Say adios to the real estate contracts you knew, because the coronavirus is now impacting the contracts drawn between the seller and buyer in South Florida. So, what’s next?
For eons, real estate contracts have included provisions dubbed—force majeure clause—which protects seller and buyer from natural disasters. For instance, earthquakes, hurricanes and tornadoes, among a slew of others. But it never occurred to brilliant legal minds to include pandemic verbiage…until now. The Pandemic is changing real estate sales contracts and The shift looks permanent, for good reason.
Since March, it has become a standard for residential realtors to work alongside attorneys to update sales contracts and draft new ones. Specifically, to incorporate the a “COVID rider” as a reason for contract cancellation. This provision has been added to both existing contracts and new sales. Foreseeing potential issues caused by COVID-19, our firm has been including Pandemic addendum since February.
Best part? This pandemic provision protects both buyer and seller. If you’re a buyer, you’ll have more time to wrap up tasks, such as finalizing lending or completing inspections. As far as sellers, you’re covered too. This clause is legally binding. If a buyer backs out after all mortgage, appraisal and inspection contingencies have been all completed in accordance with the Covid-19 agreed to extended contingency timelines, then the Buyer may be subject to loosing their earnest deposit if they default. However, the COVID-19 addendum does provide more flexibility in extending these timelines to keep the deal moving forward to the common goal, which is to close. Contact us for more information about the Covid-19 addendum.
See Below Example Provided by the Florida Realtors
“The Coronavirus (COVID-19) pandemic may cause unprecedented impacts to real estate transactions, including but not limited to travel restrictions, self-imposed and/or governmental required isolations, potential closures of offices and institutions required to fund, close and record real estate transactions, and action or inactions of a homeowners’ or condominium association.”
The form includes checkboxes with extension options for:
Which brings us to another question, unrelated to COVID-19, but related to a future real estate contract— “what’s our newest listing?”
Hint: you’re looking at it: 1150 102nd St #PH 705. A stunning 2-bedroom Penthouse with a private rooftop terrace overlooking the dazzling Bay Harbor Islands and intercostal
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