[00:00:00] Speaker A: Okay, everybody, welcome to our first episode of Ask Joe whatever.
This is where you can ask me whatever you want. We prefer to keep it legal. But hey, if you can have a question about business or life in general, feel free to ask, and if it fits, I'll answer it. The big thing is we want you to ask questions. You can, you can send them to us through any of the social media channels. We have Facebook, Instagram, TikTok, YouTube, however you want to instant message us through there, you can record a voice recording and send it to
[email protected]. We may play it on the air if you send us a voice recording. And you can also text us to 3868-3210 text us a question anytime, day or night. That is a real text number. We do monitor that, and we will take those questions and make them part of a show in the future if they come up. But today we got some questions, a lot of questions about the new squatters law. And so I've got Rick, our director of marketing is here. He's the producer of the show. He puts it together for us. So whenever I look good, it's because of Rick.
He keeps everything going. And so Rick's going to give me the questions in the back background. I'm going to answer them for you as we go through. So, Rick, what's our first question today?
[00:01:32] Speaker B: Okay, first up, how does a land trust differ from other forms of property ownership, such as direct ownership or corporation?
[00:01:44] Speaker A: First and foremost, those are considered to be entities. They're like people. They stand on their own. Once they're formed, they are filed with the state, and also they have to file their Fincen, BOI reports, business ownership, interest reports with FinCEN. So those are big requirements of an LLC or a corporation. And also there are giant databases out there in each state that have, in most states, except Wyoming and Nevada and Delaware, that have the information of who owns those companies. So anybody can look up those entities and see the names and addresses of the owners or the officers or the managers, whoever it may be, they're going to have that information freely available. By the same token, they can look up the name of the person and find the company so they can do reverse searches as well, especially in Florida with a land trust. Land trust is not an entity. We made that very clear in the land trust statute. It does not stand on its own. There's nothing filed with the secretary of state. There's nothing filed in the public records as to who the beneficiaries are of this trust. But a trust requires at least, land trust requires at least three elements. Number one, you have to have a trustee, you have to have a beneficiary, you have to have a trust agreement, and then you have the deed that puts it into the trust. So with the land trust, the person puts deeds, the property to the trustee, and there are special powers on that deed that tell the world that the trustee has full authority to do everything with that property that ever needs to be done. So the legal title, the name that shows up in the public record is the name of the trustee. And that's the only person or entity that shows up. In our case, it's an entity. We have land trust Service Corporation, we have trste, and we have other entities that act as trustee under the my land trustee brand. And that name shows up on the official records. So if anybody searches that property, or if they search our company, they're going to find that we are the trustee of that property. What does not show up is the name of the beneficiaries under the trust agreement. So the trust agreement is between the trustee and the beneficiaries, and it's sort of a contract between the trustee and the beneficiaries that says that the trustee holds the title to the property, the legal title to the property. It holds the equitable title to the property. And the beneficiaries are the ones who tell the trustee what to do, limits the powers of the trustee as to what they can do without the beneficiaries prior permission. So the land trust agreement tells us as trustee, what we can and can't do. However, that trust agreement is never made public. No one knows who that beneficiary is. So anyone searching the beneficiary's name cannot find the property, and anyone searching the property cannot find the beneficiary, unlike an entity like an LLC or a corporation, where they search the name of the managers or the members or the shareholders and they can find the company, or they can search the company and find the officers and directors of the company. So it just keeps your name off of the records. But in a lot of ways, it still operates the same way as a corporation or an LLC in that the members and shareholders and officers run the company. The beneficiaries of the land trust tell the trustee what to do, and the trustee executes those directions under the trust agreement and does what the beneficiaries tell them to do with the property whenever it's needed. So you sort of get the best of both worlds. You get the privacy and you also still get the limited liability, just like you do with a corporation or an LLC or a partnership. Limited partnership. So in some ways, they are alike, but the anonymity is that extra little sprinkle on top that makes them better in a lot of ways when it comes to owning real property or holding mortgages.
[00:05:59] Speaker B: Okay, so you touched on this partly in your first answer, but how does the process of setting up a land trust work in terms of our office?
[00:06:12] Speaker A: That's another question we get is, what's our process for setting up a land trust?
