There is an old proverb that says: “Every cloud has a silver lining.” The same may be true when it comes to Florida’s condominium market.

For many years, we looked on as the market grew. While new communities were being developed on nearly every corner, the trend of converting apartments to single-family condo units also picked up steam.

There are several factors, including low interest rates and high demand that contributed to the phenomena we witnessed. But many of those same factors are responsible for the condition of the market today.

Despite the doom and gloom, there is a possible silver lining. The market’s oversupply benefits future condo buyers. There is a huge selection of units to choose from, so you are more likely to find what you are looking for. And, as the prices continue to fall daily, you are almost guaranteed a bargain.

If you are able to buy, now is a good time to secure that single condo unit (or invest in an entire community).

Do you have any silver linings you want to share? Add them in the comments section below.

In April 2010, a report by LexisNexis Mortgage Asset Research Institute indicated Florida had the most cases of mortgage fraud in the nation.

In June, 86 South Floridians were arrested for falsifying documents to secure fraudulent loans, which resulted in a loss of nearly $80 million.

And according to the SFBJ, “last week, four area residents pleaded guilty to participating in a $2.5 million mortgage fraud ring. A week earlier, a former attorney and three mortgage brokers were charged in a $6 million scam. That same week, a Miami federal jury found two women guilty in a $21 million mortgage fraud scheme.”

A recent report from MortgageDaily.com shows that the state no longer has the highest rate of mortgage fraud in the nation and is second to California with nearly $436 million in claims filed.

What is Florida doing to Protect Homeowners?

Attorney General Bill McCollum has taken aggressive action to cut down mortgage and foreclosure fraud in the state.

In 2007, he started the Mortgage Fraud Task Force and has since reached out to state agencies, law enforcement, and attorneys for help developing a collective approach to protect Florida homeowners.

Since 2007, the task force has reviewed the practices of more than 200 foreclosure rescue businesses, and is presently handling more than 50 active investigations and a few pending lawsuits.

If you feel you have been wronged or taken advantage of by a foreclosure rescue company, you will be happy to know the Attorney General’s office has streamlined the process for reporting incidents of fraud. You can now submit complaints using this online form.

Other mortgage fraud resources include:

Attorney General of Florida
Consumer Protection
The Capitol PL-01
Tallahassee, FL 32399-1050
Phone: (850) 414-3300
Consumer Hotline: (866) 966-7226
Web: http://myfloridalegal.com/consumer

Florida Department of Business and Professional Regulation
Division of Real Estate
Consumer Complaints Section
400 West Robinson Street, Suite N801
Orlando, FL 32801-1757
Phone: (850) 487-1395
Email: Call.Center@dbpr.state.fl.us
Web: http://www.myflorida.com

FBI Field Offices

Miami Division
White Collar Crime Program
16320 NW 2nd Avenue
North Miami Beach, FL 33169-6508
Phone: (305) 944-9101
Email: miami@ic.fbi.gov
Web: http://miami.fbi.gov/

Tampa Division
White Collar Crime Supervisor
5525 W. Gray Street
Tampa, FL 33609
Phone: (813) 253-1000
Email: tampa.division@ic.fbi.gov
Web: http://tampa.fbi.gov/

U.S. Department of Housing and Urban Development (HUD)

Miami Field Office
Brickell Plaza Federal Bldg.
909 SE First Avenue
Miami, FL 33131
Phone: (305) 536-5678
Email: FL_Webmanager@hud.gov
Web: http://www.hud.gov

Tampa Field Office
500 E. Zack Street, Suite 402
Tampa, FL 33602-2945
Phone: (813) 228-2026

Do you have questions for our Fort Lauderdale real estate lawyers? You can email our firm or give us a call at (954) 779-7009.

Since 1984, Buy Owner has helped homeowners advertise and sell their homes in exchange for a fee. The broker-free system has reduced costs for many homeowners but as the market continues to struggle, the company is forced to liquidate to keep its doors open.

