay, it’s time for some truth serum. The Title Insurance Industry is a business that is continually evolving. Real Estate Agents must deal with title companies, and their clients get title insurance on every transaction they handle. While we socially distance ourselves due to the Coronavirus, it’s a perfect time to level up what we do and how we do it. There may be a thousand ways everyone else accomplishes a task, but the way you’re going to stand out and innovate is by finding that one way that no one thought about.

In this article, we will be diving into the truths that have prevailed within the business of Title Insurance. We will also look at how to be daring enough to use them to your advantage.

If you work as a Real Estate Agent, in the field of Title Insurance, or are simply an entrepreneur looking to create some innovative tactics while you’re at home staying socially distant, you’ll find something useful. You will be challenged, and each of our truths is partnered with a dare for you to try out. Take a scientific approach and grow through experimentation. We will say this: to the daring always go the spoils.

Truth: Good Communication is Key – This might seem simple, but anyone who has worked in Title will understand that it’s those who communicate well that stay in the game. Communication is all about being thorough, and at the same time caring about who you’re working with. We dare you to get to know everyone involved, that way you can be completely aware of any situation that might arise. Having systems and processes in place to make sure you’re following procedures is just the beginning. Information is vital, and although text can be the easiest way to expedite responses, nothing beats a good conversation over the phone or in person. Right now, due to the Coronavirus, even avenues like Zoom are a better way for someone to see your face without having to be in the same room.
Truth: Set Expectations and Have Checklists – So many individuals have to work from home right now because of COVID-19. Without checklists and working documents, that can be difficult. Working documents are real weapons in business. Checklists keep order to what can quickly become a chaotic process. We dare you to have templates on your computer of checklists, and we double dare you to print them off! There’s no better feeling than being able to check off a box and look at your checklist, knowing everything has been completed. Also, save some room for custom points you can add that the clients specifically want or need taken care of. Working documents are made to be worked on and evolved.
Truth: Get to know RON – What is RON? Who is RON? Is he Harry Potter’s best friend? Yes, but not this RON. You are probably curious as to how notarization is going to work during the COVID-19, socially distant world we’re experiencing. RON or Remote Online Notarization is going to become your best friend in this scenario, and especially as we have to stay distant to flatten the curve of this virus. Taking advantage of technology can be arduous, but it’s always worth it eventually. We dare you to try new avenues of technology that make your job that much easier. Work with a title company that is taking advantage of RON (we are)!
Truth: Create Your Special Recipe – This is something that requires a little bit of creative work. Create something unique that only you do as a Realtor, Title Agent, or business entrepreneur. This could be a gift that you present at the end; it could be a program where you follow up after the closing has taken place, or it could be a special place you take everyone for lunch once the victory has been achieved. Even if you can’t take them to lunch because of COVID-19, perhaps a Zoom happy hour where you can speak about the future and celebrate the transaction completed will be perfect. The point is to make them feel like this particular action is unique to your business (hopefully it is). We dare you to make it as personal as possible. It’ll help you stand out, as well as build strong ties with those that you do business with.

We work with a vast array of agents, and just like Real Estate and Law, The Title Insurance Industry is dependent upon the Title worker. It’s all about the level that you want to achieve, and we want to encourage you always to have the mindset of leveling up what you do.

Seek out your truths and the truths that others have discovered and dare yourself to try new things. Right now, everyone has to adopt new strategies and plan because of how the virus has changed our daily lives. We must remain hopeful. Innovate, recalibrate, and formulate processes that both take inspiration from your heroes and make you an inspiration for others. When it’s all said and done, add your flourish, and dare the world to do the same.

April 9, 2020/by The Orlando Law Group

Important Clauses For A Residential Rental Agreement

All posts, Real Estate

A Landlord’s Perspective

Almost all residential rental agreements are different, and each one should be gone through in detail before being presented to a renter. Rental agreements should not be made from an agreement template or boilerplate and should be tailored to fit the tenant at hand.

We have gathered some information on a few typical clauses found in residential rental agreements that we believe are important to the contract. This is not an exhaustive list of provisions that we recommend in a residential rental agreement.

Liability- Joint and Several

As a landlord, you want your tenants to pay the rent and to be able to collect rent from all of your tenants on or before the due date. You do not want to find yourself in a position where one tenant has paid their portion of the rent while the other tenants have not, and then have to track down the remaining unpaid tenants.

A Joint and Several Liability Clause basically states that every tenant is jointly AND individually responsible for the entire monthly rent amount and any damages to the unit.

This clause will help protect the landlord in a situation where a tenant is claiming that they have paid “their portion” of the rent, and they do not have to pay for the rest of the tenants’ rent.

If you explain this clause to the tenant, it may help influence which people they allow to move into the unit because they will want to live with roommates that they are certain will pay their share of the rent amount.

Use of Premises

In the terms and conditions of a residential rental agreement, you are allowed to restrict the number of people living in the rented unit. This clause will help prevent your rental unit from becoming the local party house, or from a family allowing other family members to move into the residence.

If your agreement to rent is based on a family of four (4), add this clause to state that the premises should be used and occupied by no more than four (4) people.

Every family is going to have a guest come to visit at some point, so you should add wording that allows a guest to remain in the house for a certain amount of time, such as a week, two weeks, or 30 days.

Your clause should state that if the guest remains after that time period, they need to be added as a renter under the agreement, and you can increase the rent amount to reflect the additional person in the unit.

Prevailing Party Attorney’s Fees

Reimbursement of Attorney’s fees is only available when they are included in a contract, or when they are provided for in a state statute. Residential rental agreements are covered by chapter 83 Florida Statutes, Part II. Florida Statute § 83.48 provides for attorney’s fees

For rental agreements in Florida, this statute may cover you regardless of whether it is listed in the contract.

However, it is still wise to list this in the contract for two reasons, (1) the tenant will be put on notice of the ability for the landlord to seek attorney’s fees (and vice versa); (2) there are certain situations such as a lease-option agreement that may turn what you consider to be a residential lease into a contract for sale.

