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ILSA Requirement Abolished for Condo Developers

Saul Brenner, CPA, J.D., LL.M. 11.20.2014 | eVisor

President Obama gave condominium developers a boost by signing an amendment exempting them from the demands of the Interstate Land Sales Full Disclosure Act of 1968 (ILSA). Developers of new condos or time-shares with at least 99 units will no longer have to register their buildings with the U.S. Department of Housing and Urban Development.

Compliance with ILSA had been both time-consuming and costly for condo developers — requiring detailed disclosures to buyers and unpopular contract provisions.

ILSA  was rarely used until the real estate crisis of the Great Recession when it was employed by condo buyers to terminate purchase contracts and receive a refund of their deposits.  While ILSA was designed as an anti-fraud measure, consumers are still protected by numerous other offering plan requirements.

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