What Every Floridian Should Know About Housing and Transactional Laws

Finding a place to live, buying a car, taking on student loans… all these things are major life milestones and may involve contracts and buying on credit. Find out what happens if you break a contract, why it’s important to establish credit, and what laws govern landlords and tenants.

Contracts

What is a contract?

A contract is an enforceable oral or written agreement between two or more people. The formation of a contract is accomplished when there is an offer and acceptance between the contracting parties and the exchange of “consideration” (that is, something of value).

What happens if you signed a contract before you turned 18?

With a few exceptions, contracts entered into by minors are not enforceable and may be rescinded. However, contracts of necessity, like food or shelter, are typically binding despite having been entered into by a minor. Minors may also be able to enter contracts for educational purposes or, in some circumstances, under the “Home, Farm and Business Loans Act.” Contracts made by minors for artistic or creative services or for professional sports may be approved by a court. Once a minor marries, contacts entered into by the minor are enforceable even though the minor has not yet reached the age of majority.

What are some examples of the kinds of contracts you may enter into as an adult?

Does a contract have to be in writing?

Why are written contracts useful?

If a problem arises, a written contract would offer proof of the agreed-upon terms and conditions between the people making the contract (parties). This may be beneficial in a court of law. With some exceptions, a court may not accept evidence about oral terms of the contract if there is a written contract that is complete on its face. Of note, parties are presumed to know the terms and conditions of the contract and what their responsibilities are when they sign the contract. Never sign a contract or other legal document without understanding what it means.

What should you do if you are asked to sign a contract?

Read the contract carefully and make sure you understand all of it, cross out any parts that are not what you agreed to and write in the parts of the agreement you want that do not appear in the written contract. Initial the changes and have the other party do the same to indicate his/her agreement to the terms. Do not sign a contract with any blank space on it. Make sure the other party signs the contract and get a copy of the fully executed contract for your records.

What happens if you do not complete the contract or miss payments?

If you fail to complete the contract or miss payments, without a legal basis to do so, you can be sued. You will be given a chance to defend yourself and the court will then determine if the claim brought against you is valid under the circumstances. If it is valid, you may have to pay money, do certain acts or refrain from doing other acts for breaching the contract depending on what is provided for in the contract and/or by applicable law.

Credit

Why is maintaining good credit important?

Credit is precious. The value of how much credit you have and how you use it goes far beyond shopping. Whether you have good or poor credit can likely affect where you live and even where you work, because your credit history may be considered by prospective employers. It is important to understand how credit is awarded or denied and what steps you can take if you are treated unfairly.

How do you achieve and maintain a good credit rating?

The short answer is: buy items on credit, pay for those items on time, and repeat this process for an extended period of time with numerous lenders in order to establish a credit history. A credit rating is designed to measure your ability to repay a debt. Lenders look at your history of paying bills on time, your individual account credit limit in relation to the account high balance, and your income or other sources of money in determining whether to extend credit. Having a reliable source of income and maintaining a savings account in case of emergencies makes it easier to pay bills on time, thereby ultimately contributing to a good credit rating.

What are the major laws that regulate credit?

The fundamental federal laws that regulate credit are the Fair Credit Reporting Act, Equal Credit Opportunity Act, Fair Credit Billing Act, and Fair Debt Collection Practices Act.

The Fair Credit Reporting Act values the accuracy, fairness, and privacy of information in the files of consumer reporting agencies. It also controls the use of credit reports and requires consumer reporting agencies to maintain correct and complete files. According to this Act, you have a right to review your credit report and to have incorrect information corrected. You have the right to know if you have been denied credit, insurance, or employment based on a credit report.

The Equal Credit Opportunity Act requires that individual creditors apply credit standards in a fair manner, so that all consumers are given a fair chance to obtain credit. It does not require all creditors to have the same standards, nor does it guarantee approval of loan applications. In reviewing your credit application, lenders cannot discriminate on the basis of sex, color, marital status, race, religion, national origin, age, income from assistance programs, or if you exercise your rights under the Consumer Protection Act. The only acceptable criteria are your ability and intent to repay funds borrowed.

