Guidelines For Filing Your Annual LLC Report

Each year, Florida LLCs and corporations are required to file detailed annual reports. This process is more than just paperwork; it's a declaration that your business still operates and complies with the state's regulatory framework. Ensuring this document is filed accurately and on time is crucial for maintaining the legal status of your business and avoiding potential financial penalties.

The Value of Timely Reporting

After forming an LLC in Florida, the next step is to file an annual report. This report, due annually with a fee of $138.75 (at the time of this post), must be submitted to the Florida Division of Corporations, also known as Sunbiz. Each year, the submission window opens on January 1st and closes on May 1st. This is a specific deadline, and it will close at 11:59 pm.

One common question is if they must file a report if their business was established during this window. For example, does this apply to people whose LLCs were approved in March 2024? Your first Annual Report would not be due until the following year, which would land between January 1st and May 1st, 2025. Timely filing is essential to avoid penalties and ensure your LLC remains in good standing. 

The initial report is a baseline for your business's information regarding the state’s records. It is an opportunity to update any changes your business has made, such as address changes or changes in management. This report also reminds you of your business's transparency and commitment to regulatory compliance. Filing early can prevent last-minute issues and ensure peace of mind. Keeping track of this requirement allows your LLC to be operational for another year.

Avoiding Costly Mistakes 

If you miss the May 1st deadline, you will automatically be assessed a $400 penalty. (This  increases the total fee to $538.75.) However, if you do miss the deadline, there’s a lesser-known strategy you can employ. If your LLC is dissolved for not filing by the fourth Friday in September, you can reinstate it at a lower cost. The reinstatement process involves a $100 fee and the Annual Report fee of $138.75. This effectively avoids the $400 late penalty fee. You can save money by waiting until your LLC is dissolved and then reinstating it for $238.75. Although this is one option, you should speak to your attorney. 

You can only file through Sunbiz online. Reminders from Sunbiz are helpful, but relying solely on them is risky. Your business can file your reports around the same time every year, or you can set up a personal reminder system to prevent costly oversight. Proactive planning is key, whether marking a calendar or setting a digital alert. These basic tips that anyone can use effectively distinguish you from being compliant and being subjected to penalties.

Schedule a Consultation With Spectrum Title Services 

The Annual Report is critical to maintaining your business's legal standing in Florida. You are committing to transparency and compliance with state regulations by meeting this requirement. The process, while straightforward, demands attention. Missing deadlines leads to unnecessary penalties. Planning and leveraging available resources can ensure this annual obligation is easily met. If the process seems challenging or you want assurance that everything is filed correctly, schedule a consultation with us. 

When Refinancing a Loan Makes Sense

Many people hear the term “refinancing,” but few fully understand when is the right time to do it. It’s a significant decision that impacts your financial future. Refinancing can be financially advantageous under the right circumstances.

There are several logical and valid reasons behind refinancing, and we want to help you decide whether it makes sense for you and your family. The key is understanding if and when it fits into your long-term plans. 

Understanding Refinancing 

Homeowners can alter the terms of their loans, which is often done to secure a lower interest rate (often lowering monthly payments). It mimics the closing process, and the fees are similar. Refinancing typically involves costs, such as closing fees, so these expenses must be calculated and considered. Lowering your interest rate can also impact your credit score over the long term.

Refinancing with a lower rate can result in reduced payments, ultimately leading to significant long-term savings. As a hypothetical scenario, imagine that you refinance five years into your 30-year mortgage. Refinancing a $300,000 mortgage from a 5% interest rate to a 4% interest rate—with the remaining term adjusted for the time already paid—the monthly payments would be reduced, saving approximately $178.21 each month.

Remember, the exact savings and new payment varies based on the remaining balance at the time of refinancing and any fees or additional costs associated with the refinancing process. It's common to refinance into a new 30-year term, which lowers monthly payments but extends until the mortgage is paid off.

Another common motive for refinancing is shortening the duration of your mortgage. If you initially obtain a 30-year mortgage, switching to 15 years shortens the time it takes to own your home outright. A younger couple may have begun with a 30-year mortgage but have gained assets and financial security quicker than anticipated. They may invest in refinancing to limit their interest payments if they can afford it. Although many people would love to shorten their loan, the question shifts to your new payments. Presumably, they’ll increase. Depending on your financial position, you may be willing to accept this. The staggering upside is eventually not having a mortgage payment while living in a home that is still appreciating. 

Refinancing your mortgage for a lower interest rate has its benefits. It can free up funds that you can use for expenses or savings. Before deciding to refinance, remember it's important to compare your interest rate with the rates to determine if it makes financial sense.

Let’s Look at Term 

Another reason people consider refinancing is to switch from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage. ARMs are subject to fluctuating interest rates. Refinancing to a fixed-rate mortgage gives you stability and predictability regarding your payments. Fixed rates protect you from entering into unexpected scenarios where you cannot afford your mortgage because of a spike in interest rates. 

Extending the duration of your mortgage by refinancing may be a logical choice for those who intend to remain in your home for an extended period. They can enjoy the lower payments while also not being concerned about selling their property any time soon. Others may pursue this route to take advantage of lower payments because of a change in their financial situation. 