While its located in Deerfield Beach, the company has franchises in Jacksonville, Orlando and Tampa, Florida as well as outside of the state.

It is estimated Buy Owner owes nearly $4 million to Bank of America, and more than $1 million to company executives and shareholders.

The Miami Herald is reporting…

The company filed last month for an assignment for the benefit of creditors in Broward County, which is similar to Chapter 7 federal bankruptcy but in state court.

As assignee, Fort Lauderdale-based Michael Moecker & Associates is responsible for maximizing the assets of the company so creditors can get paid.

Von Kahle said the combination of a down real estate market and a large Bank of America loan that recently required payment led to the liquidation filing.

Despite the financial problems, the company plans to remain open but with a smaller staff to help homeowners that are trying to sell.

If you don’t want to navigate the real estate process alone, contact our Fort Lauderdale lawyers. You can use this form to email or call us at (954) 779-7009.

Source: The Miami Herald

The leasing process starts with your search for a property that meets your business needs. There are many types of real estate located in prime locations throughout Florida for you to choose from.

Finding Commercial Real Estate to Lease

South Florida’s commercial market remains oversaturated with office spaces, storefronts and warehouses. You can find great bargains but there are a few things you will want to consider when searching for the “right” property.

1.    Budget

An essential first step in the process is setting a budget. What you can afford will play a significant role in determining the location and type of real estate you can lease. If you set a budget early on (even if it’s only a range), you will be clearer about what you are searching for and save yourself time in the long run.

2.    Location

Consider your customer base when researching locations that may be a good fit for your company and the products and services you offer. Ask these questions with regards to potential locations:

• Is this location suitable for my business?
• Is this location convenient for my customers?
• Is this location convenient for my staff?

3.    Type of Commercial Real Estate

Nowadays, there is no shortage of commercial real estate in South Florida. Decide whether you need to lease a retail storefront, warehouse or office space.

A commercial real estate lease usually involves more time, research, money and other resources. The budget, location and type of real estate you choose for your business are essential.

Once you find the “right” property, enter into a lease agreement with the landlord to seal the deal.

Contact our real estate lawyers for help finding and securing commercial real estate for your business.

This event follows reports that show Fannie Mae lost approximately $3 billion from April to June 2010, and its new request for “bail out money” from the government.

There will be two auctions held to sell 100 homes in Miami-Dade, Broward and Palm Beach counties. The auctions are geared towards homebuyers that are looking for properties to live in, not property investors, and are invitation only.

The first will begin at 9:30am and will cater only to individuals and families that plan to use public funds towards their home purchases. This includes individuals that will receive down payment assistance from the housing authority.

The second auction will start at 12:30pm and will be open to all bidders but under one condition – the homebuyer must commit to live in the home.

Real Estate Disposition, LLC is working with Fannie Mae to coordinate and manage the auctions. The pair teamed up before in Phoenix, Arizona where they successfully auctioned off 85 properties and generated $2.95 million during the first community auction.

“Fannie Mae owns or guarantees about half of all U.S. mortgages, or nearly 31 million home loans worth more than $5 trillion.” The company hopes to auction off as many properties as possible in the South Florida area.

If tomorrow’s events are successful, we can probably expect more auctions in other states across the US in the coming months.

If you need help finding and buying a home in South Florida or you have questions about the process, contact our Fort Lauderdale real estate lawyers.

Source: FannieMae.com

Photo credit: Cafemama

In most cases, if the homeowner is willing and able to bring his/her mortgage current, the lender is eager to stop the proceedings and allow him/her an opportunity to stay in the home.

However, sometimes the owner cannot afford to keep the property and must sell as quickly as possible. Here’s why you may want to consider buying a pre foreclosure:

Price

Pricing is a major benefit of buying a pre foreclosure. In most instances, because the homeowner is forced to sell the property to prevent losing it, he/she will consider prices that are substantially lower than the actual value. It is not unusual to find pre foreclosures at half (or less) of their value.

