(MCT)—QUESTION: We began our short sale on our condo last year, and we’re still not finished. We were initially told that if we are current on our payments and our short sale is complete, we would be able to purchase another home without a problem. Is this true?
ANSWER: If you never missed a payment, your credit should still be reasonably good and there are banks that likely will lend you money right away. But most people who complete short sales fell behind on payments, and it could be a couple of years before they can get another loan. Each lender has dozens of programs that you may qualify for and there are literally hundreds of lenders out there. Obviously, if you’re paying cash, there’s nothing stopping you from buying a home at any time.
Q: I bought a home a few years ago when I was single, and I recently got married. I put my wife’s name on the home so that we own it together, and we recorded the deed with the county. I received a fairly large tax bill for the transfer. I didn’t sell my wife half the property; I just put her name on it for estate planning purposes. Do I owe this tax?
A: Yes. Whenever you transfer a property in Florida, you must pay documentary stamps tax on the sales price. It doesn’t matter to whom you’re transferring it or what type of deed it is. If you are not selling the property for money and there is a mortgage on the home, the tax man will consider the unpaid balance of the mortgage as the sale price when computing the taxes that you owe for the transfer.
If the property is owned free and clear of any mortgage and you transfer to your spouse or close relative and the only compensation that your receive in return is their “love and affection,” then there is no tax. There are also some other exceptions, such as when you have to deed the marital home to your ex-spouse pursuant to a court order, or when you transfer your home to a revocable trust for estate planning purposes.
Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar.
©2012 the Sun Sentinel (Fort Lauderdale, Fla.)
Distributed by MCT Information Services