However, it's essential to remember that a longer mortgage will result in you paying significantly more in interest over the term of your loan. Always take your term objectives into account when making this decision. 

Contact Spectrum Title Services 

At Spectrum Title Services, we encourage you to obtain a title quote from us as you contemplate refinancing. We are here to assist you in comprehending your choices and finding the path forward for your home and finances.

Why The Real Estate Industry Will Look Different In A Year

The recent verdict against the National Association of Realtors (NAR) and two major real estate companies is creating significant changes in the U.S. housing market. This landmark case concluded that the NAR and two brokerage firms conspired to keep commission artificially high, with the jury awarding an enormous sum of $1.78 billion in damages.

This ruling puts a spotlight on long-standing practices in real estate commission structures. The implications are far-reaching, signaling a potential overhaul in how real estate transactions are traditionally conducted.

Details of the Ruling

The case revolved around the NAR's commission-sharing rule. If you have ever bought or sold a home, you will recall that this is a common practice regarding the listing agent's commission. These fees are usually between 5% and 6% of the home's sale price. They get split with the buyer’s agent. 

This system was challenged in court, and the jury agreed that it unfairly increased the costs for sellers. The verdict opens the door to new models of compensation that could create more transparent and equitable financial arrangements in real estate transactions.

The court may abolish commission-sharing, transforming how real estate agents are compensated. Such a shift would disrupt long-standing norms in the industry, impacting how agents market their services and negotiate their fees. The traditional model of commission sharing may soon give way to more innovative and flexible structures, benefiting both agents and their clients.

Implications for Buyers and Sellers

The immediate beneficiaries of this lawsuit are the 500,000+ home sellers in Missouri. These are the members of the class action suit. However, the effects of the case extend far beyond Missouri. There are other ongoing lawsuits against NAR, with potentially enormous settlements that could redefine the landscape of real estate commissions nationwide. This wave of legal challenges could lead to a broader movement towards fairer and more transparent real estate practices nationwide.

For buyers, the future of agent commissions remains to be determined. If the judge decides to modify or end commission sharing, buyers might need to pay their agents directly. This change could lead to increased upfront costs in buying a home. Buyers would have to account for their agent's fees on top of down payments and closing costs. The potential shift could also encourage buyers to become more involved and informed about the financial aspects of their real estate transactions.

On the seller's side, the benefits could be more immediate. Without the obligation to share commissions, sellers negotiate better rates with their agents, potentially saving on the costs of selling their homes. Some brokers are already considering removing commission sharing from their listings, which could lead to significant savings for sellers. This newfound flexibility also empowers sellers to explore strategies that align more closely with their financial goals and needs.

The full impact of the Sitzer/Burnett decision and other ongoing cases remains to be seen. We will likely see significant changes affecting buyers and sellers in ways yet to be fully understood. As these changes unfold, the need for guidance and reliable information becomes even more critical for those navigating the real estate market.

Spectrum Title Services, LLC

Spectrum Title Services, LLC is here to help those navigating this changing landscape. Our experience in residential and commercial real estate transactions ensures our clients receive the best possible support. Contact us for a title quote, whether buying, selling, or refinancing.

Understanding Property Taxes: Making Wise Decisions Before Year-End

Property taxes are a crucial aspect of homeownership because of how significantly they can impact your financial planning and budgeting. They also fund vital public services and contribute to community development.

However, managing these taxes can be challenging, especially for those unfamiliar with the system. We wanted to provide clear and concise information on property tax assessments, payment deadlines, discounts for early payments, and homestead exemption benefits.

Optimizing Property Tax Payments

The first step in managing property taxes is understanding the assessment process. Property taxes are based on the assessed market value of your property. These are determined by factors such as location, size, and condition. Knowing this value is essential for budgeting and planning.

Property tax payment deadlines vary, and land between November and March. Many areas offer discounts for early payment. For instance, in Broward County, Florida, a 3% discount is available for payments made in December. These incentives work well for the state and the person being taxed. They encourage people to pay quickly; in return, they can reap significant savings.

Maximizing Benefits Through The Homestead Exemption

Another key aspect is the homestead exemption, which benefits people who only pay taxes on their primary residence. This exemption lowers the property's assessed value and effectively reduces how much tax it owes. The exemption amount and eligibility criteria differ by location.

To qualify, homeowners must apply with their local property appraiser's office and provide proof of residency. Once granted, the exemption can offer substantial savings. Homeowners who close on property before December 31st are eligible for the homestead exemption for the following year. But this does lead to them receiving immediate tax benefits from the start of the new year.

Financial Planning and Property Taxes

Homeowners need to develop effective financial plans based on their property taxes. By understanding the tax system, homeowners can budget accurately and avoid unexpected costs. This includes awareness of the annual tax rate, potential increases, and applicable local fees or assessments. Homeowners should also explore any available tax relief programs, especially for seniors, veterans, or those facing financial hardship. Staying informed and proactive in financial planning can prevent the stress of unforeseen tax liabilities.

Moreover, understanding property tax trends and changes in tax legislation is crucial. Local government decisions can significantly affect property tax rates, and being aware of these changes can help homeowners plan better. Community discussions about property taxes can also provide valuable insights and opportunities to advocate for fair tax practices.

