Transfer/Screening Fees and Security Deposits

Condominium associations are limited by statute on the amount of fees which can be charged in connection with the transfer of a unit. 

The condominium association must have the right in its governing documents to approve a sale, mortgage, lease, sublease, or other transfer of a unit, in order to charge a fee in connection with such transfer. In addition, Section 718.112(2)(i), Florida Statutes provides that no such fee shall exceed $100 per applicant other than husband/wife or parent/dependent child, which are considered one applicant. This $100 state-mandated cap includes all non-refundable fees charged for interviews, background checks, credit reports, and other costs when people seek to buy or lease a condominium unit in Florida.

This transfer fee should not be confused with a security deposit which may be required, in addition to the transfer fee, if the authority to do so appears in the declaration or bylaws. The amount of the security deposit is also subject to statutory limitations. Section 718.112(2)(i), Florida Statutes provides that an association may, if the authority to do so appears in the declaration or bylaws, require that a prospective lessee place a security deposit, in an amount not to exceed the equivalent of one month’s rent, into an escrow account maintained by the association. This security deposit is intended to protect against damages to the common elements or association property.

A security deposit is to be held by the association and returned to the tenant when the lease is up if the common elements were not damaged by the tenant.

What Happens When A Buyer Discovers Condo Water Damage After Closing?

Water damage can be an easy repair or a major financial expense. It can even become a health hazard (mold) if left undiscovered for a long enough period of time.

Buyers of Florida condos should also know that there are Florida laws in place that protects them from hidden defects (defects that the seller knew about or should have known about) like water leaks and other water related issues. Buyers should also know that any claim they may have not only extends to the seller but also extends to the real estate agent and their real estate broker. See, Johnson v. Davis, 480 So.2d 625 (Fla. 1985) and Florida Statute 689.261.

It is also very important to do the necessary due diligence and inspections during the diligence period and prior to closing. Obtaining the seller’s disclosure is also essential. We suggest always contacting counsel prior to the purchase of a condo.