I knew you're probably tired of hearing about it, but the insurance crisis is rearing its ugly head again. If you own a condo, pay attention! As we all know, policies for condo associations are being cancelled at an alarming rate. A master policy that used to cost $35,000 will now run your association, let's say $100,000. Let's assume for an example that there are 50 units in your complex. Simple math results in a $2,000 assessment. Not bad. Let's also say your condo board assesses the total of $2,000 per unit and allows you to pay it over four monthly installments. That's not bad either. Now, let's say you paid the first two installments and now you have sold the unit. Whose responsibility is it to pay the balance, which would be due after the closing of your sale, the seller or the buyer?
I had a lively discussion with a legal mind pertaining to this subject (problem). His strong opinion was that the balance was the buyer's responsibility. Naturally, being the brilliant mind that I am, I disagreed. Here's the bottom line.
If an assessment of ANY kind is voted on and ratified by the board and/or the majority of the unit owners, that assessment, according to Florida Statutes is the responsibility of the seller. The law does not state nor does it contain a provision on the method of payment. Ex: lump sum or a payment schedule. Please do not confuse this with a pending assessment. A pending assessment is something not yet decided or ratified. Therefore, there is no assessment even though there is common knowledge that one may be coming.
If you are a seller, it would be wise to consider these facts when you draw up a contract of sale, so as to avoid a blow up at the closing table. Assessments will become an integral and sticky part of a sales contract from this day forward.
Needless to say - I won both my arguments.
Ric Cornelius is the Broker/Manager of Sand Key Realty Sales and Rentals, Inc. Sand Key Realty has three offices with 40 agents. One office is at 740 S. Gulfview Blvd., Clearwater Beach, 727-443-0032; the second office is at 2701 Gulf Blvd., Indian Rocks Beach, 727-595-5441; and the third office is at 309 Belleview Blvd., Belleair, 727-461-4200.