It's really easy. There's a couple ways. Number one, if you're familiar with land trust and you know how they work and you don't have really an questions, you can just go to our website, mylandtrustee.com, and enter an order, and you fill out a form online that gets submitted to us with the information. If we have any additional questions, we'll call you or email you and get more information. But with that information, we go ahead and we prepare the land trust. If necessary, we'll prepare a deed from the current owner into the trustee of the land trust, and then we send it out. If it is closing, at a title agency or a law firm, we will coordinate with them to get our documents to them so that they get everything signed at the closing, and then it comes straight into the trust there. If we need to hide the purchase price at closing, we will work with the closing agent to make sure that they understand how that process works, and they will take care of everything along with us to make sure that the purchase price does not show up on the public records at after the closing. A lot of investors and a lot of people just don't like that purchase price to show because they don't want anybody to know how much they paid for the property. Then after all that is done, everything is signed.
If it's already your property and you just want to put it into trust, then we will take care of recording the deed. We do that electronically, and then once the deed is recorded, it's in our name. As trustee of the land trust and you are still the beneficiary, or whoever you've said is the beneficiary, is your beneficiary. And going forward, all the mail starts to come to us. All the text messages, phone calls about the property, hoa violations, leases, everything comes to us and we sign it, or we scan it, we put it into our system, we upload it, we share it with you through our secure system so you can access that anytime day or night, and you will see your documents. Any mail that's come in that's important, any junk mail is shredded, as well as the mail after it's sent to you. We shred that. If it's something really important, let's say we get served with a lawsuit, we will scan that to you, but we're also going to mail that to you or overnight it. If it's an original document, like a, the actual deed or title policy or a promissory note, something like that, we're going to ship that to you in hard copy. We're not going to retain originals, but we will also scan it into your file so you'll always have access to it that way.
The other question that usually follows onto that is, what's the procedure when you're selling a property in trust? And that one's a big one because we've had a lot of people, especially lately, who are signing their own contracts, and we don't want you to be doing that. If we're your trustee, let us sign your contracts. Let us sign your listing agreement, because if you're signing your contract, you've sort of blown the anonymity at that point.
So you go ahead and negotiate the contracts, you negotiate the listing agreements, you negotiate the leases, whatever. Then after that's all done, send that to
[email protected].
We will take care of getting that signed and processed and back out to you. 99% of the time, we sign everything the same business day. We get it. If it comes in on a weekend or late in the day, it may be the next business day that you'll get it. But we will take care of getting that all signed. If it has to be notarized, it's no problem. We have lots of notaries in our office. So we'll sign it, get it notarized, witnessed, whatever it takes, and get it back to you as quickly as possible for a closing. Then we again will coordinate with the title agent who is handling the closing, whether that's a law firm or a title agency. We will work with them and you as the beneficiary to get everything signed, get everything in, get everything signed, get it back to them in time. We like to get everything at least the day before the closing, if not two days before. That makes it really much better. We get everything signed, we scan it back to them, then we overnight the documents back to them so they have the hard copy originals and then the money. Sometimes the money from the closing, the sales proceeds, sometimes the title agent requires that they come to us. That's no problem. They come into our trust account, and then we wire them back out to the beneficiary, typically the same day or the next business day at the latest, or our preference, if possible, if the title agent will do it. They wire the money directly to the beneficiary to you, and that saves us all a lot of time. The money comes straight to you as a beneficiary and doesn't have to come through us. All tax filings are made directly to the beneficiaries of the 1099 is issued directly to the beneficiary from the closing. So it's actually a very simple process, and it saves the beneficiary, our clients a lot of time, because now they don't have to meet with a notary to sign their documents. They don't have to find time out of their day to do all of that.
Find witnesses, find the notary, or have a notary come to them, or them go to the closing office to do their closing. So it's a big convenience for them that we get it and we can sign it, and our client, the beneficiary, can be anywhere in the world at the time. They don't have to worry about remote online notarization. They don't have to worry about, again, meeting with a notary or anything like that, finding the witnesses on their own. They just tell us, yes, everything's good, go ahead and sign it. We sign it and send it back. The money shows up in their account and they're set. Very little inconvenience for them at all to sell the property.
