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Florida Real Estate Principles, Practices & Law 39th Edition Unit 7: Federal and State Laws Pertaining to Real Estate Civil Rights Act of 1866 • Prohibits discrimination based on race in all real estate transactions • No exceptions • Jones v. Mayer Supreme Court decision Civil Rights Act of 1964 • Ended racial segregation in schools, workplaces and public accommodations • Prohibits discrimination based on race, color, religion, or national origin in – Public accommodations • Hotels, restaurants, gas stations, places of entertainment – Public facilities: government-run facilities Civil Rights Act of 1968: Fair Housing Act • Title VIII of Civil Rights Act of 1968 – Discrimination is illegal in sales, leasing, advertising sales or rentals, financing, or brokerage services if based on • • • • • Race Color Religion Sex National origin – 1988 amendment added • Handicap (mental or physical) • Familial status Familial and Handicap Status • Familial status – Families with children under 18 and pregnant women • Handicap status – Any physical or mental impairment that interferes with normal life functioning Memory Tool: FRSH CRN (Fresh Corn) • • • • Familial status Race Sex Handicap status • Color • Religion • National origin No Protection Under Fair Housing Act • • • • • Age Occupation Marital status Sexual orientation State or local laws may add additional protected classes Fair Housing Poster • Pledges adherence to the Fair Housing Act • Displayed at real estate brokerage offices, mortgage lender offices • Available free from HUD • Failure to display poster may be used as evidence of discrimination in a complaint Fair Housing Act Covers • Single-family housing – Government owned housing – Privately owned if licensee employed to sell or rent the property – Property owned by person who owns four or more residential units – Owner, during past 2-year period, sells two or more houses (not owner-occupied) Fair Housing Act Covers: • Multifamily housing – Five or more units – Four or fewer units (not owner-occupied) Housing for Older Persons • Exempt from the familial status protection provided – All units are occupied by persons 62 or older; or – At least 80% of the units are occupied by one or more persons 55 or older Transactions Exempted Under the Act • Exemptions apply under two conditions – A real estate licensee is not involved – No discriminatory advertising Exempt Transactions • Seller owns three or fewer single-family dwellings • Seller was not living in the house and was not most recent resident when property was sold or rented (One exempt sale in 24-month period) • Rentals in multifamily dwellings with four or fewer family units and owner lives in one of the units • If racial discrimination, Civil Rights Act of 1866 applies Special Exemptions • Housing operated by religious organizations and private clubs not operated for commercial purposes – Religious organizations may restrict units to members of their religion provided they do not discriminate in accepting membership – Private clubs may restrict units to its members Prohibited Activities • Steering – Channeling homeseekers to or away from neighborhoods • Blockbusting – Using entry or rumor of entry of a protected class to urge owners to sell • Redlining – Denying loans or insurance coverage or different terms and conditions for homes in certain neighborhoods Prohibited Activities • Refuse to rent to, sell to, negotiate with, or deal with a member of a protected class • Quote different terms, conditions, or privileges for buying or renting • Advertise housing is available only to people of a certain race, color, sex, religion, national origin, handicap status, or familial status • Deny membership or use of any real estate service • Make false statements concerning availability of housing for inspection, rent, or sale Enforcement of the Fair Housing Act • Complaints filed with HUD under the Fair Housing Act – One year time limit • Action taken by the Department of Justice • Civil suits filed in Federal District Court • Responsibility and liability of real estate licensees Florida Fair Housing Act • Same 7 protected classes as federal law • Prohibits – Refuse to rent or sell housing – Falsely deny that housing is available for inspection, rental, or sale – Refuse to make a mortgage loan – Impose different conditions or terms on a loan – Threaten, coerce, or intimidate any individual exercising a fair housing right – Refuse reasonable changes to a dwelling to accommodate a disability Americans With Disabilities Act (ADA) • Protects employment and accessibility rights of individuals with mental and physical disabilities • Disabled cannot be denied access to public transportations, public accommodations, and commercial facilities • Includes real estate brokerage offices even if located in a private residence – Modifications may be required if readily achievable • Florida Americans With Disabilities Implementation Act Interstate Land Sales Full Disclosure Act (ILSA) • Federal law that regulates sale or lease of land • Administered by Consumer Financial Protection Bureau (CFPB) • Certain developers must register developments and disclose to prospects facts regarding the real estate Two Components • Registration requirement – Developers must register subdivisions of 100 or more lots with Bureau of Consumer Financial Protection • Property report – Developers of 25 or more lots must provide purchaser with a property report disclosure before signing contract – May cancel within 7 days – Buyers who did not receive report prior to signing contract may cancel within 2 years Residential Landlord and Tenant Act • Place landlords and tenants on equitable legal basis • Applies to rental of dwelling units – Not transient facilities – Not renting of mobile home lots – Not commercial leases Deposits and Advance Rents • Landlord must account for deposits and advance rents – Hold money in a separate noninterest-bearing Florida bank account for the benefit of tenant – Hold money in a separate interest-bearing Florida bank account and pay the tenant at least 75% interest or 5% per year simple interest – Post a bond for amount of security deposits and advance rents or $50,000 (whichever is less) and pay tenant 5% per year simple interest Deposits and Advance Rents • Landlord must provide written notice to tenant within 30 days of collecting deposit Broker Property Management • If a broker holds the funds on behalf of the landlord, broker must abide by license law regarding escrow funds • Deposits and advance rents are trust funds that must be deposited into the broker’s escrow • Best to open a separate escrow for property management but not required • $5,000 broker’s funds to maintain the account • Sales associates must deliver rent and rental deposits to broker by end of next business day Obligations to Maintain Premises • Landlord – Meets health and building codes – Working heat and running hot water – Insect extermination, garbage receptacles and pickup – Working smoke detectors • Tenant – Meets health and building codes – Use reasonable care in operation of equipment – Not disturb peace of others Landlord’s Access to Premises • Tenant must allow landlord to enter property to make inspections, provide services, make repairs, and to show property • Landlord may enter property at any time in case of emergency • Otherwise, obligated to give tenant reasonable notice (at least 12 hours) Vacating Premises • When landlord is holding a security deposit – Return to tenant within 15 days if no claim is to be made – Send written notice by certified mail within 30 days if claim is made – Tenant allowed 15 days to respond to landlord’s written claim – Disputes handled in civil court • Exception to conflicting demand rules if broker is holding security deposit Termination of Rental Agreement by Tenant • 7-day written notice • Rent may be reduced by a court if tenant desires to remain on premises • Notice delivered – Personally – Mailed Termination of Rental Agreement by Landlord • 7-day written notice • 3-business-day written notice for nonpayment of rent • Notice delivered – Personally – Mailed – Posted on door Eviction Requirements • Notify tenant in writing (3-business-day or 7-day) • After time period is up, file complaint for eviction • Tenant has 5 business days to respond to complaint • If tenant continues to occupy without responding, obtain final judgment from court • Post 24-hour notice • Sheriff signs writ of possession