Spectrum Title Services

Spectrum Title Services is a reliable ally for homeowners navigating property tax intricacies. We are dedicated to helping homeowners make informed decisions that align with their financial goals and reduce tax burdens.

For personalized assistance in managing your property taxes effectively and to make the most of your homeownership experience, consider reaching out to Spectrum Title Services. We are committed to empowering homeowners. Our extensive experience within the real estate market and tax laws makes us an invaluable resource for those seeking to understand and navigate the complexities of property taxes.

Understanding Florida Power and Light (FPL) Easements

Florida Power and Light Company (FPL) is responsible for ensuring the delivery of consistent and reliable electrical services across 35 counties. They must maintain 99.98 percent electric service reliability, and this incorporates accounting for growth and providing seamless electricity transmission to countless households and businesses. What does this have to do with homeowners? An integral part of FPL’s planning involves obtaining easements across private and public territories. These legal provisions are crucial for FPL to install, access, and maintain their equipment, ensuring that power reaches every customer efficiently and at the lowest possible cost.

Understanding Easements and Their Impact 

An easement grants FPL the legal authority to use a portion of your property for specific utilities-related purposes. This applies to installing power lines and poles, conducting maintenance and repairs, and even trimming trees to prevent obstructions. In most situations, FPL acquired these rights years ago to accommodate the future needs of expanding communities.

These rights are frequently shared with other utility providers. They allow companies like FPL to collaborate with others to serve the public efficiently. For property owners, understanding the presence of easements is paramount. You can determine whether there are easements on your periphery through the county recorder’s office, a surveyor, or a title company. It is crucial to note that while you can use the land within the easement, it is subject to limitations. As frustrating as that appears, the purpose is to ensure safety is not compromised, and FPL’s operations remain unhindered.

Proactive Steps for Property Owners 

For those who own property, utilizing resources such as title insurance policies or ALTA/ACSM land title surveys is beneficial. These documents provide a comprehensive view of any existing easements. Title insurance policies typically cover 60 years. It is essential to know that some older easements may need to be listed. When considering utilizing the land within an easement, a careful review and approval process is necessary. This ensures that the proposed use aligns with safety and operational standards. FPL also encourages property owners to participate in programs like Right Tree/Right Place, promoting safe and strategic planting to avoid interference with power lines.

Understanding the intricacies of property ownership—especially when easements are involved—requires a clear understanding and proactive approach. At Spectrum Title Services, LLC, we are dedicated to helping you with the purchase, sale, or refinance of your valuable assets. With a keen focus on transactions ranging from $400,000 to $3 million, we are uniquely positioned to serve our community efficiently. We also aim to educate and build lasting relationships with younger real estate agents, guiding them through the complexities of real estate transactions and ensuring their clients are well-informed.

Spectrum Title Services, LLC

To schedule a consultation and learn more about how we can assist you in navigating property transactions involving FPL easements, please contact Spectrum Title Services, LLC today. Our 

team is ready to provide the guidance and support you need to make informed decisions and protect your property interests.

Understanding the Implications of Florida Senate Bill SB 264

The signing of Florida Senate Bill SB 264 (FL 264) into law on May 8, 2023, by Governor Ron DeSantis marked a noteworthy shift in owning property in Florida. Specifically, it pertains to people originating from specific nations. This legislation brings forth a wave of new regulations, but it has sparked conversations amongst Florida’s real estate stakeholders. Floridians have been forced to examine property rights, international relations, and national security.

FL 264 contains provisions and penalties that aim to regulate and inspect who buys property in this state. To be clear, this does not apply to everyone but to foreign principals that have since been declared "foreign countries of concern." The aftermath of this legislation has been talking about balancing national security worries, potential discrimination, and legal challenges. Floridians expect to see impacts on real estate, agriculture, and international investment. For this reason, it is crucial to understand the law accurately and how it applies to the territories identified in FL 264.

Examining the Provisions of FL 264

FL 264 enforces restrictions surrounding owning and acquiring more than a typical real estate purchase. It applies to agricultural land and real property within 10 miles of a military installation or critical infrastructure. It prevents foreign principals from seven identified countries from buying these properties. The legislation requires buyers to provide an affidavit declaring they do not fall under the specified parties. The law extends even further than that. It introduces penalties for those who sidestep the ownership provisions. The punishments range from civil actions such as forfeiture to criminal charges. The bill also emphasizes agricultural land. Hence, the registration requirement for foreign principals who possessed such land before July 1, 2023, and wish to maintain ownership.

It contains additional restrictions concerning citizens from the People’s Republic of China. The law integrates supplementary requirements and regulations on property ownership. A notable clause allows Chinese nationals to purchase a single residential property of up to two acres under the condition that it is not located within five miles of a military installation and they hold a valid U.S. visa.

Controversy and Legal Consequences

Despite certain circles endorsing FL 264 for safeguarding national security, it has not avoided substantial critique and legal objections. The criticisms revolve around potential racial profiling and discrimination. Some have pointed to a potential clash with the Fair Housing Act, a federal law. A lawsuit filed by a coalition of legal entities on May 22, 2023, challenges the law. It raises constitutional and discriminatory objections. Thus, FL 264 finds itself connected to an examination of legal, social, and ethical dimensions. The future of this law and its subsequent impact on the real estate market is still to be determined.