The addition of the attorney’s fees clause in the contract may allow you to collect attorney’s fees in a situation where your “lease” is not governed by Chapter 83 Florida Statutes.

Severability Clause

This clause states that if one portion of the lease is ruled invalid in court, the rest of the lease is still legally binding. In some cases, the court will void a clause because it contradicts a state law or federal law.

Without this clause, a judge might rule an entire lease void because of one unenforceable provision of the lease, even if the rest of the lease could have otherwise been saved.

Access to Premises

During the lease, situations may arise where the landlord needs access to the unit. Florida Statute §83.53 covers a landlord’s access to the premises. Landlords and tenants must adhere to but not limited to the criteria below:

The tenant must be given notice of at least 12 hours prior to the entry
Reasonable time for repairs is between the hours of 7:30 a.m. and 8:00 p.m.
A tenant is not permitted to unreasonably withhold consent from the Landlord to enter the property to inspect the property, make necessary or agreed repairs, decorations, alterations, or improvements.
The landlord may also enter the dwelling following:
The explicit written consent of the tenant.
In case of an emergency.
If the tenant is absent from the premises for a period of time.
The tenant cannot prevent a landlord from showing the property purchasers, contractors, or potential tenants if the landlord complies with the notice requirement.

Although this statute provides the landlord with the ability to access the premises, it is wise to list this in the rental agreement because it puts the tenant on notice of this right. When the tenant refuses to allow access, you do not have to cite a statute that the tenant has never read.

This will give you the ability to cite directly to the standard lease and may be enough to convince the tenant to allow you on the premises.

Use of Premises 

This clause dictates how the premises are to be used during the rental period. This clause is very broad and should be used to cover all areas of the property, such as swimming pools, decks, garages, sheds, backyards, etc.

This section of the lease may need to be tailored to fit the tenant(s) each time there is a switch. Children in the residence may require certain rules that an elderly person would not.

If the landlord does not wish to have any animals in the rental, this is the section that should state, “NO PETS ALLOWED.” Additionally, Commercial activity, such as a home business, can have many adverse effects on the rental agreement.

In this clause, the landlord should identify whether they will allow any commercial activity to be conducted on the premises.

Sublease(s) and Assignment(s)

Subleasing and/or Assigning a lease is allowed unless it is expressly outlawed in the rental agreement. If it is not outlawed in the lease, then there is a very real possibility that this issue will arise (it may even arise if it is outlawed in the lease).

Some landlords are fine with this because it creates the possibility of easily replacing a tenant, and some landlords even charge a fee for this. However, an assignment or a sublease can also create huge issues if the replacement tenant is not desirable.

This section of the lease should be used to clearly identify the rights (or lack thereof) to subleasing or assigning the agreement.

Conclusion

If you have a rental or are considering renting your property, you should have a residential rental agreement that adequately protects your interests. Do not download a boilerplate form from the internet and assume you are covered especially as the law does change.

March 10, 2020/by The Orlando Law Group

Amending HOA Documents And The Unlicensed Practice Of Law

All posts, Blog, Condominium Owners Association (COA), Home Owners Associations (HOA), Real Estate

Often times, a community association relies on an attorney to assist with the modification of its governing documents, and to provide answers to questions that affect not only the rights of the community association but its members as well.

There are certain documents that must be completed by an attorney, based on the fact that they involve the interpretation of Florida Statutes while requiring a level of legal expertise and a familiarity with the Association’s Articles of Incorporation, Bylaws, Covenants, and Declarations. Further, based on the fact that the officers and directors of an association owe a fiduciary duty to its members, it is important to keep in mind that any document pertaining to their obligations, or the obligations of its members, be drafted properly.

What HOA activities require an attorney?

The following activities are considered the unlicensed practice of law if performed or completed, on behalf of the association, by anyone other than an attorney:

Drafting a claim of lien;
Drafting a satisfaction of claim of lien;
Drafting a Notice of Commencement Form;
Determining the timing, method, and form of giving notice of meetings;
Determining the votes necessary for certain actions, which would entail interpretation of certain statutes and rules;
Answering a community association’s question about the application of law to a matter being considered,
advising a community association that an action or course of action may not be authorized by law or rule;
Drafting any document that must comply with Florida law; and
Drafting the documents required to exercise a community association’s right of approval or first refusal to a sale or lease.

Due to the fact that such actions may affect, impair, or enhance the rights of numerous homeowners and their property interests, an attorney should be the one to draft and advise on them. Allowing anyone other than an attorney to complete these tasks opens up the association to liability, as well as the possibility of Florida Statute violations.

What are some HOA activities that are not considered the unlicensed practice of law?

Based on a Florida Advisory Opinion issued in 1996 and 2015 by the Florida Supreme Court, there are certain documents that can be drafted without the assistance of an attorney. Although this opinion references the actions of a Community Association Manager, the corollary is that it remains applicable to our discussion on HOA board conduct and the conduct of its members. With regard to the actions of non-lawyers, some of the following tasks may be performed:

A change of registered agent or office for corporation’s forms;
Annual corporation reports;
First and second notices of the date of the election;
Ballots;
Written notices of the annual meeting;
Annual meeting or board meeting agendas;
Affidavits of mailing; and
Completing a BPR Form 33-032.

If the additions or amendments pertain specifically to clerical matters and do not involve the interpretation of statutes, documents, or providing legal advice, the above-stated actions may be performed by a non-lawyer.

What are some areas of HOA law that remain unclear?

The Courts have deemed the following areas “grey”, therefore depending on your individual circumstances, you may or may not need an attorney to assist with the following:

Editing a limited proxy form IF the modification involves:
Filling in the name of the community association,
Filling in the name and address of the owner,
Phrasing a yes or no voting question concerning either waiving reserves or waiving the compiled, reviewed or audited financial statements requirement;
Phrasing a yes or no voting question concerning carryover of excess membership expenses; and
Phrasing a yes or no voting question concerning the adoption of amendments to the Articles of Incorporation, Bylaws, or condominium docs.

In addition to the Florida Supreme Court Opinions, an Association’s Declaration and Bylaws typically delineate the powers that a board of directors and its officers possess specifically with regards to the amendment of any governing documents. If such language is not included within the Association’s governing documents, an attorney should be consulted in order to determine how they should be amended.

