The days of unreasonable estoppel certificate fees are finally over, but new laws sometimes take time to achieve broad public awareness.
The changes to estoppel certificates, which went into effect July 1, 2017, cap the fees that community association management companies can charge for the certificates at $250 for unit owners who are current in their assessments. An additional $100 can be charged for "expedited" estoppel certificates (delivered within three business days), and another $150 can be charged for owners who are delinquent in their assessments. This is a maximum of $500 for an expedited, delinquent estoppel certificate.
The new law also requires certificates to be delivered within 10 business days and remain valid for 30 days. It also standardizes the information each certificate must include so that each estoppel contains the same information. There are also new fee caps for bulk buyers where the maximum fee decreases as the number of purchased properties increases.
An estoppel certificate provides a snapshot of the fees or assessments that a seller may owe to their community association and is provided by the association or management company when a property is being sold. Prior to the new law, associations could charge a "reasonable" fee to prepare an estoppel certificate, but without any context on what the word reasonable means, some association management companies were charging very unreasonable fees.
The enactment of this new law completes a multi-year effort by Florida Realtors to reign in unreasonable estoppel certificate fees.
Aritcle by Tom Butler, Reprinted with permission Florida Realtors. All rights reserved. © 2017 Florida Realtors