The FREC (Florida Real Estate Comm.)

A friend of mine, who is selling her house, told me she is upset because her RE agent put up a sign on her property weeks ago, upon acceptance of a buyer's offer. The sign: "SOLD". At first, she was excited with the offer and did not mind it. The sale went down the drain and then she realized the sign had scared away good potential buyers. After a conversation about the matter with her broker, while questioning her right to refuse/accept the cited sign, he informed her that the FREC "did not have the statutory" authority to make the rule. RE licensees may now place "sold" signs in addition to "sale pending", "under contract" or "contract pending" signs. Needless to tell you she does not like it. I looked it up and that FRESH FREC decision is real, indeed [61J2-10.035].

Some other findings:

475.175(1)(a) allows "electronically authenticated applications"-re RE agents- and requires that "fingerprints" be provided in electronic format after July 1,2006.

As of now, electronically endorsed contracts are legally enforceable. An electronic signature can be attached to a contract and eliminates the need to write and sign on paper certain contracts and other documents. Microsoft, Fannie Mae, Countrywide Home Loans and other corporations are working to "finish" the implementation of such transactions and make them commonplace.

475.278(1)(b) Establishes the "presumption" that all RE agents operate as "transaction brokers"- or work for the contract-, unless a single agent or no brokerage relationship is established in writing with a consumer.

Very interesting things:

The Commisssion must promptly report to the proper prosecuting agencies any criminal violation of any statute....

A 'handyman" can work for a homeowner if the work to be done takes $1,000 or less, including the cost of materials. If the expenses are more, the homeowner is required to hire a contractor, or the services of a RE licensee if less than $5,000. Hiring a contractor is always mandatory if the job takes more than $5,000 (including cost of materials). A "handyman" job will be closely monitored to prevent him from making separate small jobs to evade this rule.

To be paid from the Florida Real Estate Recovery Fund, a consumer must have received a final judgement from a Florida civil court against an individual broker or sales associate and NOT A CORPORATION OR PARTNERSHIP.

The Florida Condominium Act establishes that apartments can be bought, sold, leased, or mortgaged. The owner of any unit owns his or her own unit, PLUS AN INDIVIDED ONE-FITH SHARE OF THE ELEVATOR, LOBBY GROUNDS, AND STRUCTURE. REAL ESTATE TAXES ARE SEPARATELY ASSESED ON EACH UNIT, taking into account the added footage.

Also, on condominiums, the FREC allows associations to ban rentals on any unit in the property, or set a minimum period for leasing or prohibit renting during the first years of ownership.

AGENCY LAW or the MOST OUTRAGEOUS changes:

Besides the "presumption" above cited, the following relationships may exist:

Single Agency- The agent owes loyalty, obedience, confidentiality, etc., to the principal; but THE PRINCIPAL IS RESPONSIBLE FOR THE ACTS OF HIS SINGLE AGENT. It does not need a written contract or compensation for it to exist. However, the agent is required to give a notice to the principal. If the principal refuses to sign a Single Agency Notice, the licensee may still work as a single agent for that person, but should note on the form that the principal declined to sign.

A single agent may transition to a "Transaction Broker" to facilitate the sale (or contract). At that very moment, the agent owes "limited confidentiality" to his principal.

Transaction Broker- A notice should be given to the customer that the agent is working for the contract only (so the sale can take place). Again, if the customer refuses to sign it the licensee may still work as Transaction Broker only for THAT customer; but should note that the sustomer declined to sign.
Often, licensees offer Single Agency and Transaction Brokers notices to the consumers when they first met, for the convenience to have those notices already signed in advance. The licensee, then, may change hats as needed to facilitate the transaction to be (this provision is worded in a different way by FREC)

The transaction broker notice requirement will be deleted in 2008 because of the presumption that all RE agents are transaction brokers. The delay in deleting the form is to give the public time to become aware of the change.

The American Nightmare at its best. My opinion.