Section 2 Section 3 SUMMARY OF INTERSTATE LAND SALES REFORM ACT OF 1978 Subdivisions of less than 40 lots and subdivisions containing lots over 40 acre each are exempt. · Deletes existing exemption for sales pursuant to bankruptcy proceedings. Adds omissions to state material facts as violations and eliminates requireme of proof of reliance in order to establish material misrepresentation as a viol - Provides an absolute 30-day right of recission for lot purchasers. - Provides that purchaser has right to void contract at any time during 3 years after signing contract if: (a) contract signed on first day contract is offered, (b) contract does not contain a legally sufficient and (c) the developer provides financing except when title Section 4 - Copies of advertising and sales pitches must be filed as part of Statement of Re Section 5 Nothing in Act shall affect requirement that person comply with State laws rega sale of interstate land except to extent State laws are inconsistent with this Act. Section 6 Expands damages consumer may recover in civil suit under Act to include attor fees, travel expenses and appraisal costs. Purchasers may sue for specific performance of promises made by developers and on tender of the contract or de pursuant to suit to enforce rights may be entitled to a total refund of monies paid pursuant to the contract. Section 7 - Extends statute of limitations to a maximum of 7 years after sale or lease. Lengthens statute of limitations to 3 years after discovery for suit on basis of untrue statement or omission and for suit on basis of failure to file a statement of record or to give purchaser a property report. Gives OILSR authority to issue cease to desist orders against developers and to impose civil penalties on developers after an administrative hearing. Directs Secretary of HUD to appoint an Administrator of Interstate Land Sales. 51 Section 10- Raises the criminal penalties for violators of the Act from a maximum of $5,000 and 5 years imprisonment to maximum of $10,000 and 7 years imprisonment. Section 11 - Clarifies HUD authority to regulate advertising by developers. Section 12- Authorizes HUD to expend funds for public education concerning problems of buying property covered by this Act. "Parens Patriae" section allows attorney general of a State to bring civil actions on behalf of citizens of his State who have purchased land against developers who have violated this Act. Requires that developers who promise to provide basic services, such as water, sewage disposal and electricity establish escrow accounts to assure completion of these services. Lot purchasers may revoke contracts of sale if developers fail to install basic services by date specified. Summary of Administration's Proposed Amendments to H. R. 11265 Sec. 421(a): Raises from 50 to 100 lots the size of a subdivision within the jurisdiction of the Act. Sec. 421(b) and (c): The sale or lease of subdivisions of less than 100 lots, or where all lots are more than 40 acres, are exempt from the Act. Sec. 421(d): The sale or lease of land under or pursuant to a court order, where the Secretary of HUD determines it to be in the public interest, is exempt. Sec. 421(e): Eliminates exemption from the Act for the sale or lease of unencumbered land after the on-site inspection by the purchaser. Sec. 421(f): Adds prohibition against omissions to state material facts and eliminates requirement of proof of purchasers reliance in order to establish material misrepresentation as a violation. Sec. 421(f): Creates unqualified right of revocation until the 14th day after Sec. 421(g): Deletes the $1000 ceiling on the fee for filing, and adds requirement that such a fee be paid for filing a request for exemption. Sec. 421(h) (1): Unless the Secretary has accepted state approved materials, the property report shall be used in lieu of any state disclosure document. Sec. 421(i): In a civil suit by the purchaser, court may order damages, specific performance, or such other relief as the court deems fair, just, and equitable; the court must take into account: the lots contract price, the price actually paid by the purchaser, the cost of any improvements, the fair market value at the time of sale, fair market value at time suit was initiated; a purchaser may sue to revoke the contract where no property report was given at the time of signing, and the purchaser, upon divestment of his or her interest in the lot, shall be entitled to all monies paid pursuant to the contract; the purchaser may sue if developer does |