In light of the ongoing legal contention, the defined specifications and restrictions within the bill carve out new regulatory issues that prospective buyers, sellers, and real estate professionals must navigate—ensuring compliance while awaiting the outcome of the lawsuit that might affect the bill’s enforcement or modification.

Spectrum Title Services

Navigating the current real estate market demands keen accuracy and comprehensive knowledge in the context of regulatory changes and legal discussions. Spectrum Title Services is prepared to assist you through your transactions, ensuring your dealings adhere to compliance and remain secure amidst the new regulatory backdrop. We invite you to schedule a consultation with Spectrum Title Services today to ensure adherence to current laws.

Trim Notices & November Tax Bills

Trim notices often leave property owners with a series of questions. They are confronted by numbers and rates, which can generate the feeling that you are looking at a hidden code. In Florida, a "TRIM Notice" or "Truth in Millage Notice" is sent annually to property owners detailing their property's assessed value, proposed tax rates, potential taxes owed, and public hearing dates for tax rate discussions. This is not a tax bill but an early notification. It outlines the previous year's and current year's property values, tax rates set by local authorities, and a comparison of potential tax liabilities. Property owners can attend public hearings to voice opinions. Reviewing this notice is vital; if discrepancies are found, owners usually have 25 days to appeal or address them. 

Many property owners require guidance to make sense of these documents. This blog looks closer at TRIM notices and their significance because homeowners will receive tax bills in November.

Navigating the Maze of TRIM Notices

A TRIM notice is a precursor of the tax responsibilities that lie ahead. The Notice of Proposed Property Taxes provides a window into the upcoming financial obligations tied to your property. They are projections of tax rates proposed by the taxing authorities, the assessed value of your property, and the exemptions that might apply to you. Look at them as a preliminary view before the final tax bill arrives in November, enabling you to plan and budget accordingly.

Reading a TRIM notice may be overwhelming to many first-time homebuyers. However, with patience and a structured approach, you can extract the essential details critical for your financial planning:

• Assessed Value: This is the numerical representation of your property's worth determined by the appraiser. This figure influences your final tax bill.

• Tax Rates: These proposed rates vary depending upon the taxing jurisdiction. Understanding these figures is vital for calculating your estimated property taxes.

• Calculate Your Estimates: Multiplying the assessed value by the tax rates gives you a ballpark figure of your impending tax obligations.

TRIM notices include details of exemptions that might reduce your property tax load. Scrutinize these to ensure you're not missing any potential benefits. During this process, you may have additional questions. The property appraiser's office will address your queries and clarify your concerns.

The Appeal Process
It’s not rare to disagree with the figures presented in your TRIM notice. And fortunately, this isn't a dead-end. The avenue of appeal exists for this purpose. Property owners can voice their concerns and contest any discrepancies in their requests.

Initiating an appeal involves filing a documented objection with the property appraiser's office, substantiated with credible evidence to support your case. Following a thorough review, a verdict will be passed. If it is unfavorable, you still have other means to challenge it. You can contact an attorney if you have concerns about the accuracy of your property assessment.

Spectrum Title Services

TRIM notices serve as advanced notices regarding property taxation. These notices pave the way for homeowners to prepare themselves for the upcoming tax season, allowing them to scrutinize, understand, and, if necessary, contest the proposed figures.
At Spectrum Title Services, we champion the cause of guiding clients in safeguarding their cherished assets and facilitating smooth transactions, whether it's a purchase, sale, or refinance. Schedule a consultation with us today, and step into a future where property management meets peace of mind.

Title Insurance Is Armor

Purchasing property is a significant moment in a person’s life. It reflects diligent savings and meticulous planning; for many people, it will be where they build their families. That is the part that most people see and think about how. Behind every dream home lies an intricate web of legal rights, past transactions, and potential pitfalls. For these reasons, title insurance is essential and should not be overlooked. To better understand why you should have it, we will explain what it does, what it protects you from, and why every homebuyer should consider it a part of investing in real property. 

The Essence of Title Insurance 

When you acquire property, you invest in the physical house and the legal right to possess it, live in it, and eventually sell it. Your legal right to the home is known as “title.” Think of a home that was built twenty years before you purchased it. An entire story behind that house speaks to who has owned it before you. During that time, the rights may have been transferred to different owners, which may come with possible discrepancies. 

For example, a previous owner may have placed a lien on their home due to a contractual dispute with a contractor who built an addition. The person selling the house to you may have inherited the property, and their ownership of it may be in question by other heirs. These types of scenarios cause title defects, and they are next to impossible to uncover by touring the house or even doing a home inspection during the due diligence process. Title insurance protects you from these unforeseen issues. 

How Title Insurance Safeguards Your Home 

Despite equating title insurance to armor, it can also be considered an umbrella because it protects you from a wide range of potential title defects. Not only will title insurance safeguard you from the liens we discussed in the previous section (as well as the undisclosed heirs), but it also will shield you from unrecorded ones. Although there are steps to prevent it, your home could be attached to previously forged documents—any one of which can create doubt about the home’s legal owner. 