The Fair Credit Billing Act provides for the prompt correction of errors on open-end credit accounts (department store credit accounts, for example) and protects consumers' credit ratings while they are settling disputes. Under this law, if a consumer disputes a charge, creditors cannot report the consumer's account as delinquent. This applies to open-end credit instruments, such as credit cards, revolving charge accounts, and overdraft checking services. Consumers who question an item are responsible for notifying the creditor in writing within 60 days of receiving the bill. The creditor must acknowledge the notice within 30 days and may not do anything to harm the consumer's credit rating while the item is in dispute.

The Fair Debt Collection Practices Act promotes the fair treatment of consumers by prohibiting debt collectors from using unfair, deceptive, or abusive practices. The Act does not allow calls to a debtor before 8:00 a.m. and after 9:00 p.m. A debt collector is not allowed to communicate with anyone other than the debtor or the debtor’s attorney, without express permission. Creditors may not give false, misleading, or threatening statements. The Act subjects debt collectors to actual damages, attorney’s fees, and costs. Similarly, section 559.72, Florida Statutes, prohibits anyone collecting a consumer debt from pretending to be a law enforcement officer or a representative of any governmental agency, threatening force or violence, threatening to disclose information regarding the debt to another, or misrepresenting that the collection effort is from an attorney.

How long does it take to clear a bad credit report?

It depends on the seriousness of the past problems and the accuracy of the consumer report. If you believe there is inaccurate information on your credit report, you must follow the proper procedures to dispute the errors in accordance with the Fair Credit Billing Act. If the negative information is accurate, the Fair Credit Reporting Act also prevents certain credit information from being included on consumer reports if that information is more than seven or ten years old, depending on the type of debt.

What is collateral?

Collateral is anything of value that can be taken by the lender if you do not pay back the loan. Loans that are granted based upon collateral are called “secured loans” (i.e., a home mortgage or car note). The lender wants to identify property owned by the borrower which has a value at least equal to the amount of the loan so that the property can be used to pay back the debt if you are unable to repay the loan. If the collateral’s value is not worth equal to or more than the amount of the outstanding debt, the lender may seek a deficiency judgment against you for the difference. There is another type of loan called an “unsecured loan” which does not require collateral but is based on the user’s ability to pay (i.e., credit cards and student loans).

Can a lender have different rules for making loans to women and men?

No. It is unlawful for any creditor to discriminate against any applicant on the basis of sex or marital status. Lenders may only make decisions based on the borrower’s ability and intent to repay the loan. A married person who is not employed outside the home might have problems obtaining a loan unless that person has sufficient collateral to provide security for the loan. If the person’s spouse has a good credit rating, the spouse could guarantee the loan as a co-signor or provide other security to support the loan.

For further information on credit, visit the Federal Financial Literacy and Education Commission’s website. To find out more information about your credit rating and obtain a free credit report, visit annualcreditreport.com to receive your credit report from the three major agencies: Experian, Transunion, and Equifax. This website allows you to receive one free credit report from each of these three agencies every twelve months. However, these reports do not include your credit score. Some additional detailed information may also be missing from your free credit report. If you would like more information, you may purchase additional accessibility from each agency or from various credit assistance organizations.

Are student loans different in how they are legally treated?

Yes, in some noteworthy ways. Generally, student loans CANNOT be discharged in bankruptcy, unlike most other forms of credit, with some exceptions in disability. Therefore, you should be particularly careful when taking out student loans, whether they are from the federal government or from private banks. If your student loans are federally provided, various payment and discharge options are available. For example, IBR (Income-Based Repayment) reduces monthly payments to 15% of your annual discretionary income divided into twelve monthly payments. Also, if successfully paid for a certain number of years, the remaining balance will be forgiven (though you may owe federal income tax on the forgiven amount.) For more information, see the Federal Student Aid website.

What is identity theft and how does it affect your credit?

Identity theft occurs when someone steals your sensitive personal information, such as your name and social security number and uses this information to commit fraud. This may include opening a credit card account or filing tax returns in your name. Identity theft can inflict long lasting damage to your credit status because the thief is not going to pay back any loans the thief took out in your name.

How can you protect yourself from identity theft?

First, protect your sensitive personal information as much as possible. Also, regularly obtain your credit report and check it for any accounts you did not open. As mentioned above, you may obtain your free credit report every twelve months at annualcreditreport.com. You may also purchase credit monitoring services or “freeze” your credit through various services, but make sure you exercise your own due diligence even if you purchase such a service.

