Do You Know Why Florida is a Great Place to Purchase Real Estate?
Today we have Sam Saad III joining us. Sam happens to be a real estate attorney here in the city of Naples and a member of the Naples city council. The reason we brought him along today is because as a real estate attorney, he deals with a lot of closings. As the president of Paradise Coast Title and Escrow, this also happens to be his specialty!
Today we wanted to talk to you about the importance of applying for Homestead. In Florida, homestead is something you can apply for when you own a property. However, as an attorney, Mr. Saad III has to remind you that this is not legal advice and if you have specific legal questions that need to be addressed by an attorney, you must do so accordingly.
Homestead in Florida is very complicated. Under the Florida constitution, Homestead is provided four protections with them being:
Out of the four protections, this is the most talked about.
In essence, as Sam Saad III explains, if you are approved for Homestead, you receive a $50,000 tax credit against the valuation on your property taxes for your ad valorem and a $25,000 credit on your school taxes.
What this means is that when the assessor comes to your home, they assess your property at a certain valuation that may not be the same as the sale price. The deduction is coming off what the value the assessor has set. Sam Saad III also added that once that assessor puts that valuation in place, the Save Our Homes Exemption provides a cap so the assessor cannot raise your taxable value (bear in mind this is different from your assessed value) by more than 3% per year. As you are most likely familiar with Florida real estate, we are prone to boom and bust periods. Sam states that this was put in place so you don’t feel giant increases in your property taxes. These are two great protections for people purchasing homes in Florida!
If a property is your Homestead, whether you are married or not, liens cannot attach to that property if a judgment is rendered against you and the person cannot take away your Homestead. Mr. Saad III noted that there are two important exceptions to that rule.
Three Exceptions
1. The first exception being that mortgage lenders can foreclose on your property if you don’t say your mortgage.
2. The second exception is that if you live in a mandatory homeowners association, the homeowners association can place a lien on your property.
3. Also bear in mind that credit card judgments and personal lawsuits, for example, do not attach to your Homestead. However if you do not pay your taxes, Federal laws generally override the state constitution. Mr. Saad III reminds us again that if there are Federal tax liens on your property, please consult your attorney to determine what your rights are. There are many exemptions and this must be dealt with properly.
For people who are looking to file for Homestead in Florida, Mr. Saad III tells us that you have to close on your property by December 31st and file for exemption by March 15th. If you did purchase your property last year, it’s important to file for your property tax reductions right away! The moment you move in your property and declare it your homestead, you receive the Debtor Protection. The other two protections do not relate to sales.
The one issue that does come up in closing is the fourth protection, the Restraint on Alienation. A husband and wife that own the property as joint tenants cannot sell the property out from the other. Essentially, it takes one to buy and two to sell.
This may seem a bit overwhelming, but Florida is a great state for Homestead! Sam states that we highly value it, the courts respect it, there are great tax exemptions and that it is a fantastic way to own your property. To learn more about Homestead, visit http://www.collierappraiser.com. If you would like to contact Sam Saad III, his information is Law Offices of Sam J. Saad III PA. 851 5th Avenue North Suite 306 Naples, Florida 34102. His phone number is 239-963-1635 if you would like to reach his office. If you have information to fax, his line is 239-791-1208.
Thanks and have a great day!