The last element to consider is how inexpensive title insurance is. The value of title insurance and its protection drastically outweighs the cost. Typically, it will be about 1% of the purchase price. Have there been instances where people have bought homes only to realize that someone other than the seller has an ownership claim on it? Absolutely, and your insurance will defend you from such claims.

Spectrum Title Services, LLC
When you are in the process of buying a home, remember that having title insurance is critical. If there are defects with your home’s title, it will shield you from potentially catastrophic issues. Think of it as financial protection and peace of mind. To continue this conversation with an attorney, contact Spectrum Title Services, LLC, to schedule a consultation and receive a quote.

Shortcuts That Are Tantamount To Fraud

This blog is based on an experience with a client who was from another state and wanted to buy property in Florida. Additionally, it speaks to the importance of listening to your attorney because these are the situations they can help you avoid. The specific circumstances we are referring to center around a client intent on buying a home in Florida. They lived in another state and were getting very harmful advice from their friends, who were not attorneys. They were trying to buy an $800,000 home but attempting to reduce the purchase by $300,000. The reasoning behind this was to reduce their property tax burden. Although the seller would get $800,000, the records would reflect a $500,000 home sale. 

This is fraud. Transparency and honesty are paramount in any real estate transaction. Deceptive actions intended to defraud another person or entity (i.e., the state of Florida) in selling or purchasing real property have significant consequences. One type of fraud involves reducing the purchase price to evade property tax evaluations. Such practices are illegal, and we will explore why trusting your attorney is crucial in navigating the real estate market. 

Real Estate & Fraud 

Fraud is a multifaceted issue. As discussed above, misrepresenting the purchase price constitutes a deception of its value. It distorts the market and will lead to skewed property assessments. In an even broader sense, it negatively impacts the overall housing market. One of the reasons it will result in negative consequences—which we will elaborate on in the next section—is that the government loses out on tax revenue that should have been justifiably obtained and collected based on the home’s actual value. 

Detection & Penalties 

Imagine a scenario where a home goes on the market for $800,000. The buyer gives the seller $300,000 in cash that goes undocumented and then coordinates a $500,000 home sale. The seller will walk away with $800,000 in total, but the state only sees that someone bought a home for $500,000. The government is unaware of the other $300,000 given before the sale. Assessors will quickly identify potential issues when the purchase price appears unusually low compared to the property’s fair market value. Lenders, too, conduct financial assessments and could deny a loan if the purchase price is suspiciously low to protect themselves as well. 

The government will get involved when there are suspected cases of fraud too. The perpetrators will face fines, and the buyer will be responsible for repaying the lost tax revenue. They will likely reassess the property’s value and charge you back taxes. A property appraiser’s office has access to an extensive database of information that can be used to determine a property’s value. For instance, looking at sales data for similar properties in the area could trigger an investigation. 

Protect Yourself & Your Investment with Spectrum Title Services, LLC

To safeguard your interests and ensure a legitimate real estate transaction, it is critical that you speak with qualified legal counsel. In addition to it being illegal, an attorney would recognize the futility and short-sightedness of buyers attempting to evade their property tax obligations. By entrusting and genuinely listening to your attorney, you will have access to essential services and protection from potential legal issues. If you are ready to buy or sell a home, contact Spectrum Title Services, LLC, to schedule a consultation. 

Demystifying Refinancing

If you are a homeowner here in Fort Lauderdale—or anywhere else in the country, for that matter—you may have come across the term “refinancing.” It may surface in conversation, or you may hear people discussing it when interest rates drop. Refinancing your home can be a very effective financial tool that allows you to improve the terms of your mortgage, lower your interest rates, or even gain access to the equity you have accumulated over time. Before you can take advantage of the things we have brought up, it is essential to understand what it means when you refinance your home. To help you with this process, we will explain why people do this and what you should think about before committing to it. 

What is Refinancing?

Refinancing refers to replacing your existing mortgage with a new one. In the opening section, we mentioned some of the benefits of refinancing, such as lower rates. Generally, after homeowners complete the process, they are left with more favorable terms and conditions that benefit them financially. To “replace” your mortgage with a new one, it has to be paid off. Your new lender will do this as part of the refinance process. 

However, because you will be working with a new lender, you can renegotiate the terms of your new mortgage that align with your current financial goals. Before we go into the next section about the factors contributing to your decision, here is a list of reasons why people do it. 

• Lower interest rates could save significant amounts of money over the life of your loan. 

• You can effectively reduce your monthly payments by extending the loan term or getting a lower interest rate. 

• Although we just mentioned you can extend your loan, you can also shorten it. Going from a 30-year mortgage to a 15-year will likely result in higher monthly payments, but you will pay less interest. Additionally, you will pay off your mortgage in less time. 

• Cash-out refinancing gives you access to your home equity. Essentially, you are borrowing against your equity, which can provide money to make home improvements, pay off debts, and use toward any other financial need. 

What It Looks Like

The first thing to consider is whether this aligns with your long-term financial goals. Secondly, it is imperative to highlight that refinancing is similar to the original process you underwent to secure the original loan. This, unfortunately, includes several elements.