[00:12:13] Speaker B: Okay. What are the tax implications of owning property through a land trust?
[00:12:22] Speaker A: Really? Nothing.
Everything. It is a disregarded entity as far as the IR's is concerned. And for all tax purposes, the land trust does not exist. Everything flows straight through to the beneficiary or beneficiaries.
Technically, if you have more than one beneficiary, you should get a tax id number for the trust, but as a partnership, because multiple people own it together.
I'm not talking about a husband and wife, but just business partners. If it's in your human names, like Rick and I own, are the two beneficiaries of a land trust not married, not related in any other way? Then we're a partnership. So we would file a form 1065 every year. So we technically need to get a tax id number separate for that land trust because it's operating as a general partnership, and then we file a form 1065 every year. But otherwise, if it's a husband and wife, if it's your LLC, if it's your corporation that is the beneficiary of the land trust, everything's just going to pass through. If it's you individually, it's going to show up on your form 1040. If it's your LLC or your corporation, it's going to be on form.
If it's a single member LLC, it's going to pass straight through again to the individual who owns that LLC. If it is a corporation going to go through on their 1120, and if it's an S corporation, it'll go straight through to their 1120s. It's as if the land trust just never existed as far as the IR's is concerned.
With that said, with 1031 exchanges and land trusts, they actually give you a lot of flexibility because just like a single member LLC, a land trust, because it is a pass through entity, the only thing that has to match on the replacement property is the tax id number. So the ein of whatever or Social Security number of the person or the ein of the entity that's the beneficiary, that Social Security number or ein simply has to match the replacement property ownership. So you could sell a property in one land trust with one name and replace it with a 1031 exchange with another property in a completely separate trust. But so long as the EiN or Social Security number of the beneficiary is the same between the two trusts, that's all that would matter, and the 1031 exchange can occur. So that's a big tax question. I get a lot whenever it comes to land trusts and how they work. The 1031 exchange is always a big question there on that, but we found that we tell people, it's like, fine, let's sell the property out of this land trust, close that land trust, and then they go, but I'm buying another property in another jurisdiction that doesn't have land trust. Maybe I'm going to Ohio to buy the replacement property. We go, no problem. Whatever your EiN or Social Security number is of this land trust, just form an LLC that has the same EIN that passes through to that same EIN or Social Security number for the Ohio property. Now, you'll use actually relinquish out of a land trust and replace into an LLC in another state. And as long as the eins or Social Security numbers match of the beneficiary and to the pass through entity of the LLC, there's no tax consequence there, and it's a perfect 1031 exchange. For you at that point. So, yeah, it happens a lot.
[00:16:12] Speaker B: Okay. So this is a question that we get quite a lot. Can I homestead my property if it's in a land trust?
[00:16:24] Speaker A: You can homestead your property in a land trust. And in fact, the big number one, let's talk about what Homestead is for the people who don't live in Florida yet, because I think everybody's moving here. But the. The homestead is your primary residence now in Florida. If your homestead is under a half an acre inside city limits, or less than 160 acres outside city limits, it is protected 100% against creditors. So if you go bankrupt, that property is not an asset that the trustee can sell to satisfy and pay off your other creditors. If you are sued for $20 million and you have a six acre estate in Palm Beach county on the ocean worth $100 million, they cannot come and take that estate from you to satisfy their $20 million judgment.
There's a reason OJ Simpson did that whenever he was sued. So that's the big important part of homestead in Florida. And that's why so many people love, very wealthy people love to come here and buy very large homes. They pay cash, they buy them, and now they know that no matter what, they get sued for, wherever it may be, no one can come to Florida because the state law controls that and take that homestead away from them. So that's why Homestead is so important. Another reason that homestead is so important in Florida is because under the Constitution and under the statutes, you get special tax benefits for real property tax. For instance, if your property is increasing in value 1020 percent a year, it is capped in the state of Florida because it's your homestead. So that value, while it may have gone up 20% year over year, this county property appraiser can only increase your value by 3% at most. So they cap it so it's 3% or the rate of inflation, whichever is less. When the rate of inflation was lower than 3%, they could only go up, you know, the 1.51.4%. But once we start going over 3% inflation, they were capped at the 3%. You have a similar exemption for commercial property at 10%, but for homestead, it's capped at 3% plus. In addition to the capping at 3%, you also get to take $50 to $75,000, depending on the tax that's being assessed off of the valuation of the property. So if your house is worth $100,000, you may get to take $75,000 off. So now they're only taxing you at $25,000 instead of $100,000 value. That's another benefit of the homestead across the board.
