Easy Guide to FAR-BAR

The FAR-BAR Contract is a standard agreement form developed and issued by a joint committee of the Florida Bar and Florida Realtors (formerly the Florida Association of Realtors). The Real Estate Attorney-approved form is officially licensed in the State of Florida and is widely used by real estate brokers, attorneys, investors, sellers, and buyers in real estate transactions. Its popularity stems from the fact it standardizes many of the key provisions in a property transaction, making it easier for people without a legal or real estate background to prepare, review, and simply fill in the blanks. Nevertheless, it pays to have an experienced Real Estate Attorney by your side to look out for any errors or discrepancies that remain all too common on these forms.

In particular, you need a keen eye when it comes to the “As Is” FAR-BAR Contract, which has become more common in recent years following a wave of foreclosures and short sales in Florida. This version of the FAR-BAR form binds the buyer to accept the property in its present condition (hence “as is”) without obligating the seller to make any additional repairs and improvements. It also gives the buyer fifteen days to do an inspection of the property. Should any issues be revealed that require repairs, the buyer can negotiate for a lower sales price or request a credit to cover the cost of said repairs. If the seller refuses, the buyer can back out of the agreement within the fifteen day period without any penalty or loss of the deposit.

Although the FAR-BAR “As Is” Contract loosens many obligations on the seller, it still requires the seller to make several disclosures about the property to potential buyers, including:

• Existing or potential legal claims that affect the property
• Boundary disputes, environmental hazards, and damage and/or infestation from termites or other pests
• Prior, existing, or potential damage from sinkholes
• Issues with HVAC, roofing, plumbing, electrical wiring, and other essential components
• Any and all compliances required by the condo or homeowners association

As it stands, Florida courts are divided regarding the seller’s obligations to disclose information that is in the public records. One appeals court ruling held that the buyer was responsible for finding out local flood regulations that affected the property, since those details are publicly available. But a ruling from another appeals court found that even the public accessibility of information does not leave the seller or their agent off the hook for misrepresenting or neglecting to mention issues with their property.

Don’t let the seeming simplicity of the FAR-BAR “As Is” Contract lower your guard: as you can see, there are still plenty of potential risks and legal problems that can emerge in real estate transactions of all kinds, no matter how straightforward the terms seem.