Landlord & Tenant

Is a written lease for a residence necessary?

A written lease is not required, but it is a good idea because a lease defines what the landlord (owner) and the tenant (renter) must do. In the absence of a written lease, some lease terms may not be enforceable.

What happens if you break a lease?

How much notice must a landlord give the tenant to move out of the residence?

The right to remain in possession, based on a written lease, will continue until the end of the term of the lease, unless the lease is terminated for cause. For oral leases, the amount of notice depends on the rent payable period. If the rent is paid every week, the landlord must give seven days’ notice prior to the end of the weekly period. If the rent is paid every month, the landlord must give 15 days’ notice before the end of the month. If the tenant continues to occupy the premises after the expiration of the lease (without permission) or if the landlord has terminated the rental agreement for any of the reasons allowed under the Landlord and Tenant Act and the tenant does not move, the landlord can start eviction procedures and/or increased rental payments. In the case of non-payment of rent, the landlord must serve the tenant with a written notice allowing 3 days (excluding weekends and legal holidays) in which to pay the rent or move. In order to gain possession of the dwelling, the landlord must file suit in court, providing the court with a copy of the three-day notice. The tenant then has 5 days, excluding weekends and legal holidays, to respond in writing to the court and to post the amount of rent claimed to be due into the court registry or ask the Court to determine how much money is owed if the tenant is claiming that the rent was already paid. If the tenant does not respond to the complaint or a judgment is entered against the tenant, the clerk of the county court will issue a writ of possession to the sheriff and the tenant will have only 24 hours’ notice prior to eviction from the time the writ is posted on the tenant’s door.

Florida law does not allow the landlord to use self-help eviction. The landlord is not allowed to:

Shut off the utilities (water, gas, electricity, etc.) even if the service is in the landlord’s name.
Change the locks or use any boot lock or similar device, except for repair, maintenance or replacement.
Remove the outside doors, locks, roof, walls or windows.
Remove the tenant’s personal property from the dwelling unit unless proper legal action has been taken.

If this occurs, the tenant may sue for actual and consequential damages or three months’ rent, whichever is greater, plus court costs and attorneys’ fees.

Should a tenant get interest on a security deposit or advance rent?

How can the tenant tell if the landlord is using an interest or non-interest bearing account?

Can the tenant get his or her security deposit back?

Once a tenant vacates the premises at the end of the rental agreement or abandons the property with proper notice to the landlord, the landlord has 15 days to refund the security deposit or 30 days to send a certified letter to the tenant imposing a claim on the deposit and stating the amount and the reason for the claim. If this notice is not sent as required, the landlord forfeits the right to impose a claim. Should the tenant, however, fail to give the landlord at least 7 days written notice prior to vacating, the landlord is not required to send the written notice of claim. Unless the tenant objects in writing to the landlord within 15 days of receipt of the claim letter, the landlord must return the deposit less the landlord’s claim within 30 days of the date of the landlord’s claim notice. After the tenant objects the matter may be taken to court in the event the parties cannot reach an agreement.

Does the landlord have a right to enter the tenant’s residence?

The landlord or those hired to perform work for the landlord may enter the residence from time to time to inspect the premises; make necessary or agreed repairs, decorations, alterations, or improvements; supply agreed services; or exhibit the dwelling unit to prospective or actual purchasers, mortgagees, tenants, workers, or contractors, after providing reasonable notice. The landlord may also enter the residence without the consent of the tenant, in case of emergency, when the tenant unreasonably withholds consent, or when the tenant is absent from the dwelling for a time equal to one-half of the rental period (unless, the tenant has notified the landlord of the absence and paid the rent).

What must the landlord do to maintain the premises?

The landlord must follow all applicable building, housing and health codes and statutes. This usually means keeping roofs, windows, screens, doors, floors, steps, porches, exterior walls, foundations, and structural components in good repair and the plumbing in reasonable working condition. Unless otherwise agreed in writing, for any rentals other than a single family house or duplex, the landlord also must provide for locks and keys, the clean and safe condition of common areas, removal of garbage and provide garbage receptacles, extermination of rodents, roaches, ants and termites, functioning facilities for heat during winter, hot water and running water. The tenant may be charged for utilities, water, fuel and garbage removal. If the tenant provides written notice informing the landlord that the tenant will withhold rent if the defects are not repaired within seven days, and the defects are not repaired after the time period expires, the tenant may then lawfully withhold the rent that comes due until such time as the repairs are made. If an eviction is file, lawful withholding is a complete defense and the judge can determine the “diminution of value” of the property in the unrepaired condition to determine how much rent is actually owed.