Timing

Florida’s real estate market remains saturated and there is a huge supply of pending foreclosures. If you are able to get a loan, now may be a great time to buy prime, upscale real estate at a fraction of it’s worth as homeowners continue to drop prices.

Negotiate with Property Owner

You can negotiate directly with the property owner when you’re buying a pre foreclosure. This gives you an advantage. You have leverage to negotiate a good deal and the owner has an incentive to sell the property fast to prevent foreclosure.

To begin your search, you can start in the same places you’d look for foreclosures. Search the Internet, read your local newspapers, and visit the foreclosure courts in your area.

If you need help finding and buying a property – or you have questions, contact our Fort Lauderdale real estate lawyers.

From April to June 2010, about 14,500 foreclosure actions were filed in the Florida courts, but only a percentage of those properties are inhabited by the homeowners.

Others that remain vacant may be promising opportunities for investors or families looking to move.

The foreclosure process can take months to complete and with the current backlog, it may take longer.

In some cases, the lender and homeowner must sit for mediation in hopes of avoiding the foreclosure. And although the goal is to mediate within 120 days, that doesn’t always happen. If the two sides cannot reach an agreement, the process continues until the lender succeeds at repossessing the property. A judgment is then entered and the foreclosure sale is scheduled.

If you have thought about buying another home, now is a good time to consider foreclosures. (Perhaps it’s great timing to buy into that upscale community you love!)

You don’t have to wait to buy from the banks. You can buy your dream home and at a fraction of its actual value.

If you are a property investor, upscale foreclosures are a good way to diversify your real estate portfolio.

Like most investors, you want to buy properties that will increase in value and be worth more than you paid when you’re ready to sell. If you find the right foreclosure at a good price and in a nice community, when the market rebounds you can sell it for significantly more than you paid.

Or you can rent the property as there is a demand for rentals throughout the South Florida area.

Are you looking to relocate? Have you considered buying a foreclosure?

Before you start your search, contact our real estate lawyers for help finding foreclosures in upscale communities.

Image credit: EPI Photography

In the second quarter of 2010, RealtyTrac – a California based research firm – reports that Florida is rated the 10th highest for foreclosures, in the company of Arizona, California and Nevada.

The Miami metropolitan area alone has nearly 4 percent of its homes in the foreclosure process, and Orlando is rated 8th in the nation.

Dealing with massive backlogs

The Florida courts have been overwhelmed trying to deal with a massive backlog of cases.

Broward County is currently seeing approximately 500 new foreclosure cases filed each week. Of those, more than one-third are not occupied by homeowners and remain vacant and susceptible to vandalism.

The county recently introduced mandatory mediation in hopes of thinning out its backlog of more than 50,000 cases. Palm Beach later followed suit and started a mediation program of its own.

Thanks to a mandate passed by Florida’s Supreme Court, you can expect more state courts to institute mediation programs similar to Broward County’s. However, the mediation programs are mandated for homes that owners reside in and not investment properties.

While lenders cannot be forced to restructure home loans, they are encouraged to communicate and hopefully reach an agreement that allows the homeowner to remain in the property.

Is the market recovering?

Despite the seemingly dismal news, a recent report by Condo Vultures indicates that the current foreclosure rate in South Florida is down nearly 50% compared to this time last year.

From April to June of 2009, banks commenced more than 28,000 foreclosure actions, compared to approximately 14,500 from April to June of 2010, according to the report.

The drop in foreclosure filings can be attributed to two primary factors. One, the costs associated with repossessing a property versus a short sale, is significantly more. Lenders are more inclined to agree to short sales whenever possible.

Two, the recent law changes mandating mediation of properties under homestead exemption has increased the time necessary to complete the foreclosure process because lenders now have to work with homeowners. The process that once took a couple of months to complete, can now take several months to years to finalize.

If you are dealing with foreclosure, contact our real estate lawyers today. You can use this form to email or call us at (954) 779-7009.

