Florida Statute 697.05 | Lawyer Caselaw & Research

The 2024 Florida Statutes

Title XL
REAL AND PERSONAL PROPERTY

Chapter 697
INSTRUMENTS DEEMED MORTGAGES AND THE NATURE OF A MORTGAGE

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F.S. 697.05

697.05 Balloon mortgages; scope of law; definition; requirements as to contents; penalties for violations; exemptions.—

(1) Any conveyance, obligation conditioned or defeasible, bill of sale, or other instrument of writing conveying or selling real property for the purpose or with the intention of securing the payment of money, whether such instrument is from the debtor to the creditor or from the debtor to some third person in trust for the creditor, shall be deemed and held to be a mortgage and shall be subject to the provisions of this section.

(2)(a)1. Every mortgage in which the final payment or the principal balance due and payable upon maturity is greater than twice the amount of the regular monthly or periodic payment of the mortgage shall be deemed a balloon mortgage; and, except as provided in subparagraph 2., there shall be printed or clearly stamped on such mortgage a legend in substantially the following form:

THIS IS A BALLOON MORTGAGE AND THE FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL BALANCE DUE UPON MATURITY IS $ , TOGETHER WITH ACCRUED INTEREST, IF ANY, AND ALL ADVANCEMENTS MADE BY THE MORTGAGEE UNDER THE TERMS OF THIS MORTGAGE.

2. In the case of any balloon mortgage securing the payment of an obligation the rate of interest on which is variable or is to be adjusted or renegotiated periodically, where the principal balance due on maturity cannot be calculated with any certainty:

a. The principal balance due upon maturity shall be calculated on the assumption that the initial rate of interest will apply for the entire term of the mortgage;

b. The legend shall disclose that the stated principal balance due upon maturity is an approximate amount based on such assumption; and

c. A legend in substantially the following form suffices to comply with the requirements of this section:

THIS IS A BALLOON MORTGAGE SECURING A VARIABLE (adjustable; renegotiable) RATE OBLIGATION. ASSUMING THAT THE INITIAL RATE OF INTEREST WERE TO APPLY FOR THE ENTIRE TERM OF THE MORTGAGE, THE FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL BALANCE DUE UPON MATURITY WOULD BE APPROXIMATELY $ , TOGETHER WITH ACCRUED INTEREST, IF ANY, AND ALL ADVANCEMENTS MADE BY THE MORTGAGEE UNDER THE TERMS OF THIS MORTGAGE. THE ACTUAL BALANCE DUE UPON MATURITY MAY VARY DEPENDING ON CHANGES IN THE RATE OF INTEREST.

(b) This legend, including the principal balance due upon maturity, shall appear at the top of the first page or face sheet of the mortgage and also shall appear immediately above the place for signature of the mortgagor. The legend shall be conspicuously printed or stamped.

(3) Failure of a mortgagee or creditor or a third party in trust for a mortgagee or creditor to comply with the provisions of this section shall automatically extend the maturity date of such mortgage in the following manner: The mortgagor shall continue to make monthly or periodic payments until the principal and interest which has accrued prior to the time of the balloon payment of the mortgage is paid in full, and the maturity date shall be automatically extended to the date upon which said payments would cause the mortgage debt to be paid in full assuming such payments are made when due upon such monthly or periodic schedule. The mortgagor shall be entitled to prepay the mortgage without penalty during the extension period.

(4) This section does not apply to the following:

(a) Any mortgage in effect prior to January 1, 1960;

(b) Any first mortgage, excluding a mortgage in favor of a home improvement contractor defined in s. 520.61(13) the execution of which is required solely by the terms of a home improvement contract which is governed by the provisions of ss. 520.60-520.98;

(c) Any mortgage created for a term of 5 years or more, excluding a mortgage in favor of a home improvement contractor defined in s. 520.61(13) the execution of which is required solely by the terms of a home improvement contract which is governed by the provisions of ss. 520.60-520.98;

(d) Any mortgage, the periodic payments on which are to consist of interest payments only, with the entire original principal sum to be payable upon maturity;

(e) Any mortgage securing an extension of credit in excess of $500,000;

(f) Any mortgage granted in a transaction covered by the federal Truth in Lending Act, 15 U.S.C. ss. 1601 et seq., in which each mortgagor thereunder is furnished a Truth in Lending Disclosure Statement that satisfies the requirements of the federal Truth in Lending Act; or

(g) Any mortgage granted by a purchaser to a seller pursuant to a written agreement to buy and sell real property which provides that the final payment of said mortgage debt will exceed the periodic payments thereon.

