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Estoppels, which are most commonly known as Homeowners' Association (HOA) dues letters or certificates in other states, are a necessary part of closing on a home in an HOA in Florida, and they can be a huge pain to retrieve in a timely and affordable manner. Real estate and title agents have longed for a way to reel in the management companies that charge hundreds of dollars for preparing simple documentation on current and outstanding assessments owed to condo and homeowner’s associations.

In Florida, Senate Bill 398 was passed on July 1st in an effort to cap exorbitant fees and streamline the process of requesting estoppel letters. This legislation has been a holy grail for real estate and title agents for some time.

After several weeks of implementation, I wanted to know how successful the new Florida HOA law has been in achieving those goals.

I spoke to Amber Murphy, one of our senior property analysts who works with associations. She explained how the new law has helped in some ways, but also caused some issues.

 The Cap of Fees

The new law caps the fee for an association dues letter or certification request at $250. However, some management companies are adding on mysterious “online misc” fees of anywhere from $5-50. Additionally, if there are delinquent amounts owed, the association may charge an additional max fee of $150 for that information. A "delinquent amount" could be as low as a dollar.

There is also a $100 fee for “expedited” requests.

All in all, the law requires a maximum of $500 for an expedited, delinquent estoppel certificate from just one association. The unfortunate side effect of this required cap has been that management companies that didn’t previously have exorbitant fees are now raising their prices. One company is now charging the full price for documents simply stating if there is a pass-through from a sub-association to the master association when this information was given at no charge before the law took effect.

 The Turnaround Times

An estoppel letter must be electronically delivered within 10 days or by mail within 15 days of the request or the association must refund the amount as well as deliver the estoppel letter. The only problem is that many management companies cash the check upon receiving it. The management company will often point fingers at the association and vice versa when a requester calls about the entitled refund. This runaround can be a huge headache for a title agent when the deadline for a closing is fast approaching. Fortunately, our analysts are trained to deal with these kinds of issues and deliver the information as quickly as possible.

Thinking of outsourcing Association Requests? Download our Cheat Sheet to help you decide.

 The Required Information

So far, this has been the one area with the least issues for our analysts. Most management companies and associations have typically included all information valid for 30 days despite there being one or two that refuse to include an itemized list of special assessments, capital contributions, etc. Again, our senior analysts are trained to deal with companies that do not adhere to the law in a friendly and firm manner to ensure our clients have all pertinent information for their closing.

 Requesting a Refund

If a real estate deal falls through, the association, by law, is required to refund the initial fee paid for the HOA letter. Unfortunately, many associations think they can skirt this law and avoid refunding the fee in this situation. We took a management company to court over the matter of a refund and won.

Retrieving a Condo or HOA dues letter is an imperative part of the title commitment and real estate due diligence. Let us know what your experience with requesting association certificates has been like since the law was passed. If you’re looking for any additional support for your closings, we’re here as a due diligence partner so you can focus on your clients and their closing while we deal with any issues that arise from requesting association letters or certificates.


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