Legal Question in Real Estate Law in Florida

Re: Loan Percentage

I hope you don't consider this person a friend. What are the terms of the loan? Is it to paid in one lump sum or over a period of years? In theory, if the loan is amortized over a certain number of years at a high interest rate you could be looking at a high payoff, just like with your house.

I would not advise anyone to enter into an agreement as you have described. You may have other options. Are these property taxes on your residence? what is the property truly worth? are there any loans on the property? what is your debt situation, you may need to consider bankruptcy in order to avoid losing the property and pay off the back taxes. Are you able to pay the taxes going forward?

Re: Loan Percentage

It's 150% only if it has to be paid back immediately. The rate may be less than 150% if it's compounded over a number of years.

For instance, if the loan is payable over eight years or more, your interest rate is less than 18%, which is below Florida's usury rate.

Just to let you know, contracts with an interest rate of more than 12% are not enforceable in Florida courts. Rates of 18% or higher are a felony ("usury," which means loansharking).

Either way, it sounds like a pretty bad deal, but it may be better than losing the house.

Incidentally, I know what you're thinking: 12%? My credit card is way over that! I've even seen car and home loans over that. How can that be if it violates Florida law? Yeah, banks, finance companies, and credit card companies have special exemptions under federal law that allow them to loanshark legally. Helps to have a good lobby in Washington when you want a license to steal.