What must the tenant do to maintain the premises?

The tenant must also follow applicable building, housing and health codes and statutes. The tenant has an obligation to keep the premises clean and sanitary; remove garbage; keep plumbing fixtures clean, sanitary and in repair; use equipment and appliances in a reasonable manner; not destroy, deface or remove property of the landlord or allow those visiting to do so; and to conduct him or herself, family and others in a manner which does not disturb neighbors or breach the peace.

Do you have to pay rent if the property is under foreclosure?

A tenant is liable according to the terms of the lease. The filing of a foreclosure suit does not typically terminate a lease, and a failure to pay rent may result in breach of contract (see WHAT HAPPENS IF YOU BREAK A LEASE? above). In some cases, the tenant may be required to pay rental payments to the foreclosing party. A tenant may also have certain rights in a foreclosure suit to protect himself/herself. You may need to contact your legal representative regarding your particular rights during a foreclosure suit.

For more information concerning landlord and tenant law, you can visit the Florida Department of Agriculture and Consumer Services’ web page on landlord/tenant law in Florida.

Consumer Protection for Cars

Does the law protect you if you bought a “Lemon”?

Yes. The Florida’s Motor Vehicle Warrant Enforcement Act is commonly referred to as the “Lemon Law” may provide assistance. If a “motor vehicle” that is purchased or leased in Florida has a defect or condition that substantially impairs the use, value or safety of the vehicle, you must report the problem to the manufacturer or authorized service agent (typically the car dealership) during the "Lemon Law Rights Period" (the first 24 months after the original delivery of the motor vehicle to a consumer) in order to exercise rights under the Lemon Law. However, any defects or conditions that result from an accident, abuse, neglect, modification, or alteration of the vehicle by persons other than the manufacturer or its authorized service agent are not included.

The Lemon Law defines “motor vehicle” to include any new and demonstration motor vehicles; trucks weighing 10,000 pounds or less gross vehicle weight; recreational vehicles, and leased vehicles if the lessee is responsible for repairs. In addition, if a car is transferred directly to another consumer from the original purchaser within the first 24 months after its original purchase, the transferee can also seek redress under the Lemon Law, with the original time frames still in effect.

Must the manufacturer or dealer repair the defect or condition covered by the warranty?

The Lemon Law requires a manufacturer to correct a vehicle’s "nonconformity" (as defined by the statute) “within a reasonable number of attempts." Two options are listed under the law to help determine what constitutes a reasonable number of attempts. First, if the manufacturer or authorized service agent has been unable to fix the same defect after three attempts, the consumer may send written notification of the need for repair to the manufacturer by registered or express mail to give the manufacturer one final opportunity to cure the defect. The manufacturer must respond within 10 days of its receipt of the notice and direct the consumer to a reasonably accessible repair facility within a reasonable time after the consumer’s receipt of the response. After the vehicle has been delivered to the designated repair facility, the manufacturer has 10 days to fix the defect (for recreational vehicles, the manufacturer has 45 days (not 10) to correct the nonconformity). If the nonconformity has not been corrected at the final repair attempt, the vehicle is presumed to be a Lemon. In addition, if the manufacturer fails to comply with either of the above time requirements, the manufacturer effectively waives its opportunity for a final repair attempt.

Or second, if the vehicle is in and out of the authorized repair shop for repair of one or more nonconformities for 15 or more cumulative days, the consumer may give written notification of this fact to the manufacturer (not the dealer), by registered or express mail. After the manufacturer’s receipt of the notification, the manufacturer or its authorized service agent must have at least one opportunity to inspect or repair the vehicle. If the vehicle has been out of service for repair of one or more nonconformities for a cumulative total of 30 days, it is presumed to be a Lemon, whether the vehicle has been repaired (the time frame is 60 days for an RV).