History.—ss. 1, 2, 3, 4, 5, ch. 59-356; s. 1, ch. 61-472; ss. 12, 13, ch. 83-267; ss. 11, 12, ch. 83-311; s. 1, ch. 86-39; s. 69, ch. 99-3; s. 22, ch. 99-164; s. 1879, ch. 2003-261.

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Amendments to 697.05

Arrestable Offenses / Crimes under Fla. Stat. 697.05

Level: Degree
Misdemeanor/Felony: First/Second/Third

Current data shows no reason an arrest or criminal charge should have occurred directly under Florida Statute 697.05.

Annotations, Discussions, Cases:

Cases Citing Statute 697.05

Total Results: 20

Zander v. Cima

Court: District Court of Appeal of Florida | Date Filed: 2015-11-13

Citation: 197 So. 3d 1082, 2015 Fla. App. LEXIS 17037, 2015 WL 7074657

Snippet: *1084 meet the requirements of section 697.05, Florida Statutes (2009), as á balloon mortgage

Amendments to the Florida Probate Rules

Court: Supreme Court of Florida | Date Filed: 2003-06-19

Citation: 848 So. 2d 1069, 28 Fla. L. Weekly Supp. 495, 2003 Fla. LEXIS 1063, 2003 WL 21402500

Snippet: 540, 5.541, 5.555, 5.635, 5.636, 5.690, 5.696, 5.697, 5.705, and 5.900; and deletion of rule 5.495. In

Mejia v. Conamaris Investment Corp.

Court: District Court of Appeal of Florida | Date Filed: 1996-03-20

Citation: 671 So. 2d 204, 1996 Fla. App. LEXIS 2832

Snippet: PER CURIAM. Affirmed. § 697.05(2)(b), Fla.Stat. (1993).

In re Amendments to the Florida Probate Rules

Court: Supreme Court of Florida | Date Filed: 1992-09-24

Citation: 607 So. 2d 1306, 17 Fla. L. Weekly Supp. 636, 1992 Fla. LEXIS 1622, 1992 WL 249483

Snippet: 540, 5.541, 5.555, 5.635, 5.636, 5.690, 5.696, 5.697, 5.705, and 5.900; and deletion of rule 5.495. In

Stevens v. Allegro Leasing, Inc.

Court: District Court of Appeal of Florida | Date Filed: 1990-05-23

Citation: 562 So. 2d 380, 1990 Fla. App. LEXIS 3528, 1990 WL 67314

Snippet: and mortgage involved did not comply with section 697.05, Florida Statutes (1982), pertaining to balloon

Lage v. Pan American Bank

Court: District Court of Appeal of Florida | Date Filed: 1988-08-16

Citation: 529 So. 2d 1242, 13 Fla. L. Weekly 1948, 1988 Fla. App. LEXIS 3695, 1988 WL 84050

Snippet: the provisions of the balloon mortgage statute, § 697.05, Fla.Stat. (1987),1 govern the mortgage un*1244der

Riano v. Burchfield

Court: District Court of Appeal of Florida | Date Filed: 1987-09-22

Citation: 512 So. 2d 1121, 12 Fla. L. Weekly 2298, 1987 Fla. App. LEXIS 10345

Snippet: DCA 1985), that the 1986 amendment to section 697.-05(3), Florida Statutes (1985), which eliminated the

Caden v. Safeco Title Insurance Co.