Another. Another benefit for the homestead is that, gosh, I just lost it. But it is another. There are other tax benefits with the homestead that you get Florida. So that's why everybody loves their homestead. Oh, the porting. Whenever you move from one homestead to another, or whenever you sell that Homestead, you have up to three years to port your savings. So if you have 100 or $300,000 of savings from your current homestead, and then you move into another property, maybe you downsize. You can port that $300,000 that you value reduction from your home, your current homestead, to your new homestead, and you've got up to three years to do that. So let's say you move out of the homestead and it. And it just loses homestead protections. You turn into a rental. So now the taxes go up, the valuations go up, everything goes up on that property. But you had $300,000 worth of depressed value saved on it. Two years later, you go, okay, now I'm going to buy another house. You can now port that $200,000 savings that you had to the new property and move into it. Let's say you buy a condo out at the beach and it's a $300,000 condo. Now you take $200,000 off of it, off the valuation from the get go, you're only paying tax on $100,000 value. So this is why the homestead's so important and why people love to preserve it. So the big question we get is, what if I put my homestead into a land trust? Do I lose that protection? And that's a big question, because typically, whenever you change title to property, any exemptions that you had are potentially lost. There's a good chance you could lose all the exemptions and all the tax savings you had simply because you changed the title on the property. So going from your name and into a land trustee, as trustee of a land trust, is technically a change of title. However, under the land trust agreement, you reserve the right to reside on the property. And under state law, simply retaining that right to reside on the property as your primary residence is enough to retain your homestead. So what often happens, it happens a lot. We run into times where it goes from a person's name and into a land trust, and then the property appraiser says, okay, well, we're changing the valuation right now off the bat, and we have to go in and argue with them. And we have special language. We put in the deed that specifies that the beneficiary has retained the right to reside on the property as their primary residence, they've retained the right to the homestead, and that is used to prove to the property appraiser that there was not a change in status for homestead purposes. So therefore, it should not be revalued. The cap should not go away. The exemption should not go away. All these savings that you have stay on the property, and sometimes it takes some time to make that argument and get it through other appraisers, property appraisers, it just depends on the county. Some are very understanding. Others, you know, this is a lot of money for that county. So they fight over this. So it just depends on the county. But sometimes that argument's easy. Sometimes it's tough. But what we recommend instead to say that having to argue with the appraiser at a later point when you buy the property, take it straight into the trust off the bat so that your homestead is reestablished inside the homestead right then, and save that argument with the property appraiser later so we don't have to make that argument later by moving it, your homestead, into the land trust a year or two later. What's our next question?
[00:23:30] Speaker B: All right, so we know that land trusts provide anonymity to the beneficiaries.
Two questions. Why would one be so worried about remaining anonymous? And why can too much anonymity be a problem?
[00:23:51] Speaker A: Okay, I heard this this weekend.
A client of ours said that they visited with another asset protection lawyer, and that lawyer had said, well, why do you want to remain so anonymous? What are you doing that you need to remain so anonymous? What are you so worried about?
Her response was, well, why wouldn't I want to remain anonymous? And he said, well, judges look down on it. There's something going on if you want to remain anonymous. Well, I shot back, well, if anonymity and asset protection is such a horrible thing, then why do we have corporations? Why do we have llcs?
These entities? These concepts were all created for reasons to limit liability, to segregate liabilities. The reason corporations came into being was because ships leaving Europe, it was such a very risky venture that they didn't want to, and very wealthy people were sending these ships out into the ocean, and they didn't want to put everything else they had at risk, sending these ships out and then getting sued for something that the ship did and losing all of their fortune. So they create a company, a limited company that would then own the ship. So if something happened with the ship, only the ship went down, not everything else they had. So typically, that's why they existed. So my response to that was, well, just the same reason you would have an LLC or a corporation to segregate liabilities.
