Underwriting Summary

Florida

Vesting

The following tenancy types are recognized:

• Individual

• Tenancy by the entireties (Florida has constitutional and statutory prohibitions on recognition of same-sex marriage, so same-sex couples don’t qualify for treatment as entireties property.)

• Joint tenancy with right of survivorship

• Tenancy in common (default)

• Life estate

• Enhanced life estate (Lady Bird).

A deed into trust which recites: that the trustee has full “power and authority to protect, to conserve, to sell, to lease, to encumber, or otherwise to manage and dispose of the real property” (or similar language) frees next examiner from need to review the trust or confirm compliance with internal trust requirements (unless trust or details recorded or provided), or the use of funds. In 2013, this was expanded to apply to all trusts, not just land trusts.

Acceptable instruments for transferring ownership on real property: Warranty Deed (either General or Special) however other forms of deeds exist such as, Quit Claim Deeds, Fee Simple Deeds, Trustees’ Deeds, Personal Representative Deeds.

Property Tax

• Property taxes may be paid beginning November 1 of the year for which assessed through March 30 of the year after. Checks should be made payable to the County Tax Collector.

• Property taxes become delinquent on April 1st of the year following the tax year.

• Property taxes become a lien on January 1st of the year of taxes, but the amounts owed for that year are not known until the assessed values are certified and the tax rate/millage is finalized (usually about August). They are then payable beginning in November.

• Some counties, municipalities, and local and special assessments are billed separately, most are billed on a unified bill through the county tax collector. Community development districts may or may not be billed through the tax collector.

• Property owners may elect to pay taxes quarterly. Examiner should review tax collector information closely and be sure “paid” is for entire year and not quarterly installment.

Mortgage/Transfer Tax

• Documentary Stamp Tax - Deeds $0.70 per $100.00 (Dade County $0.60 per $100.00)

• Miami-Dade County charges an additional Documentary Stamp Surtax of $0.45 per $100.00 on other than single family residence

• Documentary Stamp Tax - Mortgages $0.35 per $100.00

• Intangibles - $0.20 per $100.00 on the amount financed charged on mortgages

Spousal Joinder Requirements/Homestead

Homestead rights pertain to primary place of residence only and not for second homes, investment or commercial properties in Florida.

On conveyance or mortgage of homestead (or property acquired to become homestead) the non-titled spouse (if any) must sign and have their signatures acknowledged and notarized on the deed conveying homestead and “join” in the mortgage or other security instrument of homestead property. Even if signed at different times and places, the joinder must be in a single instrument – not two deeds or mortgages, one from each spouse. Joinder in a mortgage is best accomplished through a separate limited “joinder” statement at the end of the mortgage as simply signing the mortgage can make the non-title spouse an obligor on the note.

This is a requirement before any potential homestead interest may be validly conveyed or mortgaged. (see Art X 4 Fla. Const.). Failure of joinder on homestead makes the deed void and the mortgage voidable.

To show record compliance with the joinder requirement, all deeds (not just homestead deeds) should recite the marital status of grantors (best practice is both grantors and grantees) and the homestead or non-homestead status of the property. Suggested Language:

“Grantor represents and warrants that the Real Property is neither the homestead or residence of myself or a member of my family or any person to whom I’m obligated to provide support, nor is the Real Property adjacent to the homestead or residence of myself or a member of my family"

A deed of residential property without marital status or non-homestead, by a married person without spousal joinder or non-homestead representation, is considered a title defect. It may be cleared of record by other affidavits.

Release

• Acceptable instruments to release mortgages: satisfaction of mortgage or a partial release of mortgage.

Power of Attorney

Florida power of attorney requires 2 witnesses and notary acknowledgement. §709.2105 Power of Attorney executed out of state, not meeting the requirements above, may be relied on for conveying non-homestead property if the POA and its execution complied with laws of state where executed. WFG requires an attorney’s opinion from the state of execution concerning the due execution and validity of the power of attorney §709.2106(3) or approval from WFG Underwriting. Durable powers of attorney continue after incompetency. However, all POAs cease to be exercisable if petition to determine incompetency is filed as to the principal, until declared competent or court approves use of POA. §709.2109(3)

POA may designate multiple attorneys in fact. Unless POA says otherwise, either may act alone. §709.2111. Agent may only exercise authority specifically granted in the power of attorney and any authority reasonably necessary to give effect to that express grant of specific authority. General provisions in a POA which do not identify the specific authority granted, such as “to do all acts that the principal can do” are not express grants of specific authority and do not grant any authority to the agent. §709.2201

POA may be used for mortgage or conveyance of homestead property, if joined by spouse. Spousal joinder may be accomplished by POA. §709.2201. Out of state

POA without two witnesses may not be used to convey homestead property. See §689.111.

