A Review of the Florida Estoppel Law Six Months Later

It’s been more than six months since the Florida legislature passed new laws governing homeowners associations and condo associations. We work with both title agents and these associations to make the estoppel requesting process as seamless as possible for both parties.  Title professionals have seen the benefit (and some new challenges) as a result of the changing regulations.

The changes, which went into effect July 1, were highly anticipated by real estate and title agents alike. One of the benefits of the new rule is that it requires associations to deliver the estoppel sooner than before. Now an association must deliver the documents electronically within 10 days, or within 15 days via mail. Previously, the association had 15 days to get the estoppel back. Most organizations are able to meet this new turnaround deadline, however, on the rare occasion they do not meet that deadline, one is able to get a refund for the cost of the estoppel.

Another perk of the law is that you are more likely to get all the information needed the first time you request an estoppel. Before the law changed, there was no regulation on what information the association had to send back, often people that order estoppels would have to go back and forth, requesting all the pieces of information needed for closing. Ultimately, this awkwardness meant it took much longer to get the full estoppel turned around and now that doesn’t happen much anymore.

When the new law went into effect, real estate and title agents were most excited about the new cap imposed on associations for estoppel fees. Formerly an association could charge whatever they felt appropriate to prepare an estoppel, and in certain counties in Florida, some were charging upwards of $500. The new law capped the amount to $250, which was great news for those who were used to paying exorbitant fees. However, some associations that used to charge less actually raised their prices. Likely this is because it costs them more to prepare the documents within the shorter turnaround time requirements. Experts also noticed that associations were more likely to take advantage of a provision that allows them to charge $150 more for the estoppel when there are delinquent fees on the property in question. They say even if that property or unit is just $1 delinquent, they see this extra fee slapped on top of the $250.

Despite a few new challenges on both sides, as a facilitator between associations and closing agents, we’ve seen an improvement when it comes getting an estoppel for a real estate closing. Associations have a clearer understanding of what is expected of them and agents are getting what they need in a more timely manner.

Amanda Farrell