• Finding a new lender

• Prequalifying for the loan through an application process

• Home appraisal 

• Underwriting and final loan approval

• Closing the loan (which includes closing costs and fees)

• Loan funding and repayment 

Before your loan can be approved, the new lender is going to evaluate your credit score, assess your financial situation, income stability, and your debt-to-income ratio. These are critical things to look at before seeking a new loan because they impact your eligibility and terms. 

Get in Touch with Spectrum Title Services, LLC
Regardless of your reasons for refinancing, we work closely with borrowers, lenders, mortgage brokers, and other professionals in South Florida. To learn more about whether refinancing is right for you, reach out to us so we can help. We can provide you with an estimate of your closing costs and other associated fees so that you can make the right decision for you. Contact us today to set up a convenient time for us to speak.

Having An Attorney During A Real Estate Transaction Protects You

Because you are reading this on our website through our newsletter, please take what we are about to say next as slightly whimsical rather than as a condemnation of the profession that we hold in high regard. Some hold the opinion that many people hate lawyers. When people perpetuate this idea, it may be rooted in bad personal experiences, how lawyers are portrayed through news outlets and on film, or because of learned stereotypes. We can be described as ruthless, unethical, and “willing” to win at the expense of others. Think about a time when a lawyer was depicted on TV as manipulating the legal system or exploiting loopholes to help their clients. With that in mind, it does make sense that people would distrust those in this profession. 

We aren’t discussing this to sway you or change your mind about any past experiences you have had with members of the legal community. You are entitled to your opinion, and we respect that. Our reasoning for highlighting this is that we don’t want a previous encounter you have had with legal counsel—which could have been justifiably negative—to harm your future decisions. Our concern is that you may avoid speaking with an attorney when you need to because you are worried about something that happened previously. 

Some Thoughts on How to Proceed

One of the reasons attorneys have initial consultations is to ensure they are the right fit for your case. Though it may seem strange, a person may contact a real estate attorney (like us), assuming they practice family law. This is an exaggeration, but it highlights how an attorney uses a consultation to verify that they have the background and experience to represent you in the way you need and deserve. On the other end, you, the client, may meet with an attorney and conclude that this is not the person you wish to work with, and you may arrive at that decision for several reasons. Remember, the consultation is for you too. 

Real Estate Transactions

Real estate transactions can involve complex legal documents and processes. We are not stating this because we want to sell our value but rather as a statement of fact. Imagine you are a buyer interested in purchasing commercial real estate in Fort Lauderdale. This specific property includes several businesses, offices, retail stores, and restaurants—which is not uncommon for the area. Because this building has multiple tenants with different lease agreements, your attorney will provide you with critical services. 

Your lawyer can research the transaction and explain the obligations, restrictions, and even the potential risks associated with each tenant and lease. You may also have to negotiate with (or renegotiate) lease terms, rates, and extensions during this time. Because your attorney understands your goals, they can advise and proceed according to your interests. It is beyond the scope of this article to elaborate on each one, but here are some other issues that may surface during this transaction.

• Lease assignments and sublease agreements

• Estoppel certificates

• Land use and zoning considerations

• Financing the sale and assisting during the due diligence process

Spectrum Title Services, LLC 
You may have read the previous entry and said that you are buying a home for your family, and your real estate transaction will not be that complicated. However, this is likely one of your life's most significant financial decisions. Our office will guide and assist you with the contractual review, negotiation, title search, due diligence, and closing. Regarding closing, you want to sit down at the table knowing that all your documentation has been properly prepared, executed, and filed with the appropriate entities. Before you embark on your next transaction, contact our office for your consultation.

What Happens During A Residential Real Estate Transaction

Buying residential real estate may happen only a few times in your life. Because of how infrequently people purchase homes, they may need to remember what occurs during one, which can be an excellent refresher for anyone. Anyone who has gone through the process understands how eager the buyer and seller are to get to the closing table. After accepting an offer, you share this moment with your friends and family. Though transactions differ, considerable work tends to be done before you get to the closing table. 

The components that generally take the most time are the due diligence period and getting final loan approval. Most people are so relieved to get to the closing table that they barely remember what happened. It’s understandable, especially considering how momentous the occasion is. With that in mind, here’s a brief explanation of what can happen when you finally sit at the closing table to get your new home. 

What Happens At the Closing Table  

When you attend a closing, typically, there will be several key people there. Although we included both in the list below, please note that the buyer and seller may choose to sign all the required documentation separately. For example, the seller may sign everything electronically before closing, meaning only the buyer must attend. Whereas everyone listed could be present, that doesn’t mean everyone will be. Still, these are all the people that make a residential real estate transaction possible. 

• The buyer

• The seller

• Real estate agents for both the buyer and seller

• The closing agent (generally an attorney or someone who represents the title company)

• The lender 

• The attorneys for both parties 

• A notary public 

There will be a significant amount of paperwork involved. The types of documents that you are required to sign will differ by transaction, but here are several key ones that you can expect to see:

• Deed

• Mortgage 

• Closing Disclosure 

• Promissory note

• Affidavit of title

• Bill of sale

• Title insurance policy 

• Any relevant disclosures 

After all the paperwork has been signed, the buyer/lender transfers the necessary funds to complete the home sale. Your lender will provide instructions on how this will be achieved before the closing date. Because the title is everything, it must be transferred to the buyer after the funds have been successfully issued.