Instrument Requirements

• All original signatures must have names typed or printed under signature line, including witnesses §695.26

• The address of each party is required to be shown in the document. §695.26(a) & (f)

• The name and post-office address of the natural person who prepared the instrument or under whose supervision it was prepared appear on the instrument. §695.26(b) By custom this is in the upper left corner of the first page.

• While is not required for a valid deed, customary practice is to cite consideration (not the full amount paid) such as, $10.00 and OVC or Love and Affection

• The preparer does not have to be an attorney unless the requirement for such document comes from the title company whom issued the commitment

• On a deed, lease for over 1 year or other conveyance, two witnesses are required who are not parties to the conveyance instrument. §689.01 Of the two (2) witnesses one may be the notary but MUST also sign on the witness line as well as the notary acknowledgement. Two witnesses are not required for a deed by a corporation, executed under the corporate seal its president or any vice president or chief executive officer. §692.01 No corporate resolution is required. The foregoing does not apply to deeds by an LLC.

• No witnesses are required on a mortgage (although it is the better practice), lien or release of lien – except that condo and HOA lien releases require 2 witnesses.

• 3" x 3" blank space is required at the upper right of the first page and a 1” by 3”-space at the top right-hand corner on each subsequent page are reserved for recording data. §695.26(e)

• Certificate of acknowledgment before a notary public who is not a party to the conveyance, Notary's stamp is required to be imprinted on the document.

WHO MAY SERVE AS TRUSTEE ON DEED OF TRUST?

• N/A – Florida is a Mortgage State operating under a lien theory

Odd Stuff

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1. Mineral Rights. In Florida, a mineral or subsurface reservation creates a separate chain of title, so the subsurface interest is not cut-off by Florida’s marketable record title act. All mineral reservations (unless specifically stated) include a right of entry onto the surface estate to explore and remove. This interest may in some cases be eliminated by the Marketable Record Title Act. See §704.05, however MRTA does not eliminate interests in the nature of easements if used in whole or in part. §712.03(5). A great many mineral reservations were filed in the late 1800s and early 1900s.

2. Depression Era Tax Deeds (Murphy Act) During the Great Depression, the State of Florida took back a great many parcels for non-payment of taxes (by some estimates approximately 1/3 of the land mass of the state). When it reconveyed these, the conveyances reserved ½ of the petroleum and ¾ of the other minerals; and a 200 foot right of way, 100 ft each side of any State Road existing on the date of the deed.

3. Secret Mineral Rights Under § 270.11, F.S., all conveyances from the Trustees of the Internal Improvement Trust Fund or State Board of Education (the Governor & Cabinet in different capacities) and after 1986, from any local government , Water management district or other agency are required to reserve an undivided 3/4 interest in all of the phosphate, minerals and metals and an undivided ½ interest in all the petroleum. These reservations are automatic and do not require an express reservation on the face of the deed. See Caldwell v. Kemper, 31 So.2d 555 (1947). After June 15, 2001, the selling agency has discretion to not make a reservation, which shows as a statement to the contrary in the conveyance.

4. Release of Rights of Entry. The right of entry for mineral and petroleum held by the Trustees of the Internal Improvement Trust Fund or Board of Education (but not other agencies or subdivisions) was released “as to any parcel or property that is, or ever has been, acontiguous tract of less than 20 acres in the aggregate under the same ownership.” §270.11

5. Surveys are Required. Pursuant to a series of letters from the Office of Insurance Regulation, In order to remove the survey exception and/or issue form 9 coverages, a survey is required. We are permitted to rely on older surveys and an affidavit of no –changes.

6. Non-Tidal Sovereignty Lands -- those which were beneath navigable waters on March 3, 1845 -- continue to be owned by the State of Florida, Trustees of the Internal Improvement Trust Fund, even drained, filled and/or conveyed by the state without reference to the water body.

Updated 8/26/14 by Alan B. Fields