You can have a land trust to segregate those liabilities. But with the land trust, you get that anonymity, too. So then the question comes back to, well, why are you? So why do you want to remain anonymous? And I can tell stories all day of where that anonymity has helped our clients, especially with tenants.
We get the angry tenants walking into our office saying, hey, I've got black mold in my bathroom, in my child's bedroom, and I'm going to sue you. And you guys need to do something about the mold. They're screaming at us about that. They don't know who the beneficiary of the trust is. They don't know who really owns that property, so they're not going showing up at our client's house and screaming at them.
The anonymity goes so far.
Another reason, again. So that's the person who's inside the house can't find who owns it. The person who got injured at the house cannot find out who the beneficiary is to go and sue them directly. So you get that segregation of liability. That ship is not going to take you down. You're not going to drown on that ship with it as it goes down.
We've had children drown in pools. We've had children shot by accident by guests at parties, at houses that we've owned and trust, who have been injured for the rest of their lives. We've had children mauled by dogs at houses that we hold in trust by tenants dogs. And that ship goes down, but only that ship goes down. It doesn't take the true owner, the beneficiary, with it.
So that's number one. And they can't go after that beneficiary and look at them and go, oh, well, you also own all these other properties. You also own all this other stuff, because now they've just looked up your name to see everything else you own, because anonymity was not important to you, because you were afraid that a judge would think you look sketchy because you wanted to be so anonymous. So you had your name on everything. So this visitor to this tenant who slipped and fell on that slippery front step and broke their hip, and now they have an artificial hip for the rest of their lives, and they're going to walk with a little bit of a limp and be in pain. Every time it gets cold, they look at you and go, oh, well, these people own 27 homes, so sure, we'll take that $100,000 worth of liability insurance you have, but we're going to keep going because now we know everything else you have because you didn't want to remain anonymous because you thought that looked sketchy. So that's number one. Number two is let's talk about outside creditors. We talked about inside creditors, people inside the house getting hurt and suing you. Outside creditors. Let's say you're also in business and you sign a contract for something and it's a multimillion dollar contract and you've personally guaranteed it in some way, and now it goes bad and you just go, look, I can't keep doing this, and I'm going to breach the contract. It's cheaper just to breach it and stop doing the contract.
Yellow page ads. Back in the day, I had clients who signed yellow Pages ads. These things were 90,000, $100,000 a month yellow pages.
Who looks in yellow pages anymore? So they just stopped paying it. Well, they got sued for hundreds and hundreds and millions of dollars. Hundreds of thousands and millions of dollars for yellow page ads. Well, the yellow page ads just do a search to determine, hey, are these people even worth pursuing, or do we sue them and just walk away? Or do we just not even bother suing them in the first place? Well, they're going to search your name and they're going to go, well, look, on Sunbiz, they own, he's listed on all these companies as a manager or a member, so he must own a lot of stuff. So he's got something there. Or they searched and they searched the real property records. Look at all these companies that he owns. They own all these properties, commercial, industrial, residential. Yeah, let's go ahead and sue for this $2 million that they owe us because he's got deep pockets and we can get our money out of this person. We will get our money. They are a deep pocket. Now let's flip that and say that the person was like, no, I want to remain anonymous. Everything I own, I want to own in land trusts, all the real property, all my llcs, I don't want my name to appear on them. And we can make that work, too. So when they go to search and they go, hey, this guy owes us $2 million for yellow Pages ads. They're going to first search and go, is it worthwhile even pursuing this person? They're going to look up his name. He doesn't own any llcs. He's not listed on any corporations on Sunbiz. Let's run a records check of real property records across the state of Florida, because there is a spot where you can search all public real property records in the state of Florida. His name doesn't appear on any real property records in Florida. So, eh, let's not even bother suing him. Let's just let this one go, or let's go ahead and sue him, and we'll just get the judgment, and if anything ever pops up, we'll get it. And lo and behold, the judgment's good for ten years. He never owns anything just in his name. They never really dig. They don't come after it. They don't try to levy on anything, so they never get anything to satisfy that $2 million judgment that they got. And we've had that happen with clients. We've had clients get sued and have massive judgments against them, and they never collect anything because they never dug. They never went after them to really dig to see what they owned. They just let the judgment sit out there for ten years, and then it expired, and they walked away from it. So that's why anonymity is important.