If you have any questions regarding the actions of your homeowners’ association, or if you need assistance with drafting any of the above-stated documents, do not hesitate to contact The Orlando Law Group at 407.512.4394 to schedule a consultation today.

January 24, 2020/by The Orlando Law Group

What is Wholesaling Real Estate?

All posts, Blog, Real Estate

What is Wholesaling Real Estate?

Investing in real estate is an efficient way to make money and to diversify your investment portfolio. There are many different types of investment strategies that are commonly used to make money in the real estate industry. When people are starting, the difficulty is often “how am I going to invest in real estate if I do not have thousands of dollars saved up?” Wholesaling may provide you with an opportunity to make some money while spending very little out of your pocket. Wholesaling involves an investor entering into a contract with a homeowner for the purchase of their home, then he or she markets that property to other potential buyers. Once a new buyer is found, the investor will either double close on the property or assign their rights under the contract to the new back end buyer. The Investor will then keep the profit of the sales (if double closed) or keep an assignment fee charged by the new buyer.

The Contract

Once you have found the right property, the objective is to get the seller to agree to the terms of a contract, and to execute said contract. The contract’s contents vary drastically among investors, with each investor incorporating different terms. One fact is for sure, a solid contract is necessary to protect your interests. Using a typical FARBAR contract gives the parties warranties and responsibilities/liabilities that many investors do not want to be incorporated into their wholesale contracts. There is not a one-size-fits-all contract. Investors should be prepared to modify their contract as needed for each deal.

Determining the Price

Investors often have a difficult time trying to determine the price point where they need to be in the contract. If you have a bad price point for your wholesale deal, you will lock down the seller’s property for weeks or months and will be unable to complete the deal with a back–end buyer. The most common way to determine the price point needed for an effective wholesale deal is to use the “70% of ARV rule.” ARV stands for “After Repair Value,” and this value is what the house would be expected to sell for if sold to a retail buyer after all necessary repairs have been made. The general rule of thumb is that an investor who is flipping a house needs to be in a deal with an expected 30% return. This figure also provides a buffer for the investor in case repair costs or other fees run higher than were estimated. To calculate your offer based on the above formula, you take the ARV and multiply this number by 70%. From that result, subtract out the expected repair cost of the property. The remaining figure is the highest amount of money you should offer to the seller. As an example, we will use a house with an ARV of $100,000.00 and an expected repair cost of $20,000.00:

($100,000.00 x .70)= $70,000.00

$70,000 – $20,000.00= $50,000.00.

In order to fix and flip this house, the investor would ideally need to get this property under contract at $50,000.00. Cutting the margins any shorter may lead to a loss on the flip, although it can be done. For a wholesaler, in order for you to find a back-end buyer, you will need to offer them this property at or as close to the $50,000 figure. If the wholesaler can get the property under contract for $45,000, they can assign that contract to a flipper and easily make a $5,000 assignment fee. The shorter you cut the margins, the harder it will be to find a back-end buyer.

Assignment vs. Double Close

An assignment occurs when a wholesaler gets a property under contract, then finds a new buyer. The wholesaler and the new buyer execute an assignment agreement in which the back-end buyer replaces the wholesaler under the original contract. Accompanying this agreement, the back-end buyer tenders a non-refundable assignment fee to the wholesaler. A double closing is two closings. The wholesaler closes on the property with the seller, then immediately sells that property to the new buyer. Typically, the wholesaler will negotiate and contract with the back-end buyer to have as much of the closing costs as possible paid on their behalf. Whether to assign a deal or double close on a deal is typically dependent on the facts of the individual deal. An assignment is often preferred because the investor will have fewer overhead expenses since they do not have to close on the deal. Doing a double closing may also benefit the wholesaler if they are making a lot of money on the deal because the seller will not know how much money the wholesaler is making off of the back-end buyer.

Wholesaling Real Estate, is it right for you?

The idea behind wholesaling is that the wholesaler is the middleman between the seller and the back-end buyer. In most cases, the houses contracted for are off-market properties, so the wholesaler is actually finding the property and relieving the back-end buyer of this responsibility. For this service, the wholesaler charges a fee, typically as an assignment fee. Wholesaling has received a bad rap because many people will nickel and dime the sellers, who are often disadvantaged in some way or another, in an attempt to make the most profit possible. Wholesaling provides a great source of income, and it is a good way to keep properties cycling. The profits can also be dumped back into the marketing budget to drum up more properties. It is possible to wholesale ethically if you take the time to learn the process and reach an agreement with the seller that is beneficial to both of you.

This blog does not cover all of the intricacies involved in a real estate transaction, but it should serve a good starting point for your ventures. If you would like to know more about wholesaling, The Orlando Law Group, PL has knowledgeable real estate attorneys to help you navigate the process.

November 1, 2019/by The Orlando Law Group

The Reverse Mortgage: An Overview

All posts, Family Law, Real Estate, Wills, Trusts & Estates

A reverse mortgage is a loan available to homeowners age 62 years or older, that allows a homeowner to borrow against the equity they have in their house in the form of a lump sum, fixed monthly payment, or line of credit.

Unlike a typical mortgage, with a reverse mortgage, the bank pays the owner of the house monthly mortgage payments, and when the owner of the house dies or sells the home, the entire reverse mortgage balance becomes due and payable.

As long as the borrower is 62 or older and lives in the home, he or she is not required to make any monthly payments towards the loan balance. The concept of the reverse mortgage came about as a way to help retirees with limited income use the equity they have built up in their house without having to sell the property.

With these types of mortgages, the owner of the property is responsible for the property taxes and homeowners insurance premium, utilities, fuel, maintenance, and other home-related expenses. If only one spouse signed the loan paperwork, in certain situations, your spouse may continue to live in the home even after you die if he or she continues paying the above-noted bills and maintains the property. However, since they were not a part of the loan, all payments under the reverse mortgage will cease.

