Second Mortgage in Orlando

Not on a rental held in an LLC, and usually not on one nobody in your family lives in. Article X, section 4(a) of the Florida Constitution ties homestead to property owned by a natural person, and inside a municipality limits it to the residence of the owner or the owner's family. An LLC is not a natural person, so an investment property it holds is not homestead. Florida also lets an owner mortgage even a true homestead voluntarily under section 4(c); the protection is against forced sale for unsecured judgments, not against a mortgage the owner signs. Our program lends only on non-owner-occupied investment property, never a primary residence or second home. Nothing we found settles how the rules apply to a 2 to 4 unit building where you live in one unit. This is not legal advice; your attorney or title company has the final say on your property.

It goes through court, and a second lender named in the case has to claim any surplus itself. Florida forecloses only through the courts under Chapter 702, with no power of sale, and the clerk runs the sale under section 45.031. Orange County's foreclosure sales run on an online auction site, myorangeclerk.realforeclose.com; for a parcel in Osceola or another county, check the sale method with that county's Clerk. A subordinate lienholder can redeem only up to the later of the certificate of sale or the time set in the judgment, and there is no redemption after that. If the sale brings more than the judgment, section 45.032 pays subordinate lienholders who file a timely claim before the former owner, so a second lender is not paid automatically. Under Florida case law, a junior lienholder properly joined in the senior foreclosure is foreclosed out by the sale, so a default on the first can cut off the second. If you refinance the first later, the second-lien holder generally has to sign a resubordination agreement. Read lien position explained before you stack debt.

Florida's two mortgage taxes, about 0.55% of the loan combined, plus the county's page fees. A recorded mortgage, first or second, pays documentary stamp tax of 35 cents per $100 under section 201.08(1)(b), with no cap for a recorded mortgage, and nonrecurring intangible tax of 2 mills (0.2%) under section 199.133. On a $150,000 second that is $150,000 x 0.55% = $825, an illustration, not a quote. In Orange County, mortgages record with the Comptroller, not the Clerk of Courts. Osceola's Clerk and Comptroller accepts eRecording through outside vendors, including Simplifile, CSC, Indecomm, eRecording Partners Network and Hopdox, and says vendor fees are set by the vendors. For a line of credit, the tax timing differs: documentary stamps follow each advance, while a revolving line pays intangible tax once on its maximum amount (sections 201.08(1)(b) and 199.143(3)). None of these are USA Mortgage fees; they are the state's and the county's. Compare structures in second mortgage vs HELOC on investment property.

The program accepts short-term rentals, but inside Orlando city limits a whole-home short-term rental is not permitted. The city's fact sheet says an individual homeowner may not rent the entire home for 1 to 29 days; what the city allows is owner-occupied home sharing of up to half the bedrooms, with registration. Florida's section 509.032(7)(b) bars new local bans on vacation rentals, but local rules adopted on or before June 1, 2011 survive, so the rules change at each city and county line. Check the parcel's jurisdiction and zoning before you count short-term income. Short-term rentals are eligible for our program, subject to underwriting.

The tax bill after the cap resets, any CDD assessment on it, and the bed tax if it is a short-term rental. Florida's 10% cap on non-homestead assessment increases does not apply to school district levies, and it resets on a sale or on a transfer of more than 50% of the owning entity, so the seller's bill understates yours. In master-planned communities, a Community Development District can levy assessments under chapter 190 that are collected on the county tax bill. In Osceola County, the 6% tourist development tax is not collected by Airbnb or VRBO; the host registers and remits it. A second lien adds a payment on top of all of these. Talk to your CPA about your own numbers.

Florida draws the line at purpose, by its own definitions. Chapter 494 defines a covered residential mortgage loan as one primarily for personal, family, or household use, and a business purpose loan as one whose proceeds the borrower intends to use primarily for a business purpose, judged by the CFPB's official interpretation of 12 C.F.R. 1026.3(a). That interpretation deems credit to acquire, improve or maintain a non-owner-occupied rental to be business purpose, but not if the owner expects to occupy the property for more than 14 days in the coming year, which matters for a vacation home you also use. The statute also makes it a violation to present a residential loan as a business purpose loan. Our program is for business-purpose use of the funds only. This is not a licensing opinion; talk to your attorney about your own structure.