A Coin With Many Sides

In Florida, homestead is not just good, it’s great. But it is complicated. So complicated that a whole book would be required to describe it. But please understand that it helps to have homestead.

The term “homestead” is used in the law in several ways. One of the ways is provided by the Florida Constitution, and it saves the head of a household from losing his or her home to creditors if he owns the home. Realtors are familiar with a different use of the word. Theirs has to do with homestead exemption from taxation. That exemption has specific qualifications, and an application must be filed to qualify for it. Remember, though, that’s a completely different “homestead.” Another version is known to estate planners. It says that the head of a household must not disinherit his (or her) spouse or minor child. Again, an entirely different homestead.

This article speaks only to homestead exemption from losing the family farm (homestead) to any creditor seeking to collect a debt.

There are exceptions, but generally, an estate or financial planner would tell all of us to ask no questions – just own your home. Don’t mortgage it, unless you must, and pay its mortgage off when you can. Your homestead, and even the proceeds from its sale, are secure from most creditors, again by the specific words of the Florida Constitution.

But there’s an ugly other side of this constitutional use of “homestead.” Homestead is so good it can be abused. I’ve just seen a case in which an angry Florida man broke into his girlfriend’s house with a gun. When she disappointed him, he shot her in the face with a shotgun. Fortunately for him, she lived. He will one day get out of jail. She will spend much of that time in a hospital.

This man owns nothing except a homestead worth many thousands of dollars. But even with injury lawyers on every billboard, no one wants her case, because no judgment will break his claim to homestead. A judgment cannot be satisfied because of a guarantee of homestead in the Florida Constitution.

Another example of the ugly, other side of Florida homestead is that all over the world, literally, big money people are told by their advisors to salt their money away in a Florida homestead. If they qualify for Florida homestead exemption, how they got the money to buy their twenty million dollar beachfront home in south Florida doesn’t matter. The house, and if they sell, the proceeds of the sale, are exempt from creditors.

Next month Florida will appoint its every-20-year Constitutional Revision Commission. The Commission should consider a proposal to amend the Constitution to create an exception to the absolute immunity from creditors given to homestead property. The exception they should propose to the voters is that criminal acts that result in damage to another person or in dishonest gain, committed by a person claiming homestead, can be considered when a court is asked to award homestead immunity to an owner.

Such an amendment would prevent a person from abusing this important homestead right and would require one who injures another to pay at least some portion of the cost of that injury.

This article was published in the Coastal Homes publication of the Northwest Florida Daily News on February 4, 2017

Mike Chesser

Board Certified Real Estate Attorney

Board Certified, Local Government Law

President, Old South Land Title, Inc.

President, Chesser & Barr, P.A.

1201 Eglin Parkway

Shalimar, FL 32579

# (850) 651-9944


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