Most reverse mortgages have a “non-recourse” clause which means that the value of the reverse mortgage cannot exceed the value of the home when the loan becomes due. This is beneficial upon the death of the homeowner because there will not be any bills related to the reverse mortgage outside of the equity in the house.

No other assets in the Estate of the deceased are affected. There are three different types of reverse mortgages. As with any type of transaction, it is important to shop around before locking yourself into a long term loan.

Single-Purpose Reverse Mortgage

Homeowners can use single-purpose reverse mortgage proceeds only to pay for specific items that are approved by the lender. This single-purpose may be for necessary repair and maintenance, or payment of property taxes. The lender on this type of file is a state, local, or non-profit agencies, and is considered the least expensive type of reverse mortgage. This option is beneficial to many people because it offers fewer expenses and fees than other types of reverse mortgages.

Home Equity Conversion Mortgage

This type of mortgage is likely to be more expensive and is the most widely used version of the reverse mortgage. This is because there are not any income requirements, and the proceeds from the loan can be used for any purpose. This loan does not carry the same single-purpose limit detailed above.

Counseling is typically required before applying for this loan due to the higher expenses, interest rates, and payback requirements of this loan. Because this is a federally insured mortgage, there are usually high up-front or monthly ongoing insurance payments. These payments are usually taken out of the loan itself, and actually reduces the amount you are able to borrow.

Proprietary Reverse Mortgages

A proprietary reverse mortgage is not available to the average homeowner. As of 2018, in order to qualify for this type of reverse mortgage, your home must have a value of $679,650.00. This is not a federally insured mortgage and often has less stringent insurance requirements.

If you are considering this type of loan, you should also apply for the Home Equity Conversion Mortgage. This way you can compare fees to find out which loan fits better for your situation.

Wrapping it up

Using this type of mortgage can eat up the equity in your home, meaning there is less value to your estate that is left for your heirs. If your goal is to leave the house for your heirs to live in, a reverse mortgage may not be the right type of loan for you. If you would like to discuss how a reverse mortgage may benefit your situation, please contact give The Orlando Law Group, P.L. a call.

August 29, 2019/by The Orlando Law Group

New FREC Team Advertising Rules; What you need to know.

All posts, Legal Commentary, Personal, Real Estate

By Attorney Jarrod Etheridge

The Florida Real Estate Commission (FREC) has published the final version of Rule 61J2-10.026, which governs group or team advertising. This new FREC Team Advertising Rules impact office procedures and team advertising.

New FREC Team Advertising Rules go into effect July 1, 2019

Effective July 1, 2019, this rule is set to create some serious changes in the real estate industry. The reasoning behind the rule is that FREC was receiving complaints from the general public who were often being confused or misled as to who, or what they were dealing with during a real estate deal.

Group/Team names were often being mistaken to be the name of the real estate brokerage, and clients were often unable to determine whether they were dealing with an agent, a broker or brokerage. Under Florida law, only a broker is allowed to use a fictitious name. For example, Keller Williams, Coldwell Banker, Tavistock, etc. A sales or broker associate operating under a Florida entity is required to name the entity after themselves. By creating team names including certain words, FREC believes realtors are crossing this line.

What are some of the words no longer allowed in real estate team names?

Under the new rule, FREC has released an extensive non-exhaustive list of words that are no longer allowed to be included in team names. Whereas realtor teams are allowed to use the words “team” or “group,” almost every real estate team in existence uses one of the now prohibited words: (a) Agency (b) Associates (c) Brokerage (d) Brokers (e) Company (f) Corporation (g) Corp. (h) Inc. (i) LLC (j) LP, LLP or Partnership (k) Properties (l) Property (m) Real Estate (n) Realty (o) Or similar words suggesting the team or group is a separate real estate brokerage or company.

If your team name still meets the above, you are not out of the woods yet. The new rule also provides that on any advertisements containing the team name of any form, registered brokers must maintain a design where “the name of the team shall not appear in larger print than the name or logo of the registered brokerage.

All advertisements must be designed in a manner in which reasonable persons would know they are dealing with a team or group.” Check your business cards, website, mailers, etc., if your team or group advertising contains a name that is in a bigger font than the name OR logo of your brokerage, you are out of compliance with the new rules.

This is certainly a good time to be in the business of promotional items because almost every real estate agent in Orlando is going to be scrambling to get new business cards and other promotional items.

Do the new FREC Team Advertising Rules affect teams made up of agents from multiple brokerages?

For those very few teams whose names are still valid, the rule also adds a component requiring all real estate teams to be comprised of members of the same brokerage or under the supervision of the same broker. FREC is no longer going to allow agents from multiple brokerages to act under a single team.

What to do right now…

The Orlando Law Group is here to help if you need someone to review your current advertising schemes to make sure you are in compliance with the new rules. Judging by the drastic changes pushed forward with this rule, we do not recommend continuing to use any advertisements that are out of compliance starting July 1, 2019.

June 26, 2019/by The Orlando Law Group

The Florida Gopher Tortoise – A Slow Set-Back to Development

All posts, Legal Commentary, Personal, Real Estate

By Jarrod Etheridge

When purchasing a piece of property, it is important to consider a variety of factors, including the animals, like the gopher tortoise, that inhabit the landscape. If any endangered or threatened species reside on that property, be prepared for a long and potentially expensive process. This includes the gopher tortoise, who are commonly known for digging burrows in their home range in Florida, Georgia, and other southern states.

What is a gopher tortoise?

The gopher tortoise is a large terrestrial reptile that has front legs perfectly suited for burrowing. The rear feet of the gopher tortoise are often referred to as “elephantine” because of their size and shape.

The front legs are protected from sharp rocks while burrowing by a layer of scales. the scales are usually dark brown, gray, or black in color. They also have a yellow lower shell. You can easily distinguish a male or female gopher tortoise. Male gopher tortoises having concave lower shells, while females’ lower shells are more are flat in appearance.

Gopher tortoise habitats

Gopher tortoises occupy various habitats throughout Florida. They use their front legs to dig burrows many feet deep for shelter and forage on low-growing plants. You may have seen them in a patch of woods or walking down the road.

