I'm an investor in Florida from out of state (New Zealand). I'm doing some research on assignment deals (in the context of wholesaling), and i'm wondering what the situation is in Florida if an assignee (i.e. the end cash investor buyer) delays the final closing date for an extended period. The assignment contract I'm looking to use contains a time limit (i.e. 7 days to close from the date of signing the assignment contract), and therefore I would have the option to cancel the contract with the buyer and retain the deposit paid by them if they delay for an extended period beyond the closing date specified in the contract.
In Australasia, a Seller has the ability to charge penalty interest (usually 12-14% of the purchase price per annum calculated on a daily basis) on the purchase price if the Buyer delays closing for any reason - however this is usually only a right as between the Seller (Party A i.e. legal owner of the property) and the end-buyer (party C) because of privity of contract rules - third parties (i.e. assignees) would usually have to go through the original buyer (party B) to make a claim for damages.
Does anyone know if it is legal in Florida to charge penalty interest for delayed closing under an assignment contract and if so, can I claim interest on the whole purchase price, or is it more likely that I would just be able to charge interest on the assignment fee?
Otherwise, are there any alternatives which might protect me against the situation where a buyer may delay closing for a more than reasonable time after the contract date?
Any information anyone has would be greatly appreciated!
hey Michelle. @Steve G. would be able to help you with this question. Also, you should join our NZ investor thread here!: https://www.biggerpockets.com/forums/86/topics/308601-calling-all-new-zealand-based-investors
Hi @Kevin Estey - Thanks for your response - I've joined the NZ investor thread!
@Michelle Green you might want to read chapter 475 Fl Statutes. Do you plan on closing or walking away if you cannot assign the contract?