The Honest Broker: Permits and Due Diligence

The Honest Broker: Permits and Due Diligence

                     Written by Diane Lott, Broker/ Paradise Found Realty

As a homeowner, it is necessary to make sure that you perform “due diligence” with respect to permitting being done on home repairs.

What is “due diligence”?

“In law: the care that a reasonable person exercises to avoid harm to other persons or their property”.  This concept is consequential to home ownership. Permits can be obtained by a homeowner who intends to do work on their own property or by a contractor. The primary reason for a permit is to have the city, or county inspector oversee the project and ensure that it conforms to code and approved standards.  Permits are applied for prior to work commencing and the “Notice of Commencement or NOC” is legally filed with the court.

According to Florida law, an owner of real estate must record an NOC when a contractor, subcontractor, material provider or laborer starts a work or improvement on your property under Florida’s Mechanic’s lien law.  This applies to all private jobs when the value is over $2500. If a contractor is used, that is done by the company when applying for the permit.  During the project, the inspector comes in to evaluate if it is conforming to code and either passes or fails the project. If the project passes, the contractor/homeowner then must “close” out the permit.  Here is where vigilance by the homeowner is imperative. 

I recommend that you follow the process and make sure that the permits get closed out and the NOC is released. Why?? Sometimes, contractors hire sub-contractors that may not be paid, or not pay for their supplies.  Even though the job is done and “passed” by the officials, the lien, unless removed, still makes the homeowner responsible for payment of anyone involved in the project. Which in turn, leaves you literally holding the financial “bag”. 

The project is complete, the contractor was paid, but unless the NOC is removed, you still have liability to anyone else involved.  The liens will be paid at the time of an eventual sale of your home or you could be sued personally for payment. This can be avoided if you withhold final payment to your contractor until the NOC is released.  This can be easily accomplished by going on to the city and county website or ask the contractor to show proof that the NOC has been released.  This due diligence and follow through on your own behalf will prevent any potential problems when a title search is conducted upon the sale of your home in providing a clear title to the new buyer.  

Stay well and Stay healthy

Diane

Diane Lott, Broker

Owner: Paradise Found Realty

*The highest compliment you can give is when you feel you can refer a friend…
  Hope to see them soon!

Paradise Found Realty, Inc. of Palm City

website:  www.ParadiseFoundRealtyFl.com

Email:  diane@paradisefoundrealtyfl.com

Phone:  954-294-5060

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  • Posted 3 years ago

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