Gopher tortoises share their burrows with more than 350 other species. They are referred to as a keystone species because of the Florida natural ecosystem’s reliance on the burrows.

A threatened wildlife species

In Florida, the gopher tortoise is listed as a Threatened Wildlife Species by the states fish and wildlife conservation commission. Both the tortoise and its burrow are protected by state law. Gopher tortoises must be relocated before any land clearing or development takes place within twenty-five feet of either a gopher tortoise or a gopher tortoise burrow. Property owners must obtain permits from the Florida Fish and Wildlife Commission (FWC) before capturing and relocating tortoises.

Developers, builders or landowners who develop within the protected area of a gopher tortoise or its burrow commit a crime under Florida law. It is a level four violation, as defined in §379.401(4)(b) is a felony of the third degree which if convicted could result in (1) a term of imprisonment not exceeding five years, (Florida Statute § 775.082) and/or (2) a fine of $5,000 (Florida Statute § 775.083).

If you buy a piece of property that has an existing gopher tortoise habitat or gopher tortoise burrows, you might have some work to do. The prohibitions related to gopher tortoise burrows will not be applied if you can demonstrate that those burrows are no longer used by gopher tortoises. To prove this, at your expense, a gopher tortoise survey will have to be conducted in accordance with the guidelines of the FWC.

Most activities associated with residential lawn and landscape maintenance do not require a permit provided the activities must not collapse gopher tortoise burrows, cause habitat loss, or harm gopher tortoises. Prescribed burning requirements vary from county to county and should be explored before burning near a gopher tortoise habitat.

Even if the collapse of the burrow’s sandy soils is accidental, the landowner could be held criminally or civilly liable for disrupting the tortoises. This is more likely if the person knew that their actions could harm the tortoises. It’s advisable to check with the fish and wildlife service professionals if you have any concerns.

Getting help developing land with gopher tortoises in Florida

P.A.W.S. (Peoples Alliance for Wildlife Survival) is a non-profit organization that helps landowners with the development of land containing Gopher Tortoise burrows. The organization’s primary concern is for the welfare of the animal during the stressful relocation process. According to its website, the organization can provide four options to help homeowners:

Option 1: Develop the property while staying at least twenty-five feet away from the Gopher Tortoises. This is advertised as the least expensive and most favorable open for both the landowner and the tortoise. The organization will help study mark the areas to avoid developing, and they suggest placing signs up that notify the public of the existence of the tortoises.

The cost for this service is around $100.00 through this non-profit organization. Using a private company could potentially cost hundreds or thousands of dollars. Many Florida builders have employees certified in detecting and protecting the Gopher Tortoise as they could be held criminally liable for disturbing them as well.

Option 2: Onsite Relocation. In some cases, you potentially have the option to relocate the tortoise to a different part of the subject property. “This process generally involves trapping or excavating the burrow, and once empty, completely collapsing it.

The tortoises are moved to the predetermined location elsewhere on the property. They are enclosed in a temporary pen and supported while starter burrows are created and they are eventually released.” P.A.W.S., https://www.pawsfloridachapter.com/Tortoiserelocationinfo.html. The cost for this service is $250-350.00 through this non-profit.

Option 3: Offsite Relocation. Offsite relocation is considered to be a more time consuming and costly alternative to the previously listed options. This route requires the highest levels of permits and oversight by government agencies such as the FWC. P.A.W.S. typically charges between $400.00 and $600.00 to oversee this service, which is compared to Private companies which can run up to $6,500.00 for comparable services.

Avoiding problems with gopher tortoise

A gopher tortoise problem can be easily avoided, but it can be a very costly and time-consuming problem if it is missed during the inspection period. Should you or your client have any issues relating to gopher tortoises, it is highly recommended that you address the problem as soon as possible.

Any attempt to relocate or otherwise remove the tortoises on your own could result in very significant fines and/or criminal penalties against you. Other types of wildlife have similar protections in Florida through an endangered species act and have their own experts to help landowners with mitigation.

Protected species include Bald Eagles, which are the most well-known. It’s also worth knowing about gopher frogs and burrowing owls. If you are in doubt if a species is protected, it is advised to ask a professional before you begin your project.

April 25, 2019/by The Orlando Law Group

The PACE Program – Are Solar Panels Worth The Trouble in Florida?

All posts, Legal Commentary, Personal, Real Estate

By Jarrod Etheridge

What is the PACE Program?

When a homeowner is looking to upgrade their home to solar energy, the first step is to determine exactly how the project will be paid for Since most people typically do not have thousands of dollars in their rainy day fund, many people will require a loan to finance the upgrades. The PACE program will provide the loan for the homeowner.

PACE, which stands for property assessed clean energy, is a new concept in financing home and commercial property improvements. PACE financing is an easy and effective way to finance a range of upgrades that save energy, conserve water, harness renewable energy, and protect against natural disasters such as hurricanes and earthquakes. While PACE programs are enabled by state legislation and approved by local governments, PACE financing is not a government discount or incentive program.

PACE financing is a loan that is available in areas where the local government has allocated funds to be used for financing improvements on residential and commercial properties. An authorized PACE lender provides the funds to the homeowner, and the property owner repays the financial institution through an assessment attached to their annual property tax bill. The specific amount of money you qualify for is dependent on the amount of equity in your house. Hundreds of home and commercial improvements qualify for PACE financing. Among the more common are solar photovoltaic (PV) systems, roofing, HVAC systems, impact-resistant windows and doors, drought-tolerant landscaping and many more.

The PACE program provides many benefits such as no money down with 100% financing and no payments for up to twelve months. A PACE loan is different than traditional loans because it attaches to the property, not the person. This means that the person who takes the loan can sell their house, and the loan is then paid by the new owner of the house.

A loan with zero upfront costs attaches to the property rather than the person, and provides upgrades such as Solar panels, almost sounds too good to be true. Are there any downsides to a PACE program loan? For many homeowners, there have been.

Are there problems with the PACE program?