Court: District Court of Appeal of Florida | Date Filed: 1985-09-11

Citation: 475 So. 2d 275, 10 Fla. L. Weekly 2135, 1985 Fla. App. LEXIS 15799

Snippet: mortgage the statutory legend mandated by section 697.05, Florida Statutes (1979). In 1982 the Cadens filed

Fogg v. Southeast Bank, NA

Court: District Court of Appeal of Florida | Date Filed: 1985-07-17

Citation: 473 So. 2d 1352, 10 Fla. L. Weekly 1746

Snippet: In 1983 the balloon mortgage statute, section 697.05(2)(a), Florida Statutes, was amended to exempt

Snaith v. Haraldson

Court: District Court of Appeal of Florida | Date Filed: 1985-03-27

Citation: 466 So. 2d 1148, 10 Fla. L. Weekly 806, 1985 Fla. App. LEXIS 13132

Snippet: the mortgagees. The legend required by section 697.05(2)(a), Florida Statutes (1981), appears on the

Spielvogel v. Crown Realty Associates

Court: District Court of Appeal of Florida | Date Filed: 1984-06-27

Citation: 465 So. 2d 532, 10 Fla. L. Weekly 907, 1984 Fla. App. LEXIS 13749

Snippet: mortgage, subject to the provisions of section 697.05, Florida Statutes (1983), had to be taken to be

O'Neil v. Lorain National Bank

Court: District Court of Appeal of Florida | Date Filed: 1979-03-27

Citation: 369 So. 2d 378, 1979 Fla. App. LEXIS 14401

Snippet: which violated the balloon mortgage statute. § 697.05 Fla.Stat. (1977). O’Neil argues that he is also

Overlook v. Marshall

Court: District Court of Appeal of Florida | Date Filed: 1978-08-30

Citation: 363 So. 2d 131, 1978 Fla. App. LEXIS 16229

Snippet: provisions of the balloon mortgage statute, Section 697.05, Florida Statutes (1975). This statute mandates

Davies v. Cox

Court: District Court of Appeal of Florida | Date Filed: 1977-08-09

Citation: 349 So. 2d 218, 1977 Fla. App. LEXIS 16092

Snippet: involving the construction and effect of Section 697.05, Florida Statutes, dealing with balloon mortgages

Fletcher v. Liberty National Bank & Trust Co. of Louisville

Court: District Court of Appeal of Florida | Date Filed: 1977-07-27

Citation: 349 So. 2d 652, 1977 Fla. App. LEXIS 16534

Snippet: the “Florida Balloon Mortgage Statute”, Section 697.05, Florida Statutes (1975). The affirmative defenses

Overstreet v. Bishop

Court: District Court of Appeal of Florida | Date Filed: 1977-03-24

Citation: 343 So. 2d 958

Snippet: mortgage and subject to the proscriptions of Section 697.05, Florida Statutes (1975).[1] He then reported such

Slomovic v. Petryk

Court: District Court of Appeal of Florida | Date Filed: 1976-12-17

Citation: 341 So. 2d 208, 21 U.C.C. Rep. Serv. (West) 669, 1976 Fla. App. LEXIS 15828

Snippet: claiming that under the provisions of Section 697.05, F.S. (1975), she had the right to pay this balance

Perry v. Key West State Bank

Court: District Court of Appeal of Florida | Date Filed: 1976-11-02

Citation: 339 So. 2d 248, 1976 Fla. App. LEXIS 15922

Snippet: should therefore be extended. Florida Statutes § 697.05(2)(a) requires that “[ejvery mortgage in which

Vlock v. Capodilupo

Court: District Court of Appeal of Florida | Date Filed: 1976-01-27

Citation: 327 So. 2d 787, 1976 Fla. App. LEXIS 14693

Snippet: evidence and to apply the Balloon Mortgage Statute [§ 697.05, Fla.Stat., F.S.A.]. The motion was denied. After

City of Miami v. IC Sales, Inc.

Court: District Court of Appeal of Florida | Date Filed: 1973-04-17

Citation: 276 So. 2d 214

Snippet: latter); Jackson v. O'Connell, 114 Fla. 705, 154 So. 697 ($5 license fee for machines dispensing chewing gum