Real estate terms and words can become confusing, but it is important to know what you are talking about when you enter into a real estate transaction. In Florida, you might be signing a mortgage or a promissory note. Make sure you know the difference before you sign, because it could have an impact on what you are getting and what you owe.
A promissory note is a contract in which one party or person agrees to pay another party or person a specific sum of money. In Florida real estate, it often describes a buyer agreeing to make a monthly mortgage payment to his or her lender. It does not have to reference the property at all. Instead, it is talking about the sum of money that is owed, how it will be paid, what the payment terms are and when the loan will be completely paid in full.
A mortgage has to do with property. It is the transfer of a property interest between one party and another. The people who own the property will sign the mortgage. They might also sign a promissory note. The mortgage has to attach to a property, however, and the mortgage must also be recorded in the county or town recording office since it references the property that has been purchased. A promissory note, however, is simply filed with the lender and does not need to involve any government or civic entity.
Stephen K. Hatchey, a Florida real estate attorney, can help clarify these terms and guide you through various legal processes. To receive a free consultation, contact our offices at 813-549-0096.
This article is for general informational purposes only and does not establish an attorney-client relationship. Please contact a licensed attorney in your state of residence. For more information on our services, please visit our website at www.floridarealestatelawyer.org