Congress Votes: Condo Buyers No Longer Covered Under ILSA Law

Sept. 23, 2014 — ILSA, the federal Interstate Land Sales Full Disclosure Act, was designed to prevent deceptive real estate practices by requiring developers to disclose information needed by potential buyers. But now a bill passed by both houses of Congress and awaiting the president's signature takes that protection away from condominium purchasers. Introduced by Sen. Charles Schumer (D-NY), Sen. Kirsten Gillibrand (D-NY) and Sen. Dean Heller (R-NV), the bill, S. 2101, came after much lobbying by the Real Estate Board of New York, reports TheRealDeal.com. Developers had complained buyers were rescinding deals and demanding money back over minor paperwork errors. Buyers have long complained that developers would sell apartments in under-construction buildings and then not deliver the goods — stringing them along for month after month. Supporters of the bill say having ILSA apply to condominiums created uncertainty for developers and that New York State has other anti-fraud protections.