Ygrene Energy Fund is one of the bigger PACE program lenders in Florida. A typical PACE loan financed through Ygrene Energy Fund Florida lasts about 20 years with an average interest rate of about 7 percent. The PACE program has a higher interest rate than other green mortgage alternatives such as FHA loans. Borrowers can expect to repay twice the project cost over the payback period. As with any other type of loan, failure to make payments to a PACE loan will end up in a lien, which eventually could result in foreclosure. A property assessment automatically becomes the first lien on any property, putting both the borrowers and the mortgage lenders at risk of losing their money. With the risk incurred by the mortgage company, many lenders will not finance a purchase of a property holding a PACE loan.

Many issues have arisen with contractors recommending a PACE loan to homeowners. It has been reported that some contractors charge more money for services that are financed through a PACE loan. There have also been reports of contractors stating that the price of payments on the loan would be offset by the amount of money the homeowner saves in utility bills, which for many homeowners was not accurate. In many instances, the homeowner relies on what the contractor has told them, regardless of whether this information is factually accurate.

Should I use the PACE program?

Many homeowners did not take the time to read the full contract for a PACE loan, nor did they do the appropriate research to determine if this program was the right program for their specific situations. Some homeowners have alleged that they did not even know that failure to repay the loan would result in a lien on their property. If the house is foreclosed upon, the homeowner will have to pay the PACE loan off in full. If there is any money left over, the lender of the mortgage (if there is one) will be entitled to the surplus. This would leave the homeowner with a very unlikely chance of receiving any money from the foreclosure sale of their home.

Is it worth getting a PACE loan for solar in Florida?

Yes, and No. The PACE program is not a one-size-fits-all program and should be scrutinized by each homeowner BEFORE they sign the contract. If you understand the PACE program, there are certainly ways to use it to your advantage. The real issues with the program seem to stem from homeowners jumping into a program without fully understanding the long-term contract. After the Solar panels are installed, the reality sets in that the PACE loan is a 20-30-year commitment that can potentially cost twice as much to repay, if the homeowner can make the payments at all. If you are the type of person who reads the terms of service on products you purchase, you should not have any problems with the PACE program, however, the PACE program is not a commitment in which you want to agree to the terms of service without first reading them.

April 15, 2019/by The Orlando Law Group

What you need to know about the Lady Bird Deed benefits

All posts, Probate, Real Estate

What is a Lady Bird Deed and why is it beneficial?

Florida is one of only a handful of states that recognize a Lady Bird Deed. A person who creates a Lady Bird Deed, also known as an Enhanced Life Estate Deed, transfers property to himself for his lifetime, creating a life estate in the original owner, and names one or more people, entities, trusts, or organizations to inherit the property.

The life estate retained by the original owner of the property is enhanced, meaning that the owner retains actual ownership of the property until death, and can change the deed, mortgage, or sell the property as desired during their lifetime without permission or involvement of the remainder beneficiaries. When the owner of the property dies, the property is automatically transferred to the new owner(s) listed on the ladybird deed. A house that transfers through a life estate deed completely avoids probate because it transfers at death, and therefore does not become a part of the Grantor’s estate.

Benefits of a Lady Bird Deed

Ensures that the property passes to the person or people of the Grantor’s choosing by avoiding probate of the property.
Grantor maintains the right to use and profit from the property for their lifetime
Grantor maintains the right to sell, mortgage, or even execute a new lady bird deed to the property at any time, without having to obtain the permission or authorization of the grantee on the previously executed lady bird deed.
Grantor avoids making a gift that might be subject to federal gift tax
Does not risk the Grantor’s Medicaid eligibility because it is not considered a “transfer” until the Grantor passes away.
Prevents the property from being sold upon your death to repay the Medicaid benefits conferred upon the Grantor, because the property passes to the Grantee(s) upon the death of the Grantor and does not become an asset in the estate of the Grantor.
You keep your homestead real estate tax exemption, and the county will not reassess the property to raise taxes.

The Lady Bird Deed and Medicaid

Medicaid is a government program that provides Florida residents with long-term health care coverage. Medicaid benefits are intended for people who can’t otherwise pay for their medical care. To apply for Florida Medicaid, the state’s Institutional Care Program, an individual must provide the Department of Children and Families with a detailed list of all assets.

The purpose is to ensure that all available financial resources are used to pay for care before Medicaid funds are used. The value of all qualifying assets, called countable assets, is calculated and used as the basis for creating a Medicaid eligibility waiting period.

If a time should come when you require long-term care and you apply for Medicaid, the government will impose a five-year “look back” period on your eligibility. This means you cannot transfer ownership of property within five years of making the application. The extent of your eligibility depends on the value of assets you own at the time you apply.

Less is more, and many people erroneously believe they can simply give property away before applying, however, transfers are subject to this five-year period, and assets given away during this time can be pulled back into the value of your estate. Because an enhanced life estate deed allows you to retain control over the property during your lifetime, it doesn’t qualify as a transfer until the death of the Grantor.

If you receive Medicaid benefits during your life, then after your death the State will make a claim for repayment from any assets in your estate. The State will not be able to make a claim against any property with a valid lady bird deed because the property doesn’t become part of the decedent’s estate. The property automatically transfers into the ownership of the Grantee listed on the lady bird deed.

Tax Planning and Benefits with a Lady Bird Deed

There are a few tax benefits for a Lady Bird Deed in Florida, such as avoidance of the Federal gift tax. The Lady Bird transfer is an incomplete gift, meaning there is no requirement to file a gift tax return. There has not been an effective transfer during the owner’s lifetime. Moreover, the Florida Department of Revenue assesses minimum documentary stamp taxes on Lady Bird Deed property transfers as long as the grantor of the deed is the same person who retains the life interest. This means that your documentary stamp taxes would only be based upon a sum of $10.00 consideration, instead of the value, or sales price of the home. This can potentially save your heirs a few thousand dollars. If the deeded property is a homestead, there will be no loss of homestead tax exemption and the county will not reassess the property to raise taxes.

Estate Planning with a Lady Bird Deed

A lady bird deed, if done correctly, can be a very useful estate planning tool. There are many advantages of using a Lady Bird deed over other types of deeds. If you feel that this type of deed may be beneficial to you, would like more information or would like to discuss other possible options, please give The Orlando Law Group, PL a call at (407) 512-4394.