And again, not why should I remain anonymous, but why not? Why wouldn't you, if you can do it? And it just. It just works out better for everybody? What was our second question on that one?
[00:31:47] Speaker B: Why can too much anonymity be a problem?
[00:31:52] Speaker A: With the caveat, too much anonymity can be a problem when it comes to owning real estate.
I was in title for 25, 27 years. I did title work, closings, real estate closings, settlements. If you're from Maryland or Virginia, they call them settlements. But in that profession, I learned that when someone comes to us and the property is owned by an LLC, we ask for a couple of things. We ask for the articles of organization that were filed, and we asked for an operating agreement. And so the articles of organization, regardless of where you file the company, Wyoming, Nevada, Delaware, Florida, wherever it happens to be, you can pull those online. You can get me a copy of those. So anybody, any Tom, Dick, or Harry can go pull a copy of articles of organization and hand those to the title agent and say, here. Here are the articles of organization.
And then the title agent goes, fine. I need your operating agreement. I need to see who the members are so I can make sure that everybody who has to approve this sale has approved it. Well, there's a couple ways you can handle that. Number one, you can say, well, there is no operating agreement. In that case, the title agent says, fine, sign this, saying, you sign this affidavit saying that there is no operating agreement. You are the member, you are the manager, and you have sole authority to do this. Okay, fine, I sign the affidavit that gets recorded. The title agent has done all that they can do and all they have to do to determine who really owns this LLC, and they will say, okay, fine, you have the right to sell or mortgage this property. And likewise with a bank, this LLC was just set up, so there's no tax returns, anything they can ask for. And they go and they open a bank account in the name of the same LLC, even though they don't own it, and they go through the closing, they sell the property, the money is wired, or they take out a big old mortgage on the property because it's on free and clear. The money's wired in to that company. A few months later, the property goes into foreclosure, or a few months later, you go to visit the property, and there's someone else living there, and you go, what happened? Well, the property was sold or it was mortgaged, and you had no knowledge because you were so anonymous that no one knew that you were actually the owner of the LLC that owned this property. So that's where too much anonymity can be a problem. So for that reason, we recommend not holding real estate in an entity where it's so anonymous that no one can verify who the proper signers are. So that's one of the reasons why we like using us as the trustee. Because when we're the trustee, we're out there. We're everywhere.
We're in almost every county in Florida. Most title agents know us. They know who we are, they know how to find us, and they contact us. So if a property is being sold and it's in a trust where we are the trustee, they get in touch with us, and they go, hey, we're handling this closing, and we may have not been contacted by anyone.
And our first thing is, okay, thank you. Let me get your information. We put it in the file, and then we contact you, the beneficiary, and go, hey, we're being contacted that you're selling this property. And a lot of times, or you're mortgaging this property, and sometimes it's happened where the beneficiary goes, no, I'm not. And so we have to contact the title company and go, someone's trying to slide by and mortgage or sell this property. Stop everything. We do not have permission to do anything that you're asking us to do. So this property will not be sold or it will not be mortgaged or it won't be leased. We've had tenants, potential tenants, contact us before and say, hey, I'm dealing with so and so. And they're telling me that they have right to lease this property to me. And I'm getting ready to hand them $5,000 for first month's, last month's rent and a security deposit. And before I hand them the money, I want to make sure I'm dealing with the right person. And they find us on the Internet. They contact us, they ask us the questions, we look it up, who they're talking to, and if that name doesn't match anybody in our system that's authorized to act with this trust, we then contact our beneficiary. And this happens at least probably five, six times a year. And the beneficiary says, no, the property is not for lease or it is for lease, but I'm dealing with another property management company that's leasing it for me or whatever.
And we've stopped a lot of times where people are trying to defraud potential tenants out of the property. So too much anonymity can be a problem in owning real estate. For that reason, if you want to remain anonymous and still own real estate, the land trust is really your best route to take. But use a third party trustee that is well known that people can, that title agents can find quickly and easily contact them, and a professional trustee third party trustee will have the knowledge and the ability to then cooperate with the title agents or the tenants or handle that in a way that protects the beneficiary.