In addition to the seller getting paid, some of those funds that the buyer/lender provided get distributed to paying off any liens (e.g., the remaining balance of the seller’s mortgage), and the real estate agents are entitled to a percentage of the sale price. One of the best moments is when your real estate agent or attorney informs you that you are “on record.” The deed has been recorded in the county recorder’s office. People enjoy this part because it signifies that a transfer of ownership has occurred and that the public record reflects this. Lastly, you will receive the keys to your home. The rest is up to you.

We’re with You From Contract to Closing
Whether you are a first-time buyer or have purchased multiple investment properties, Spectrum Title Services, LLC, will be with you from the moment you have a signed contract until you discover you are “on record.” We have extensive experience with residential and commercial real estate transactions, refinancing, and title insurance. Contact us to speak with an attorney about any of the aforementioned legal services, and we will be happy to schedule a consultation with you.

How To Protect Your Largest Investment For Free (Part 2)

Last month, we discussed the value and importance of filing for homestead exemption. We looked at it through the lens of property taxes and how much money you could save. However, this series’s title also mentions how you can protect your home, and this month’s article closely examines how the homestead exemption can achieve that. 

Protection from Creditors

As frightening as it may be, imagine a scenario involving a car accident where you are at fault. Because several other cars were involved, you don’t have enough liability insurance to cover other people’s property and medical bills. If you ultimately have a recorded judgment against you, someone could come after your assets and home or have a lien placed against your property. Although this is a fictitious scenario, that doesn’t mean it can’t happen. Ask yourself whether you are protected. Those who have filed for homestead exemptions will likely say that they are. 

The Florida Homestead applies to everything from single-family homes to mobile homes, as long as they are your primary residence. You should also note that your home is protected regardless of its worth, but it limits how much land you can safeguard. It restricts you to your property size up to ½ acre if you live within a city and 160 acres outside of a city. (We will discuss how much it can appreciate in the final section.) 

The homestead exemption does not protect your home if it was bought with funds connected to illegal activity. Mechanics' liens are also not covered because you likely owe someone money for improving the home you are trying to protect. Remember, most people already have liens on their homes because they borrowed money to purchase them. Defaulting on your mortgage or a home equity loan still enables a creditor (lender) to seize it. 

Because the homestead exemption can be applied to condominiums, we must address special assessments and HOA dues. Special assessments on condominiums can be significant, and it isn’t impossible to be told you owe upwards of $10,000 after an HOA meeting where a vote was held. Failing to pay dues or assessments could result in a lien being placed on your home. You are not covered if you file for a homestead exemption after a lien of this nature has been filed.  

Another Area of Consideration

We are emerging from a very hot real estate market, which is accounted for in the homestead exemption. Under our Florida “Save Our Homes” Amendment to the Florida Constitution, your home’s assessed value cannot increase by more than 3% annually. It cannot exceed the inflation rate if it hasn’t reached 3%. When you sell your home, you can carry over the Save Our Homes protection onto your new one. 

Meet with Spectrum Title Services, LLC

When you are ready to buy, sell or refinance your home, contact the trusted team at Spectrum Title Services, LLC. If you have a homestead on your current home, we can explain how you can obtain one on your new purchase to limit your potential tax burden. Contact us today for all residential and commercial real estate closings to schedule your consultation.

How To Protect Your Largest Investment For Free (Part I)

Those buying property in Florida for the first time must understand their opportunity. This two-part series will outline the Florida homestead, how it benefits you, and what you must do to take advantage of it. We aim to convince you why it's important and give you the tools to obtain it. Next month, we will release a blog that breaks down the homestead exemption to give you an even greater command of its benefits. If you missed the March 1st, 2023 deadline to file for your 2023 Homestead Exemption, don’t worry - you can still file for your 2023 Homestead Exemption up until September 18, 2023.  After the late filing deadline of September 18, 2023, you cannot take advantage of your Homestead Exemption until 2024.

What Is a Homestead Exemption?

The tax burden that your home carries is directly related to its value. One of the benefits of the Florida homestead exemption is that you can reduce the taxable value of your home by up to $50,000. (This should not be confused with assessed or just value.) Your home’s value doesn’t decrease to future buyers, but it does in the eyes of the government. In Florida, taxes are assessed by the county’s appraiser and will fluctuate by location. The average cost of a single-family home in Broward County was $282,400—and they pay close to $2,756 in property taxes annually.  

You must understand how the tiered system works to determine how significantly you can reduce your property taxes. (Here’s a pro tip: Remember the number 25.) Suppose your home is worth $100,000 because it is a manageable number to work with. This is how the tiered system works with this home:

• The first $25,000 of your home is exempt from all property taxes. 

• You pay the taxes on the next $25,000

• The next $25,000 applies to the assessed value between $50,000 and $75,000

• The remaining money ($25,000) is taxed fully. 

How Do I Qualify?