Note, however, that these are presumptions; a consumer may be able to show, under a particular set of circumstances, that fewer than three repair attempts, or less than 30 days out of service, constitutes a “reasonable number of attempts,” and that the manufacturer has failed in its duty under the statute.

What if the manufacturer fails to correct the nonconformity within a reasonable number of attempts?

If the manufacturer fails to correct one or more nonconformities within a reasonable number of attempts, the manufacturer must either repurchase or replace the vehicle. The consumer has a right to choose to get refund rather than a replacement vehicle.

If a manufacturer has established an informal dispute settlement program certified by the Florida Department of Legal Affairs, the consumer must first resort to that relief under the program before making claim for replacement or a refund.

If the consumer resorts to a manufacturer’s certified informal dispute settlement program and a decision is not rendered within 40 days, or if the consumer is not satisfied with the decision, or if the manufacturer does not have a certified informal dispute settlement program, the consumer may request arbitration by the Florida New Motor Vehicle Arbitration Board, by contacting The Lemon Law Hotline at (800) 321-5366, or by calling 850-414-3500 if out-of-state, and asking for a Request for Arbitration form.

The Florida New Motor Vehicle Arbitration Board is administered by the Office of the Attorney General. If the request for arbitration is approved, the board will hear the dispute within 40 days and render a decision within 60 days of the date of approval. If the decision is in favor of the consumer, the manufacturer must comply with the decision within 40 days after receipt of the written decision. Once the arbitration board rules on the case, either side can then appeal the decision in court.

Can a repair shop charge you more than the estimate for repairs?

Can the repair shop charge for diagnosing a problem prior to doing a repair estimate?

Can you get your car back if you disagree with the repair shop on the bill?

Yes. In Florida, it is unlawful for any motor vehicle repair shop to fail to return a customer’s motor vehicle because the customer refused to pay for unauthorized repairs or because the customer has refused to pay for repair charges in excess of the final estimate. However, if the repair shop claims the work was performed under a proper written estimate, the repair shop may file a lawsuit to place a possessory lien against the vehicle. If this occurs, you can pay the amount of the repair plus storage charges less any payments as a bond to the clerk of the circuit court. The clerk will then issue a certificate which you deliver to the shop to pick up the car. The repair shop would need to sue to get their money within 60 days and may request the court order a public sale of the vehicle to satisfy the lien. If the repair shop does not sue within 60 days, the clerk of the court shall return the bond money to you. No motor vehicle repair shop may refuse to return a customer's motor vehicle by virtue of any miscellaneous lien.

Student Loans

How do you find out about student loans?

If you apply for financial aid for undergraduate college or graduate school, you may be offered loans as part of your school’s financial aid offer. A loan is money you borrow and must pay back with interest. Student loans can come from the federal government, from private sources such as a bank or financial institution, or from other organizations.

Why are the loan details important?

Before you take out a loan, it’s important to understand that a loan is a legal obligation that makes you responsible for repaying the amount you borrow with interest. If you decide to take out a loan, make sure you understand who is making the loan and the terms and conditions of the loan. Even though you don’t have to begin repaying your federal student loans right away, you shouldn’t wait to understand your responsibilities as a borrower.

How do you apply for student loans?

What should you be concerned about when taking out a student loan?

General guidelines for responsible borrowing are:

Keep track of how much you’re borrowing. Think about how the amount of your loans will affect your future finances, and how much you can afford to repay. Your student loan payments should be only a small percentage of your salary after you graduate, so it’s important not to borrow more than you need for your school-related expenses.
Research starting salaries in your field. Ask your school for starting salaries of recent graduates in your field of study to get an idea of how much you are likely to earn after you graduate.
Understand the terms of your loan and keep copies of your loan documents. When you sign your promissory note, you are agreeing to repay the loan according to the terms of the note even if you don’t complete your education, can’t get a job after you complete the program, or you didn’t like the education you received.
Make payments on time. You are required to make payments on time even if you don’t receive a bill, repayment notice, or a reminder. You must pay the full amount required by your repayment plan, as partial payments do not fulfill your obligation to repay your student loan on time.

Keep in touch with your loan servicer. Notify your loan servicer when you graduate; withdraw from school; drop below half-time status; transfer to another school; or change your name, address, or Social Security number. You also should contact your servicer if you’re having trouble making your scheduled loan payments. Your servicer has several options available to help you keep your loan in good standing.