This is another reason I don't like using mom or dad as your or sister as your trustee, because they're not easy to find and anyone can then just fake an id that they are, mom, dad, or your sister and show up and say, yes, I'm the trustee of this property and we're selling it and all the powers are there. So they're just going to let that person who showed up with that fake id sell that property. If it's a really good fake id and title agent doesn't catch it.
So using a third party trustee, that is an entity that is well known in the state, like us, everybody knows how to contact us. They do. They contact us, they ask us questions, we verify, we make sure everything's okay before we sign anything. And then it just protects you a lot more as the beneficiary while you still maintain that anonymity that you crave so much and that you should crave.
[00:38:18] Speaker B: A hot button topic right now is the new anti squatter legislation in Florida. What does the new legislation in tail.
[00:38:31] Speaker A: Okay, so yeah, Florida just recently signed into law the new anti Squatter act. And I didn't know squatting was such a, in real estate was such a big issue. I just didn't know that was a thing.
But apparently all over YouTube now, there are just tons and tons of videos of people showing up at their houses, their rentals, and finding squatters have moved in. So apparently it is a problem. So let me give a little history first, of what we have in Florida. First, you had trespassers. And trespassers are people who have absolutely no permission to be at the property at all. And there's criminal trespass. And that you see that a lot of times whenever you got people loitering at a store or they're in a store and the shopkeeper doesn't want them there anymore, or someone has just moved into a. A property with no paperwork, no nothing, and they're a trespasser. They're not allowed to be there at all. At that point, you call the sheriff or the police and you have them removed because they're a trespasser. And that's fairly easy. They go, do they have your permission to be here? No, they do not. They ask them, do you have any right to be here? And with a commercial establishment, that's really easy because they're there. Guests, they're not supposed to be there, fine, we trespass them, they're out, and they cannot return. And if they do return, it's a criminal event and they can be arrested. So that's trespassers. The others are. The next step of that is, let's say it's a property and they do have some paperwork. If they were a tenant and they had a lease and the lease is now expired or it's been terminated and they continue to stay over, they're a holdover tenant at that point. You're not evicting them. They are, they are under an unlawful detainer. And you use an unlawful detainer action to have them removed. Again, it's a court action. You got to go to court. You got to have a judge say, yes, they must be removed. And they tell the sheriff, sheriff, remove this person from that property. We know that they had a legal right to be there. At one point. They no longer have a legal right to be there, but we have to get them out of the property. You have to go into a court. You have to get the judge to sign an order telling the sheriff to go and remove these people from the property.
That takes time, that takes money and effort, and it's a pain in the neck, but it has to be done that way because they did have paperwork and it gave them a right to be there. And now you have to have them removed. The third way to get a person out, let's say they are a tenant. The lease is still out, but they've breached the lease.
So the lease has not expired, it's not been terminated, and it's still in existence. Now you go through an eviction. This is the third way, typically that you remove someone from a property. It's through eviction. Again, you have to go to court. The court. The judge then hears both sides, enters an order, tells the sheriff, hey, go remove this person from the property. And then there's procedure of how they are removed from the property. The gray area in all of this is you've basically got a trespasser now who shows up at a house, no right to be there at all. But when the sheriff shows up, the owner calls the sheriff and says, hey, they're a trespasser. Remove them. This person starts pulling out paperwork and says, no, here's my deed. It may be a fraudulent deed, it may be a fake deed, or here's my lease, and it's signed by someone who wasn't the owner of the property.
And or in the case of sovereign citizens, they go, no, here is my lien. I have a lien on the property and it gives me the right as a sovereign citizen to live in this property and any other property that I place a lien on under their arguments that they make as sovereign citizens to live in the property. At that point, the sheriff's hands are tied because they go, well, they're not a trespasser, or I'm not the judge and I'm not the jury. So I can't determine are they a trespasser or not. I just don't have that right to do that as a sheriff's deputy.