This only applies if you own and use the home as your primary residence. You must have lived in the house as of January 1st of that tax year. How this works: when you file for the 2023 tax year, you must have closed on your primary residence on or before December 31, 2022. Additionally, Homestead Exemption applies to properties less than ½ acre, if located within a municipality or 160 acres if outside of a municipality. The best part is that you can do this entirely on your own. For example, if you live here in Broward County, you can file here. For those living elsewhere, simply do a basic search by typing in Your County + Homestead Exemption. You will likely be led to your county’s property appraiser. 

Get in Touch with Spectrum Title Services 

We encourage you to pursue a homestead exemption to reduce your tax burden, and this is something that doesn’t require you to have an attorney. When you need to buy, sell, or refinance residential or commercial property (or a title quote), contact Spectrum Title Services to schedule your consultation. 

COVID-19

Dear Realtors, Clients, and Friends,

Please be aware that the Florida Realtors have just released the Coronavirus (COVID-19) Extension Addendum to Contract. This form was created in response to the global pandemic affecting real estate transactions throughout Florida.  It can be used for the Contract for Residential Sale and Purchase, Residential Contract for Sale and Purchase, Vacant Land Contract, and the Commercial Contract.  This addendum allows for extensions for certain dates and time periods that have not yet passed or expired, which include the following:

·     Closing Date

·     Financing Period

·     Inspection Period

·     Title Cure Period

·     Feasibility Study Period

·     Due Diligence Period

·     Homeowners’/Condominium Association Approval Period

Please understand that these extensions were enacted to alleviate the impacts COVID-19 has on real estate transactions.  Such impacts may include: travel restrictions, governmental or self-imposed isolations, financial institutional closures, recording and governmental closures, title company or law firm closures, inactions by homeowners’ associations or condominium associations, and/or any real estate vendor-related cancellations/closures.  

If you or your client are affected by any office closures or closures that hinder the ability for your transaction to move forward or close on time, it is recommended to come to a mutually agreeable extension period.  

Please note that the “Force Majeure” clause in your contract may not apply to COVID-19 and your contract – so it is important that you read your contract carefully.  For example, the Florida FAR/BAR Contract’s “Force Majeure” clause allows for an extension for up to 7 days after the force majeure event does not prevent performance.  However, it allows either party to cancel the contract if the force majeure event continues for 30 days beyond the closing date.  COVID-19 may not trigger the “Force Majeure” clause to your circumstance – reading the FAR/BAR “Force Majeure” clause specifically, Florida Realtors’ General Counsel Juana Watkins stated in an interview published March 17, 2020: 

When it comes to COVID 19, many of the listed events can be ruled out. This is not a hurricane, a flood, extreme weather, an earthquakes, fire, war, insurrection, or other acts of terrorism. That leaves parties with just two events under the Florida Realtors/ Florida Bar force majeure clause: acts of God or unusual transportation delays. For a party to be protected, those events need to prevent performance or otherwise make it so that services, insurance, or approvals essential to closing are disrupted or delayed. Transportation delays is a self-explanatory concept. This is why those facts you call and give us on the hotline matter greatly. While I am not saying force majeure will never apply, we have yet to hear a set of facts that would likely meet that legal threshold. But remember, things are rapidly changing.

What we can say, is that the party who is trying to avoid liability should do everything in his or her power to perform. The party who seeks to avoid contractual obligations has the burden of showing precisely why they were prevented from performance. For example, fear of a tumultuous stock market future is probably not good enough. Neither is fear of the disease when a closing agent has offered a reasonable way to collect signatures or other solutions to get a deal closed.

On the other hand, if someone has been placed in government-ordered quarantine in a foreign country where required closing services (notary, for example) are not available, this is a much more plausible case to argue for an extension or other method to avoid liability. If, in the future, government offices that record deeds are closed, or if other services related to closing become impossible to procure, this also could become a plausible case for someone to bring up.

The bottom line - please encourage parties to compromise and work together as often as possible. If they are unable to compromise, encourage them to seek legal counsel before attempting to avoid an obligation.[1]

A Link to “Florida Realtors Legal Update on the Coronavirus Pandemic” can be found here:

https://www.floridarealtors.org/news-media/video-library/sharing/florida-realtorsr-legal-update-coronavirus-pandemic

We will continue to monitor any other changes impacting the real estate as they become available.  As of the date and time of this publication, all e-recording counties in the State of Florida are still accepting e-recording documents. Miami Dade County’s Courthouse is closed, but they are still accepting e-recording and mail.  Duval County is experiencing delays with their e-recording. 

Disclaimer: This publication is for informational purposes only and is not intended to be construed as legal advice.  Please note that each situation should be assessed on a case by case basis.  If you or your client have a specific legal question about an issue revolving around this addendum or its impact on your transaction, it is highly recommended that you seek the advice of a licensed Florida Attorney immediately.  You or your client may have continuous contractual obligations that may impact your real estate transaction.

[1]Juana Watkins, Esq., Florida Realtors® Legal Update on the Coronavirus Pandemic, Florida Realtors®, (March 17, 2020) https://www.floridarealtors.org/news-media/video-library/sharing/florida-realtorsr-legal-update-coronavirus-pandemic.