March 29, 2019/by The Orlando Law Group

The Airbnb Miami Beach Battleground is Heating Up

All posts, Real Estate

Airbnb Miami Beach property owners face another setback

An appeals court in Miami Beach has overturned a temporary injunction that prevented the city from cracking down on short-term rentals like Airbnb Miami Beach properties. The injunction was a small victory for Airbnb in a bigger fight against the city that has the potential to put hundreds of home-sharing hosts out of business. With the injunction overturned, the city of Miami Beach Code Enforcement can now investigate and fine home owners who offer part or all of their property as short-term rentals through websites like Airbnb and other home-sharing portals.

As of the end of 2017, the city had issued more than $6 million in fines, but only managed to collect a small fraction of that, totaling just over $100,000.

Recently the action against homeowners has taken a bizarre twist and crossed beyond monetary values.

Miami Beach shuts off a home’s water and electricity over delinquent Airbnb fines

Miami Beach homeowner, Ralph Serrano, recently had his home’s water and electricity shut off by the city of Miami Beach when he refused to pay fines for operating an Airbnb in the city.

In November, Serrano filed a lawsuit against the city and cited that the city used “strong-arm tactics” in their efforts to collect “constitutionally excessive fines” that summed to more than $200,000. In early December a district judge ordered the city of Miami Beach to restore the utilities to the property.

Before filing the lawsuit, Serrano attempted to communicate with the city about getting his utilities restored. When he did, city officials demanded he, among other things, ask Airbnb and other short-term rental websites to permanently remove his rental listing. Serrano notes that in the city zoning ordinance that permits Miami Beach to target homeowners who list their properties on Airbnb, nowhere does it say that the city can terminate utilities or request homeowners remove their rental listings on home-sharing websites.

What is Airbnb?

Airbnb is the world’s largest home-sharing or accommodation-sharing website. Through the website, property owners list their spare rooms or entire homes for rent to website visitors. The properties are listed in the Airbnb marketplace and are accompanied by descriptions, pictures, ratings, and reviews.

The website launched in 2009 and as of last year, helps over six million travels a year find accommodations among the 800,000 properties spread across 35,000 cities in close to 100 different countries.

How does Airbnb work?

Through the Airbnb marketplace, people rent out their properties to guests. The transactions are handled through the marketplace and Airbnb profits by taking 3% commission on each booking from the owners. Airbnb also takes between 6% and 12% from guests.

This arrangement allows homeowners with spare space, or unused homes, to make a substantial income while guests can stay in desirable locations for a fraction of the cost of high-end hotels.

Airbnb is used by a variety of demographics, from the average traveler to celebrities. For example, in 2016, celebrity Kylie Jenner rented a Miami Beach villa from Airbnb. The Hibiscus Island villa is worth more than $12 million, and the Airbnb rate is $8000 per night during the city’s Art Basel event. We’re guessing nothing was available on Star Island.

What are the legal issues with Airbnb Miami Beach?

According to the city of Miami Beach, vacation and short-term rentals are those in which the accommodations for a guest or group last less than six months and one day. While a popular alternative to traditional accommodations at hotels and resorts, there are some limitations that need to be considered.

Pursuant to the Miami Beach City Code (Sec 142-1111), home-sharing, vacation, and short-term rentals are prohibited in all single-family homes and in a majority of multi-family homes in certain zoning districts of Miami Beach. Here’s a map showing the short-term rental limitations.

In order to become an approved vacation or short-term rental, the owners must organize the proper authorization and zoning approval for operating residential short-term rentals

If a property is discovered to be illegally operating a short-term rental, the guests and owners will be immediately evicted. From there, fines starting at a wallet-thinning $20,000 will be levied.

Why does Miami Beach want to prevent short-term rentals like Airbnb?

Many people wonder exactly why the city of Miami Beach is working to criminalize residential short-term rentals. In short, it’s difficult to pinpoint. Miami Beach Mayor Dan Gelber has said that “Airbnb’s business model is not compatible with the kind of recognition that short-term rentals are not broadly in the public interest in cities…so they’re either going to fight or they’re going to change.”

There’s a heated political conversation about wither services like Airbnb are harmful to the economies of urban areas. At the same time, others are shining the spotlight on Miami-area officials who are driving to protect the area’s behemoth hotel industry. That’s a position that might have some traction. In 2017, leaked emails from then-Mayor Thomas Regalado’s office showed evidence of coordination with hotel lobbyists looking to implement a ban on short-term rentals.

In any case, the bans, restrictions, and fines appear to be here to stay.

Where does Airbnb go from here?

At this point, Airbnb appears to be on the losing end of this battle with Miami Beach. But the company might want to take an optimistic approach. There are many indicators that the fines for short-term rentals in Miami Beach are unrealistically high. Miami Beach commissioner John Alemán was quoted as saying that the city’s $20,000 fines are “grossly disproportional.”

Could that be the foothold Airbnb and others need to gain traction in this scrimmage against the city of Miami Beach? Time will tell.

While we wait for the outcome, our advise to you, if you are planning a trip to Miami Beach, is to be excessively cautions if you elect to use Airbnb. The last thing you want is to come back to your crash-pad from a stroll on the Lincoln Road Mall to find the power out and your belongings, and you, evicted from your accommodations. Chances are slim that Kyky will let you crash with her and her entourage on Hibiscus Island.

December 18, 2018/by The Orlando Law Group

Photo of Jennifer A. Englert - Attorney and Managing Partner of The Orlando Law Group

Lady Bird Deed – Estate Planning’s Best Kept Secret

All posts, Blog, Legal Commentary, Probate, Real Estate, Wills, Trusts & Estates

OLG LEGAL COMMENTARY:
Jennifer Englert
OLG Founder & Managing Partner

What is a Lady Bird Deed?

Also known as an enhanced life estate deed or a ladybird deed, a Lady Bird Deed is a way to transfer property to someone else outside of probate, and it allows the original owner to retain control of the property and pass it to exactly who he or she wants to after death. Basically the original owner (grantor) signs a deed stating when he or she dies the person who the property is deeded to (grantee) will automatically receive the property. In the meantime, the grantor has all right over the property including the ability to sell if he or she wants to.