Sources: Realty Trac, Condo Vultures

ILSA is based on the full disclosure provisions and philosophy of the Securities Act of 1933.  The underlying purpose of both acts is that prior to the purchase the buyer must be informed of facts which would enable a reasonably prudent individual to make an informed decision about purchasing the security or the property.

As discussed, developers can obtain exemptions for certain properties that fall under the exemption rules of ILSA.

Lets discuss two of those rules:

• the 100 lot exemption rule
• the two year exemption rule

100 lot Exemption Rule

Under the 100-lot exemption, the sales of lots in a subdivision containing fewer than 100 lots – which are not already exempt under section 1702(a) – are exempt from ILSA’s registration and disclosure requirements.

The developer is also required to provide the buyer with a written Property Report to disclose pertinent information about the property before the Purchase and Sales Agreement is executed.

If the developer fails to provide the buyer with a written Property Report for non-exempt property and accepts a signed contract, the buyer can later rescind the contract and seek a refund of any monies deposited.

Two Year Exemption Rule

The 100-lot exemption is only one of several that are provided under the ILSA.  Another common exemption is the two-year exemption.

Under the two-year exemption, where the contract obligates the seller to erect the building within a period of two years, then the transaction can be exempt from ILSA’s requirements.

As it relates to the exemptions provided to sellers under ILSA, it is important to note that the exemptions are not without qualification, and are not applicable where it can be shown that the method of disposition of the property was adopted for the purpose of evading the requirements of ILSA.

Also, where a contract does obligate the developer to complete construction within two years, and the developer fails to complete construction within that time frame, the buyer can seek remedies to rescind the contract and request a refund of any deposits paid.

Florida Case Law

In the case of Kabula v. Southern Homes of Homestead VIII, Inc., 2008 WL 2741154 (S.D. Fla. 2008) the Southern District of Florida addressed the two year rule.

Kabula signed a contract to purchase a condominium while the unit was still under construction. The contract gave the developer 30 months to complete the condominium. The contract also included a “Savings Clause” that stated any contract provisions that conflict with the ILSA were void.

The developer contended that because the Savings Clause invalidated the 30 month building requirement, the condominium fell under the two year exemption rule.

The court disagreed with the developer and ruled that the developer could not rely upon “a savings clause to exonerate itself from running afoul of ILSFDA requirements in hypothetically limitless ways.”

Is your property covered by one of these exemptions? Contact our real estate lawyers today. You can use this form to email or call us at (954) 779-7009.

As mentioned in the previous article, the Interstate Land Sales Full Disclosure Act (ILSFDA) was put in place to protect you from a number of issues related to property purchases. This includes:

1) False, misleading promises made by the developer to convince you to sign a purchase agreement;

2) Failure to complete construction of the condo within the time allowed by the contract; and

3) Fraudulent actions committed by the developer in violation of ILSFDA.

While a major purpose of ILSFDA is to protect buyers, there are also instances where the developer’s property is exempt from the regulations of ILSFDA.

The Florida courts have addressed the issue of exemption on numerous occasions – recently in Lewis and Lori Gold v. 200 East Partners, LLC.

In 2008, Lewis and Lori Gold signed an agreement to purchase a condominium unit in the 200 East Palmetto Park community.

The building was still under construction when the contract was signed and was set to contain 115 residential units.  The condominium project fell under the requirements of ILSFDA as interstate commerce and mail was used to advertise and sale the units.

The developer sought exemption for the first 99 units, and later built the remaining condominiums – which did not fall under the exemption rule.

According to the ILSFDA, if the property does not fall under the exemption rule, the developer must provide the buyer with a written property report prior to the signing of the purchase agreement.

In Golds, the court decided that because the developer did not perfect an exemption for the lot prior to execution of the contract, and failed to provide the Golds with a printed property report, it violated the ILSFDA. The Golds were able to get out of the contract to purchase and received a refund of their deposit.

Does your condominium fall under the exemption rule of ILSFDA?

Contact our real estate lawyers today. You can use this form to email or call us at (954) 779-7009.

Image credit: arnet117