Preparing a Deed: DIY vs. Hiring an Attorney

By Kelly Anne Sifford, Esq.

Preparing a Deed:  DIY vs. Hiring an AttorneyThere may come a time when you want to transfer your property and need to prepare a deed to accomplish that goal. There are plenty of us who, with a little time and internet access, enjoy control and savings on the little things in our lives. The internet is full of helpful do-it-yourself websites, samples, forms, and tutorials for just about everything. So, why spend your hard-earned money on a professional when you can read a helpful article, watch a DIY tutorial, or hire an internet lawyer for the bargain price of $19.95 for deed preparation. For the same reasons you should not rely on healthcare websites to diagnose your recent symptoms. Within 15 seconds of entering your current symptoms into an internet symptom checker, you will be bombarded with the possibility that you are concurrently suffering from 27 separate illnesses. While the internet is brimming with information, it is not always a reliable, certified, or professional source when dealing with something as valuable as your home, real estate, or your health. Some things are better left to the professionals.

The most important reason to seek the help of an attorney to transfer property is because they know what questions to ask. While the information you obtain during your research may provide the basic foundation for preparing a deed, it is unlikely you will encounter every necessary consideration for each individual circumstance. There are many provisions and issues to consider before you even begin drafting a deed. All states have different requirements for the form, language, statutes, style, and recording of your deed. Ensuring that your document meets Florida’s requirements is just one hurdle. What type of deed do you need to prepare? There are more than a few options, the most common of which are quit claim deeds, warranty deeds, and special warranty deeds. Each deed offers a different level of guarantee to the grantee about the right to convey, and the encumbrances against the land. Lawyers are tasked with understanding the myriad of issues and laws that should be considered when preparing your deed. Spending a little money on a lawyer now can save you the costly litigation that may follow if you attempt to draft it yourself.

Among the most important considerations when drafting a deed in Florida are homestead and tax laws. Florida’s homestead laws provide restrictions on descent and devise, creditor protections, and tax benefits. In many cases, a homestead provision is required to establish the homestead status of the grantor. Under the Florida Constitution, the owner of homestead property generally cannot devise their homestead to just anyone if they are survived by a spouse who has not waived their rights, or if they are survived by a minor child. If you have a minor child, the deed will affect whether or not your spouse inherits the house outright, or just retains what is called a life estate. In short, the tax advantages of Florida’s homestead laws also restrict your ability to transfer property depending on how it is deeded.

The first tax consideration your attorney will likely address is the documentary stamp tax. Most Florida counties assess this tax at 70 cents for each $100 of consideration. In some circumstances, even transfers of property to your irrevocable trust, your spouse, or to an entity could be subject to this tax if there is a mortgage on the property, regardless of whether the grantor remains personally liable for the mortgage. In other situations, there may also be capital gains taxes on gifted property if the grantee assumes a mortgage. Other taxes that should be contemplated are the generation-skipping transfer tax, estate taxes, taxes that apply to transfers from the estates of non-resident aliens, taxes on transfers to and from non-citizens, and the list goes on. Spending the time and money on an attorney to prepare the right deed now will be considerably less expensive than finding yourself in trouble with the IRS or with an unexpected bill.

Other unexpected bills you may incur upon an invalid deed transfer are litigation costs. If you execute a warranty deed without title insurance to back it up, you may find yourself responsible for claims on the title from others asserting an interest in the property. If you improperly execute the deed a judge could rule that the transfer is void. Worse, a deed not properly executed in an attorney’s office could leave you open to challenges on its validity
concerning the capacity of the grantor. The possibility of costly complications later warrants the minor expenditure of an attorney now to determine that everything is being transferred correctly. After all, upon receiving an internet diagnosis, you are not likely to try to perform the operation.

This Article does not constitute legal advice and may not be relied upon as such. Each individual’s facts and circumstances are different. If you have any questions regarding your particular situation, please consult with legal counsel.

Kelly Anne Sifford, Esq. practices in the areas of estate planning, business litigation, civil litigation, and community association law. Ms. Sifford received her J.D., with honors, from Ave Maria School of Law.

WOOD, BUCKEL & CARMICHAEL
239.552.4100
www.wbclawyers.com

2150 Goodlette Road North . Sixth Floor . Naples, Florida 34102

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