Question 1

How does undue influence apply in real estate transactions?

Accepted Answer

RE undue influence: a property transfer may be voided if the grantor was unduly influenced. Common scenarios: elderly property owner (a caregiver, family member, or "friend" pressures an elderly person to transfer property to them), reverse mortgage (an elderly homeowner is pressured by a family member to take out a reverse mortgage for the family member’s benefit), and power of attorney abuse (the agent under a POA transfers the principal’s property to themselves or to a third party for the agent’s benefit). The transfer: can be challenged by the grantor (if alive and regains capacity), the grantor’s heirs or beneficiaries, or a guardian or conservator appointed by the court.

Question 2

What are the signs of undue influence in a real estate transfer?

Accepted Answer

Red flags: the grantor was elderly, ill, or had diminished capacity at the time of the transfer, the transfer was initiated by the grantee (not the grantor), the grantor was isolated from family and friends, the transfer was made without independent legal advice, the transfer was for less than fair market value (or for no consideration), the grantor changed their estate plan shortly before the transfer (removing natural beneficiaries), and the grantee was in a position of trust (caregiver, attorney, family member, or financial advisor). Any combination: of these red flags should prompt further investigation.

Question 3

How can Florida property owners protect against undue influence?

Accepted Answer

Protection: independent counsel (the property owner should have their own attorney who is not connected to the potential influencer), capacity assessment (if there are concerns about the owner’s capacity: a physician’s assessment can document their competence at the time of the transfer), witness statements (have independent witnesses present at the execution of the deed who can testify about the owner’s state of mind), video recording (record the execution ceremony: the owner explains the purpose of the transfer in their own words), and estate planning (a comprehensive estate plan: with a trust, POA, and healthcare directive: reduces the opportunity for undue influence).

Undue Influence in Real Estate

Undue Influence in Real Estate

Common Scenarios

Red Flags

Protection

Related Terms

Barnes Walker Real Estate

Ready to Get Started?