Information on COVID-19 Addendum to Contract From Florida Realtors (March 20, 2020) - YouTube

Margy Grant: On March 18th, Florida Realtors released the COVID 19 addendum to contract.

The Florida Realtors legal team wants to make sure you have all of the information you need to

successfully complete contracts that are in place, or are to be executed.

Joining me is Florida Realtors General Counsel Juana Watkins. Juana, what forms can the members use this addendum with?

JUANA WATKINS: Members can use this addendum with all of the existing sale and purchase contracts in our current forms library.

MARGY GRANT: And the most popular purchase contract that is in use with the members right now is?

JUANA WATKINS: The most popular form is the As Is Contract that is a part of the Florida Realtors Florida Bar family of contracts.

MARGY GRANT: And you all will know, that we call that lovingly the FAR BAR. We are Florida Realtors,

but the membership uses that term very easily. So, if you're wondering, the contract you probably are using,

is the FAR BAR, or the FAR BAR As Is contract. If you're in a part of our state that uses another kind of form,

like maybe the CRSP, that's also a Florida Realtors purchase contract, it's just not used as often as the other one.

So Juana this addendum, is it intended for a contract that's currently in place between a buyer and a seller, or a new deal?

JUANA WATKINS: This contract was really designed to be used, to extend the timeframes under an existing sale and purchase contract.

MARGY GRANT: If I’m executing a new contract, should I use the addendum?

JUANA WATKINS: It's not designed for that purpose, but there are portions of the form that might be useful,

specifically the second portion of the form that deals with complications related to the buyer's financing.

That could be used to extend or to provide buyers some additional protections in the event that the lender does not fund the loan.

MARGY GRANT: So, unfortunately the experts can't tell us how long this crisis is going to go on for,

so this is a tool that will be used ongoing until we're through it.

JUANA WATKINS: Absolutely. And so the parties should be really mindful in terms of how they extend the dates.

The contract gives you the option to either enter a fixed date or to enter a specified number of days.

What you place in that section will depend on really the conditions on the ground at the time that you're executing this addendum.

So speak with the buyer and seller and either pick a fixed date, or a number of days that works with their unique circumstances.

MARGY GRANT: So, when they're counting their days, for the FAR BAR contract or the As Is Contract, is it business days or is it calendar days?

JUANA WATKINS: This is a really important question. The contracts all read slightly different with respect to how time is calculated.

Some contracts say business days, some contracts say calendar days.

Additionally, there are some provisions that will provide that for a shorter period of time, you would use a different calculation.

Or, sometimes the deadline will fall on a Saturday, Sunday or legal holiday.

And, in all instances, if the parties want to extend, rely on the underlying language in the contract that the parties originally executed.

So for instance, if you're dealing with the CRSP contract, you would look at paragraph 11B to tell you how to calculate dates.

If you're dealing with the contract, the As Is, or the Florida Realtor Florida Bar contract, please rely on the calculation in Standard F.

For the Vacant Land Contract rely on paragraph 11.

And for the Commercial contract, please rely on paragraph three.

MARGY GRANT: Juana, the last paragraph of the addendum is unique. It says that the lender might not fund an already approved loan. What does that mean?

JUANA WATKINS: We drafted this language, hoping to not penalize buyers who have been approved for a loan,

and are proceeding to closing with good faith, trying to satisfy the conditions, but a lender decides for business purposes to not fund,

or if a buyer, let's say loses their job during the time of this crisis,

we didn't want the buyer to be unfairly penalized because of circumstances that were beyond their control.

MARGY GRANT: Juana, when you're using the forms in the library, there's another, regular extension.

Is there ever a time that folks should be using the regular extension versus the Covid extension?

JUANA WATKINS: Yes. These forms look very similar so, you have to work with the buyer and the seller to decide which one works for them,

the Covid restriction form is designed to address circumstances or complications in the transaction,

specific to the Covid 19 crisis. The regular extension addendum to contract form should be used if the

parties need an extension of time that is not related to any complication due to Covid 19 or perhaps if

the parties want to address extending the timeframe for an obligation under the contract that has already passed.

MARGY GRANT: Juana, how do you use this addendum if a homeowner's association or a condo association refuses to timely approve a buyer?

JUANA WATKINS: So if you look at the definition of Covid restriction, it covers actions or inactions of an association.

If the association will not be able to timely approve the buyer because of Covid 19 issues,

then the parties can elect to extend that timeframe by selecting the last check box on the form,

and entering a new date or new number of days for approval.

MARGY GRANT: These are the most common questions we've received with regard to the newly published addendum.

If you have additional questions, please contact the Florida Realtors Legal Hotline, the Florida Realtors Tech Helpline

is also available to any of you who are now working from home.

We know that this is an extremely stressful time, and we wish all of you health and wellbeing.