I have to then go, well, they've got paperwork, so unfortunately you're going to have to go in and make that case as an unlawful detainer and ask a judge to say, judge, they don't, this paperwork is all fraudulent. They're going to make their argument that it's not. Judge is going to hear both sides, and nine times out of ten, the judge is going to say, you're right, they have no right to be there. This, these documents are no good. Sheriff, remove them again. This is going to take weeks to months to do this, to get them out. Plus, you're spending a lot of money to do that. So to combat that trespasser with paperwork, the squatters, the legislature came up and this was a, this passed the legislature 100%. Both the House and the Senate in Florida voted 100% to pass this. So this is not a right or left Republican Democrat issue. This is a, this is just a property ownership issue that has become a problem. And it's bad enough that they felt the need to pass this statute, and the governor signed it pretty quickly. But under the statute it says, okay, fine, you've got paperwork and you're in possession of the real estate, the residential real estate. This isn't for commercial property because you still have trespass there. Criminal trespass. That works very well for commercial property. Even if they do have paperwork, nobody cares. But for a residential property, one to four family residents, they've moved in, they're presenting paperwork. You call the sheriff and say, sheriff, remove these squatters, these trespassers from my home. They throw up their paperwork and they say, no, I've got paperwork. Now under this new statute, once it goes into effect, you can go down to the sheriff's office and you have to fill out a form.
And that form says their paperwork isn't, they are not my tenant. They do not have my permission to be there orally or in writing. They have no right to be on the property. So in essence, they are a trespasser. We are not related to each other by blood or marriage. We have no existing lawsuit already pending between us.
All those factors are met and you sign this document and it's sworn, it's under oath. Penalties of perjury in the sheriff's office. Give that to the sheriff and that can be sworn out by the owner of the property or anyone who is authorized by the owner with personal knowledge to execute this document. So it doesn't have to be the owner for a trust. It could be the beneficiary. You know, the trustee says, well, the beneficiary has the right to do this. In most cases, typically, the beneficiary would tell us, they would give us all the facts and then we would sign that for them. Or a property manager can sign it on behalf of an owner. Anyway, that all gets signed, gets handed to the sheriff. Now the sheriff has complete immunity to go in without a court order telling them to do this. The sheriff can go and remove this squatter from the premises and say, nope, this guy has told us in writing, basically sworn out the statement that you have no right to be there and your paperwork is fraudulent, and we are going to remove you forcefully from the property if necessary. Typically what they do is you show up with a cleanout company and a locksmith, and the sheriff stands by, the sheriff serves it on them, says, get out of the property. And then the sheriff stands by and keeps the peace while your move out company removes all of their belongings out to the street. And then the locksmith changes all the locks, locks all the windows, locks the doors, disconnects the garage door openers, all those good things to secure the property so they can't get back in 24 hours later, everybody goes back, checks the property. If the stuff has not been removed from the street, they then carry that off to the dump. But, and that happens in an eviction, as well as a forcible remover under an unlawful detainer or the new anti squatting law that has now been passed. So that's where this law sort of comes in. It fills in that gray area gap that we've had where you have trespassers with paperwork. Now they can be removed from the property summarily without having to take weeks, months, and money to go through a court and get a judge's order to tell the sheriff to remove them from the property. So that's, that's why we've, we've now got that law here in Florida, and a lot of other states are watching it and probably going to see it pop up in a lot of other states besides Florida. As time goes on, you folks watching in other states or listening in other states, you now know about it. Maybe you want to start talking to your state legislators about passing a similar law in your state to make it easier to get squatters out of your house without having to go to court to get it done.
Perfect.
[00:47:47] Speaker B: Well, you answered the last question in that answer, and that wraps up our questions for today. Do you have anything else you want to add?
[00:47:54] Speaker A: Yeah, I just want to remind everybody, number one, if you like my podcast or our podcast, please give us a five star review and give us a review on whatever platform you watch us or listen to us. That really helps us. That's sort of what I consider paying the fee. We are not supported by ads. We don't sell ads. So I'm not gonna, you know, try to sell you dog food on here, even though I'm, I've got my picks, but. And then also keep the questions coming. Like I said, through any of our social media, you can ask us questions or text us 3868-3210 love to get your questions. Love to answer them here on, on the station here for you. But please, if you ever have any other questions, feel free to reach out. And if you need a consultation, you know how to get hold of us.
