What is Deed and How they Affect Real Estate Property Transfer in Florida
What is Deed and How they Affect Real Estate Property Transfer in Florida
The ownership of real estate properties in the United States is recorded and held at the County Recorder’s office. When ownership changes hands, it must be reflected in the public records. Hence, a deed is needed, which acts as proof of conveyance. Read on to find out what is deed and how they affect real estate property transfer in Florida.
What is a Deed?
A deed is necessary to transfer ownership or title of a real estate property in Florida. The legal document affirms, passes, and confirms real estate property transfer title and ownership.
Thus, when you transfer the tile or ownership of a property in Florida, the seller must sign a deed transferring the property from the existing owner, known as the grantor, to the new owner, otherwise known as a grantee, at closing.
Two witnesses and a notary public must be present to execute a deed in Florida. Using a deed to transfer real estate properties allows one to bypass probate. However, there are some notable downsides to using a deed. Read on to learn the types of deeds and how they affect real property transfer in Florida.
Types of Deeds in Florida
Generally, there are five main types of deeds in Florida, and each of them has different effects that come with each. They are;
- Warranty Deed
- Special Warranty Deed
- Quitclaim Deed
- Life Estate Deed
- Enhanced Life estate Deed
How Deed Affect Real Estate Property Transfer in Florida
The effect of using a deed to transfer property in Florida can be categorized into 2;
Advantages of Using a Deed For Real Estate Property Transfer In Florida
- Simplification of your property transfer: A Deed transfers ownership of your property in Florida and automatically bypasses probate. Hence, a transfer by Deed saves you the delays and expenses of Florida probate.
- Bypassing both creditors and beneficiaries’ creditors: If you transfer real estate Property through probate, it is subject to the claims of your creditors and the creditors of your beneficiaries unless the property transferred qualifies as your homestead. Hence, transferring by Deed bypasses all of these.
Disadvantages of Using a Deed For Real Estate Property Transfer In Florida
- It comes with adverse tax consequences: There may be gift taxes or penalties associated with failing to report the gift if the value exceeds the yearly gift tax limits.
- It might cause you to pay gift tax: When payment for the transfer isn’t received, the IRS considers the transaction as a gift. This requires you to pay a gift tax; however, this tax has some exclusions.
Are You trying to avoid probate in Florida and want a transfer of property ownership using a Deed? Contact your real estate Lawyer to make enquires and learn more.