Further, because you retain the rights to your property during your lifetime, the deed is simply disregarded for Medicaid purposes. This means that a transfer of Lady Bird Deed will not negatively affect your Medicaid eligibility.

Lady Bird Deed Advantages

A Lady Bird Deed has many advantages that should be considered, including:

Avoiding probate since the transfer of property can happen outside of probate.
Better control by the property owner who is allowed to, for example, sell or gift the property at will.
Since Lady Bird Deeds are not considered a transfer of property and the property owner retains the right to use the property, the Lady Bird Deed typically does not affect qualification for Medicaid benefits.
There are several tax benefits to a Lady Bird Deed, including the avoidance of filing a gift tax on the property transfer.
Many of the advantages of a transferring property under a living trust are similar to those achieved with a Lady Bird Deed. The advantage of the latter is that establishing a Lady Bird Deed is much less costly than creating a living trust.

In the state of Florida, it is also important to know that homestead or primary residence is exempt from creditors’ claims. Not only does a Lady Bird Deed protect this aspect of Homestead property and retain the homestead exemption, it can also potentially protect the property from a divorce settlement in certain cases. As the property remains Homestead it also retains the Homestead exemption for property tax as long as it is drafted appropriately.

While a Lady Bird Deed should not be a replacement for a full estate plan, it is a good place to start and it often belongs as part of an estate plan unless your only heir is your spouse in which case Homestead passes directly to him or her in the event of death without the need for probate. Without this type of deed even a Homestead property will need a Judge to sign off on the transfer in a probate proceeding unless it is passing to your spouse who is still alive.

How was the Lady Bird Deed named?

You might be wondering how the Lady Bird Deed got its name. When the deed was created in Florida in the 1980s, the creator used President Lyndon Johnson’s family names in the example of how the deed works. President Johnson’s wife’s name was Lady Bird and from that example, the deed was named.

The probate and estate planning team at The Orlando Law Group has this and many other strategies at its disposal to protect you and your family assets.

Jennifer Englert is the managing partner and founder of The Orlando Law Group, PL. For over 15 years, she has focused on business disputes, business law, general civil litigation, special needs & education law, family law, personal injury, and real estate. She has represented entities and individuals in both federal and state trial and appellate courts.

Founded in 2009, The Orlando Law Group, has been named one of the fastest-growing law firms in Central Florida and through America [ranked No. 105 among the top 500 fastest-growing law firms in the United States, per the 2017 Law Firm 500]. It has earned a reputation as the Orlando-area law firm that cares about its clients and the communities it serves. Offices located throughout Orange and Seminole counties. To contact Englert, or for more information about The Orlando Law Group, please visit www.TheOrlandoLawGroup.com or phone 407-512-4394.

October 17, 2018/by The Orlando Law Group

Florida COA and HOA Restrictions on Solar Panels; What You Need To Know

All posts, Blog, Condominium Owners Association (COA), Home Owners Associations (HOA), Legal Commentary, Real Estate

OLG LEGAL COMMENTARY:
Jennifer Englert
OLG Founder & Managing Partner

Whether you are a member living within a development governed by a homeowners association (“HOA”) or a condominium owners association (COA) and interested in installing solar panels on your home, or a member of the Board of Directors of a HOA, COA, or its respective architectural review committees, (ARC), in Florida, it would behoove you to become familiar with Florida Statute 163. It is essential that you understand what F.S. 163 says about COA and HOA restrictions on solar panels in so far as its governance and application to energy saving devices such as solar panels and F.S. 163’s effect on the governing documents of your association.

Clearing the confusion about COA and HOA restrictions on solar panels.

As one would guess, the primary area of dispute in an association controlled development is not usually the use of solar panels or whether energy saving devices are permitted or not, but rather, where those panels may or may not be located on the roof of the home or condo. May the solar panels be seen from the street? May the solar panels face the street or fence line? These are some of the questions about HOA restrictions on solar panels that Florida Statute 163 governs and attempts to answer. Florida Statute 163.04(2) expressly prohibits homeowner and condo associations from preventing its members from installing “solar collectors, clotheslines, or other energy devices based on renewable resources from being installed on buildings erected on the lots or parcels covered by the deed restriction, covenant, declaration, or binding agreement.” Id. However, that very same statute and subsection does permit associations to “determine the specific location where solar collectors may be installed on the roof within an orientation to the south or within 45° east or west of due south if such determination does not impair the effective operation of the solar collectors.” Id.

Recommendations for homeowners interested in installing solar panels in a COA or HOA governed community.

Clearly there are limits to HOA restrictions on solar panels. With this being stated, it is recommended that even though the association cannot deny the homeowner the ability to install energy saving devises such as solar panels on their property, that the member should still follow the applicable procedures set forth by the architectural review committee before any such installation. In conjunction with this issue, the architectural review committee of each association should also develop a well thought out Solar Policy. This policy should address solar and roof energy saving issues within an application to be submitted by all homeowners/condo owners before the installation of such devices. The application should address, among other issues particular to your development, a satellite or aerial image of the roof with the proposed locations of the solar panels; roof slope and angles; north/south orientation; clear illustration of any shading issues; manufactures product information for the units to be installed on the home; and for those homes intending to install the solar panels on a street-facing front roof that is not within 45 degrees of due South and faces the street, an explanation of why installing the solar panels on the other available roof space would not be equal to or more efficient than, that the street facing roof. Ensuring that the home/condo owner and the association are all on one page and at least attempt to resolve any disputes prior to the installation process can potentially save both the association and member thousands in litigation expenses, noting here that F.S. 163.04(3) does award the prevailing party to any such litigation, its attorney’s fees, and costs.

If you are a member of an association or on the Board of an association and are having problems with Florida Statute 163 and its applicability to your governing documents, please contact The Orlando Law Group and schedule an appointment to speak with one of our outstanding attorneys about your problems and concerns.

September 5, 2018/by The Orlando Law Group