Add to the Deed or create a Cohabitation Agreement?

[floridagirl75]

Jurisdiction

Florida

I own a home, and my fiance lives with me and has put a substantial amount into the home. To protect her investment, we were looking into adding her to the title/deed. I am concerned about a few things I have read regarding this:
1. There is a mortgage on the home with an escrow account. Is due on sale clause an issue?
2. The mortgage is $502K, what type of fees are we looking at for stamps?
3. What type of tax implications will we face?
4. Will I lose the Homestead Exemption?

We aren't getting married for a couple years, so we want to have something in place until then.

 

[zddoodah]

I own a home, and my fiance lives with me and has put a substantial amount into the home. To protect her investment, we were looking into adding her to the title/deed.

FYI, your "fiance" (or "fiancé") is the man you intend to marry. A woman you intend to marry is your fiancée.

More to the point, was the money she put into your home done pursuant to any sort of written or verbal agreement by which you agreed to repay her or give her anything in return? Or was it merely a gift?

1. There is a mortgage on the home with an escrow account. Is due on sale clause an issue?

I don't know. What does the "due on sale" clause say? They're not all identical.

2. The mortgage is $502K, what type of fees are we looking at for stamps?

Huh?

3. What type of tax implications will we face?

No one here knows anything about your personal financial situation. That said, until you're married, there is no "we" when it comes to income tax. Consult with a tax professional. Since you have other legal issues, you might want to consult with a tax attorney or an attorney who has a tax professional on staff or is otherwise strong on tax issues.

4. Will I lose the Homestead Exemption?

No.

 

[flyingron]

Understand that you can't add someone to the deed. Each deed reflects a conveyance of some ownership interest from one person to another. The house title is the history of all the deeds over time.

You can deed part of the property to her, but understand you are giving her an irrevocable gift of whatever you deed away.

Federal law restricts due-on-sale clause enforcement when you add a SPOUSE to the title. THere's no protection for"fiances." Note, however, that unless you are married (or you refinance in both your names), you remain solely responsible for paying the mortgage, even if you split up. Marriages are easier to get out of than mortgages.

The recording fee (stamp) in Florida is .60/$100 of the value transferred. Again, transfers to SPOUSES are exempt, but not to fiances.

As for the homestead exemption, those who would otherwise qualify for it can invoke it up to the overall $25,000. The rules depend slightly on how the tenancy is held. You may end up splitting the $25,000 exemption between the two of you, or one could claim it and the other not.

As for taxes, a lot depends on just how much the property is worth (not just what is left on the mortgage).

Frankly, it would be easier if you cooled your jets on the transfer until after you are married.