- June 26, 2017
- All Florida Issuing Offices
- UNDERWRITING - SB 398 Estoppel Certificates
The Estoppel Reform Bill, SB 398, has been signed by the governor and will take effect on July 1, 2017. This new law was a legislative priority of the title insurance industry for the past three years and it is expected to facilitate the process of obtaining estoppel letters from condominium cooperatives and homeowner’s associations. It amends portions of Section 718.116 (condominiums) 719.108 (cooperatives) and 720.30851 (homeowner's associations), Florida Statutes. The highlights are as follows:
1. The association must issue and deliver the estoppel certificate within 10 business days of receiving a written or electronic request. If the association does not meet this deadline they may not charge a fee for the preparation or delivery of the estoppel certificate.
2. Each association must designate on its website a person or entity with a street or e-mail address to receive the request.
3. The statute mandates the information which must be contained in the estoppel certificate. (See attached form)
4. An estoppel certificate that is hand delivered or sent by electronic means has a 30-day effective period. One sent by regular mail is effective for 35 days. If the association realizes that it provided incorrect information, it may send out an amended estoppel certificate if the sale or refinancing of the unit has not yet been completed. A fee may not be charged for the amended certificate and the effective period starts over from the date of delivery.
5. The association waives the right to collect any sums owed in excess of the amounts specified in the estoppel certificate from any person and that person’s successors and assigns who in good faith relied on the estoppel certificate.
6. Provided there are not any delinquent fees owed by the association for the unit, the association or its authorized agent may not charge more than $250.00 for the preparation and delivery of the estoppel certificate for a single unit. The association may charge an additional $150.00 if there are delinquent fees owed. If the estoppel certificate is requested on an expedited basis and is delivered within 3 days of the request, the association may charge an additional $100.00. The statue provides a schedule of the allowable fees if the request for an estoppel certificate applies to multiple units owned by the same seller. All fees established by this bill are subject to revision after five years based upon changes in the consumer price index.
7. If the transaction does not occur within 30 days after the scheduled closing date and the preparer of the certificate receives a written request for a refund accompanied by reasonable documentation, the fee must be refunded. This right to reimbursement may not be waived or modified by any contract or agreement.
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THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.
- Bulletins Replaced:
- Related Bulletins:
- FL2014004 UNDERWRITING - Policy Surcharge
- Underwriting Manual:
- Exceptions Manual: