You’ve probably come across the phrase ‘as is’ when scanning used car websites or craigslist descriptions. In this context, it usually means that the car or item is being sold in its current condition and if you buy it, you accept it with all faults, even those not readily apparent.
With real estate, it’s different. Although many people believe that a property sold ‘as is’ must be accepted regardless of the condition, nothing could be further from the truth. In this blog, we explain the concept of ‘as is’ in a Florida real estate transaction and how working with an attorney can help ensure a successful result.
‘As Is’ in Real Estate
‘As is’ does not mean that a buyer waives their inspection contingency rights. (In other words, they will buy a property regardless of what the inspections uncover.) Rather, the phrase means that the general condition of the property is already accounted for in the sale price and the seller will not address any inspection issues that might arise, either by repairing the deficiencies or providing a credit.
A buyer who discovers significant structural, mechanical, or environmental issues with a property after certain inspections has the option of simply taking it in its present condition or bowing out of the sale. Although you can certainly make requests for repairs, pest extermination, and other corrective measures for a defective property, your latitude for doing so is limited and the seller doesn’t have to comply.
Contract Language for ‘As Is’ Sales in Florida
Buying or selling a home ‘as is’ in Florida requires the use of a specific form stating that the buyer will assume responsibility for making any necessary repairs to the property. Most contracts contain language detailing the amount the seller has agreed to pay for repairs; with an ‘as is’ form, this stipulation is absent. Instead, the form states that:
- The agreement is subject to a pre-purchase inspection. If the buyer decides to go ahead with the sale afterward, they are on their own.
- If the buyer’s lender wants any repairs carried out, the buyer must cover the costs. In a conventional sale, both sides would typically enter into negotiations after discovering a significant issue.
Why Sell a Property ‘As Is?’
Houses are often listed ‘as is’ when sellers need to get rid of them quickly. This usually means they are in financial difficulty or a major life event has forced them to move. With this type of sale, they can avoid much of the work usually associated with selling a house, such as repairing it and doing renovations. A trade-off is that the seller will earn less from the sale and may have difficulty attracting buyers.
What is a FAR/BAR ‘As Is’ Contract?
FAR/BAR ‘as is’ contracts are approved by the Florida Association of Realtors and the Florida Bar Association. The FAR/BAR has specific forms that Florida buyers and sellers use for these real estate transactions. Common provisions include:
- Address and legal description/parcel identification number of the property to be purchased
- A list of fixtures, appliances, and other items included in the sale
- Amounts and due dates for payments
- Closing and occupancy dates
- Timelines and contingencies for inspections, financing, and title searches
A Florida Real Estate Lawyer Can Help
‘As is’ property sales can be beneficial for both buyer and seller but like any transaction, input from a Florida real estate attorney can help ensure that the contract meets your needs and protects your interests. To speak to an experienced professional at Salas Law Firm, call (954) 420-6406 today.