Florida Helps Small Business Affected by Coronavirus

Coronavirus Action Alert #2 From Our Business & Finance Law Teams:

Rana M. Gorzeck, Philip H. Ward, and Adam R. Seligman

At the request of Governor Ron DeSantis, the State of Florida has just made available to small employers in Florida who experience economic injury from COVID-19, short-term, interest-free bridge loans of up to $50,000.00 for one year.  Small employers are defined as those who have from 2 to 100 employees.  The bridge loans may be applied for until May 8, 2020 and are intended to provide immediate cash relief until either a Federal SBA loan or commercial loan can be obtained.  The loans are being administered by the Florida Department of Economic Opportunity (DEO).

For further information, please click on the following link: https://www.enterpriseflorida.com/news/governor-ron-desantis-activates-emergency-bridge-loan-program-for-small-businesses-impacted-by-covid-19/

The Ward Damon team will continue to monitor changes to the rapidly evolving coronavirus crisis along with the progressing response from all of our national, state, and local agencies, and provide updates as needed.  If you have any Business or Finance questions related to the COVID-19 crisis, or need help with your loan transactions during this time, our Ward Damon Business & Finance Law teams are here to help you.  Please call us at 561-842-3000, or you can contact us directly at: Rana M. Gorzeck, Philip H. Ward, and Adam R. Seligman.

Reverse Mortgages: Helping or Hurting Seniors?

By Michael J Posner

Recently an editorial published in USA Today on June 13, 2019 (read here: tinyurl.com/y36lvwjp) basically viewed reverse mortgages as simply predatory lending designed to steal seniors’ and the heirs’ homes without any benefit or knowledge.  As a board-certified real estate attorney and Florida HUD Commissioner who has seen and dealt with many reverse mortgage foreclosures, I do not agree with this perspective for a number of reasons explained below.

First, the editorial fails to clearly discuss several important facts:

1. Without the loans, many seniors would have been forced to sell the homes anyway, due to the inability to pay maintenance costs (such as major structural repairs, and roofs), existing loans (which may be burdensome), or taxes and insurance;
2. No one forced these seniors to take the loans and spend the money they received, even if spent frivolously;
3. A majority of foreclosures occur not due to defaults relating to non-payment of taxes or insurance, but due to either abandonment of the home (residing in the home is a condition of getting and keeping the loan) or death;
4. Claiming that the heirs lost out on getting the home due to the reverse mortgage is a false premise, because it presupposes that the heirs deserve the home even though their parents needed and got to enjoy the benefits of the reverse mortgage money; and
5. Many foreclosures occur simply because reverse mortgages were granted before the crash, and the monies given were based on a higher pre-crash value. Combined with the accrued interest over 10 to 15 years (a key to how these work, seniors pay nothing during the term of the loan), and all the costs of sale (as high as 8% for real estate commissions, taxes, transfer taxes and title insurance), there is little to no equity left to interest the heirs or the estate to consider selling the properties.

Eight Common Real Estate Mistakes

By Michael J Posner

After more than 30 years of concentrating my legal practice in real estate matters, below is a brief listing of common mistakes I repeatedly see.  Read below and find out how a few quick fixes can save you time, money and headaches.

1. Deeds Without Estate Status:

You want to add dad, mom or a sibling to your Florida property, so you get a Quit Claim Deed from an out-of-state lawyer, an office supply store or online, fill it out and mail it in to be recorded.  Three years later they die, and when you go to sell the property you discover that in order to clear their interest, you need to file an ancillary administration in Florida.  An easy fix could have saved you $3,000 and a few months of time.  You eventually close and share the proceeds with their heirs, however this can be avoided by using the proper language on the deed.  If you want the property to go to everyone’s heirs, do nothing, but if you want to be sure that the property goes to the surviving grantees, simply add, “joint tenants with full rights of survivorship, and not as tenants in common” after the grantee’s name. Upon their death, the title goes to the remaining grantee without probate.

2. Second Home/Condo:

If you own a second home/condominium in Florida and are a resident of another state, you can avoid two probates by simply deeding your second Florida property to yourself for life with a remainder to your chosen heirs.  Then, when you die, no probate is necessary.  You can even keep full control of your property by adding Ladybird Powers to your Life Estate Deed, which means you can sell or mortgage your property without your remainderman’s (person who inherts property) consent.