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Sales transaction should go through escrow agent

November 10, 2017
By ERIC FEICHTHALER - Real Estate Law , Cape Coral Daily Breeze

Dear Mr. Feichthaler:

I am seeking to buy a vacant lot next to my home, and I have reached the owner by e-mail. We have agreed on terms, including price and date of closing. He has asked me to send him the money, and he will send a quitclaim deed. The quitclaim deed will give my wife and I title, which we intend to homestead along with our current home. Is this a good plan?

-Roger P.

Dear Roger:

Our firm has seen a significant increase in activity on vacant lots in Cape Coral, and the prices have been moving upward as well. I hope your seller agreed on a fair price. However, I have several concerns about the process. First, a third party, like a law firm, should act as escrow agent for this transaction. The role of the escrow agent is to hold all items for a real estate transaction, including the funds, deeds and other documents, until all are received from both parties. If you send the money to the seller directly, and they refuse to sign the deed, you will be in store for some courtroom time that can easily be avoided. Never send money directly to a seller, it should always be in escrow.

The next issue is the deed. When a person gives you a quitclaim deed, all they are doing is giving you whatever interest they have in the property. If they have no ownership interest at all, they may be giving you nothing at all. It is vital you work with a firm that will conduct a title search to make sure the seller actually owns the property, and that there are no liens. A quitclaim deed from an owner of a property with $20,000 in tax liens may not be a good deal for you. The final part of your plan, homesteading the lot, likely will work on a standard Cape Coral lot, as the law provides up to one-half acre as protected homestead property. By strapping the property together with your home, both properties may receive the benefits of homestead, including asset protection and save our homes cap.

Eric P. Feichthaler has lived in Cape Coral for 28 years and graduated from Mariner High School in Cape Coral. After completing law school at Georgetown University in Washington, D.C., he returned to Southwest Florida to practice law and raise a family. He served as mayor of Cape Coral from 2005-2008, and continued his service to the community through his chairmanship of the Harney Point Kiwanis Club KidsFest from 2011-2015, which provides a free day of fun and learning to thousands of Cape Coral families, and funds numerous scholarships. He has been married to his wife, Mary, for 14 years, and they have four children together. Recently, he earned his board certification in Real Estate Law from the Florida Bar. He is also a Supreme Court Certified Circuit Civil Mediator.

This article is general in nature and not intended as legal advice to anyone. Individuals should seek legal counsel before acting on any matter of legal rights and obligations.

 
 
 

 

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