Many have heard of Florida's Homestead protections from creditors, commonly referred to as the Homestead Exemption for your real-estate. But what is it really and how much can it protect?
For the full text of Florida's Homestead Exemptions, click here. However, if you want to know what Florida's Constitution says in plain English; Article X, Section 4 of the Constitution essentially states that in Florida, no-one can force you to sell your home and then use the money earned in that sale to satisfy a debt, and this is true even if they have a judgment from a court showing they are legally entitled to their money.
What is included in the Homestead Protection?
The Florida Statutes provide that only your principal place of residence can receive these protections. So, if you're fortunate enough to own more than one property, only the main property where you actually reside (or where you reside the majority of the year) will be considered your “principal place of residence” to be able to be protected from creditors. Also, the home needs to be owned by a “natural person” a.k.a. you! If you purchased the home in the name of a business, then it is not eligible for any Homestead protections, even if you are a sole proprietor of that company.
Some may ask, does the size of the property matter? The answer is yes. Florida law will only protect a home if certain acreage requirements are met. If your home is located within a municipality (an organized city or town), you are only protected for your home and up to one-half of an acre of land. If your home is located outside a municipality (for example, an unincorporated area of a county), then your home plus up to 160 acres of land are protected.
Do Homestead Protections Work in Foreclosure Matters?
No. There are certain debts, such as a mortgage to purchase property, which will not be included in Homestead protections. Think about it: if a Florida resident could buy a house using money from a bank, then stopped paying their mortgage, and asked a court to prevent the bank from foreclosing on (selling) the home to get their money back, then the bank would have no way to recover their money, and banks would stop lending money to Floridians. (Who would trust people to pay it back without any incentive?) Therefore, mortgages are special matters that won't see any Homestead exemptions.
So I have a Judgment Entered Against Me, Does Homestead Help?
Yes. Even where a court has determined that you legally owe money to a business or another person, the creditor will not be able to make you sell your house and use the money gained from that sale to pay back your creditors. This is somewhat unique to Florida, and many states do not offer this kind of protection. The Judgment will be allowed to accrue interest at a rate set by the State Legislature, but you can't be forced out of your home to sell it.
That said, resolving judgments is still an important need for your personal finances, and the Holland Law Group can certainly help you in all manner of debt settlement, whether it be in active litigation, or an overdue and unpaid judgment. We help people in your situation each day, across the state of Florida, from Miami to Tampa to Jacksonville and everywhere in between. Let us help you too! Please call us at (941)-744-5450 for a no-cost consultation to learn how we can help.