LENDER REPRESENTATION – Puleo Delisle PLLC

We are excited to announce that the Puleo Delisle law firm has expanded its services to include private lender representation with new attorneys and personnel solely dedicated to this fast-paced and highly competitive space.

The two attorneys leading this division have over 20 plus years of combined experience representing private lenders and understand what needs to be done in order to get deals closed quickly and efficiently while maintaining an uncompromised commitment to protecting our clients from additional risk.

Please see our interactive map highlighting some of the state-specific nuances especially applicable in private-lending and let us know if your company needs any assistance with these types of transactions in any of the many jurisdictions covered by Puleo Delisle.

Click each state for more information

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Alabama

Transfer Deed: General warranty deeds are most common.
*Settlement Type: Title company or law firm can act as title and settlement agent and are chosen by the buyer/borrower; an attorney must prepare all legal documents unless parties to the transaction are preparing their own documents.
*Licensing Requirement: a license is NOT required for loans greater than $1,500.
Taxes:
- Transfer Tax: YES, negotiated between buyer and seller.
- Mortgage Tax: YES, paid by borrower.
Usury Rate: No usury cap for loans secured by real property.
Community Property State: NO
Witness Requirements: Deeds and mortgages must include one witness (the notary may also be the witness but must sign as both witness and notary).

Connecticut

Transfer Deed: Warranty Deeds are most common
Settlement Type: A law office typically acts as title and settlement agent and is often also representing the borrower/buyer; only attorneys may handle the closing and issue title
Licensing Requirement: a license is NOT needed for loans greater than $15,000 (if loan is under $15,000, the interest rate must be 12% or higher)
Taxes:
- Transfer Tax: YES – paid by seller
- Mortgage Tax: YES – paid by borrower
Usury Rate: there is no usury cap for loans secured by real property but 24% is customary for business-purpose loans
Community Property State: NO
Witness Requirements: Deeds, mortgages and Powers of Attorneys require two witnesses and must be notarized.

District of Columbia

Transfer Deed: Warranty deeds and special warranty deeds are most common.
*Settlement Type: Title companies typically act as title and settlement agent; an attorney must prepare the deeds unless parties to the transaction are preparing their own documents.
Security Instrument: Deed of Trust. There is no restriction for who can be the trustee.
Taxes:
- Transfer Tax: YES, negotiated between buyer and seller
- Mortgage Tax: NO (NOTE: Deed of Trust must contain a Security Affidavit affixed to it in order to be exempt)
Usury Rate: Basic ceiling is 24% but all commercial loans in excess of $2,500 are exempt.
Community Property State: NO

Florida

Transfer Deed: Warranty deeds are most common in residential and special warranty deeds are most common in commercial.
Settlement Type: Law firm or title company can be the title and settlement agent, which handles all aspects of transaction from issuing title to closing and is usually chosen by the buyer/borrower; an attorney must prepare all legal documents, unless the parties are preparing the documents themselves.
*Licensing Requirement: Florida requires a lender license on commercial property if borrower is an individual or the lender is a non-institutional investor; the law is unclear on whether a license is needed if borrower is an individual purchasing a single family dwelling as an investment property.
Taxes:
- Transfer Tax: YES, negotiated between buyer and seller.
- Mortgage Tax: YES, paid by borrower.
Usury Rate: Usury cap for loans less than $500,000 is 18%; for loans greater than $500,000, the cap is 24%.
Community Property State: NO
Witness Requirements: Deeds and Power of Attorneys require two witnesses, in addition to the notary (mortgages just need a notary).

Georgia

Transfer Deed: Warranty Deeds are most common in residential and Limited Warranty Deeds are most common in commercial.
Settlement Type: A law office typically acts as title and settlement agent and is often also representing the borrower/buyer; only attorneys may prepare legal documents, handle the closing and issue title.
*Licensing Requirement: If borrower is NOT a natural person that occupies or intends to occupy the premises, the lender does not need to be licensed.
Security Instrument: Deed to Secure Debt. The maturity date must be listed on the security deed.
Taxes:
- Transfer Tax: YES, paid by seller.
- Mortgage Tax: YES, paid by borrower (NOTE: not applicable to instruments that secure notes that mature in three (3) years or less).
Usury Rate: no usury cap for investment contracts.
Community Property State: NO
Witness Requirements: Transfer and Security Deeds must include two witnesses (one witness may be the notary)

Illinois

Transfer Deed: General warranty deeds are common for residential and special warranty deeds are common for commercial.
*Settlement Type: Title companies typically act as title and settlement agent and are chosen by the seller; an attorney must prepare transaction documents, so it’s common for buyers/sellers to be represented by an attorney at closing.
Taxes:
- Transfer Tax: YES, negotiated between buyer and seller
- Mortgage Tax: NO
Usury Rate: No usury cap for loans secured by real property, but 24% is customary.
Community Property State: NO

Massachusetts

Transfer Deed: Quitclaim Deeds used in all transactions other than the western part of the state.
Settlement Type: A law office typically acts as title and settlement agent and is often also representing the borrower/buyer; only attorneys may handle the closing and issue title.
Taxes:
- Transfer Tax: YES, paid by seller.
- Mortgage Tax: NO
Usury Rate: 20% is the usury cap unless the lender is registered with the Attorney General’s office.
Community Property State: NO

Maryland

Transfer Deed: Warranty deeds are most common in residential and special warranty deeds are most common in commercial.
*Settlement Type: Title companies typically act as title and settlement agent and are chosen by the buyer/borrower; an attorney must prepare all legal documents unless parties to the transaction are preparing their own documents.
Security Instrument: Deed of Trust. Trustee must be an individual (corporations cannot exercise the power of sale), but does not need to be a state resident.
Taxes:
- Transfer Tax: YES, negotiated between buyer and seller.
- Mortgage Tax: YES, paid by borrower.
Usury Rate: Usury rate is 24%.
Community Property State: NO
Witness Requirements: Power of attorneys must include two witnesses (transfer and security deeds only need a notary).

Mississippi

Transfer Deed: Warranty deeds and special warranty deeds are most common
*Settlement Type: Title companies typically act as title and settlement agent and are chosen by the buyer/borrower; an attorney must prepare all legal documents unless parties to the transaction are preparing their own documents.
Security Instrument: Deed of Trust. Trustee may be an individual or an entity, and there is no residency requirement. However, the maturity date must be listed on the security instrument, as security instruments expire after 12 months if none is stated.
Taxes:
- Transfer Tax: NO
- Mortgage Tax: NO
Usury Rate: Loans over $2,000 are exempt from usury requirements.
Community Property State: NO

North Carolina

Transfer Deed: General warranty deeds are used most common in transactions between individuals, and special warranty deeds are most common in transactions involving entities.
Settlement Type: A law firm typically acts as title and settlement agent and is often also representing the borrower/buyer; only attorneys may certify title, draft legal documents and must supervise closings.
*Licensing Requirement: Lenders who make loans in the amount of $15,000 or greater do not need to be licensed.
Security Instrument: Deed of Trust. Any person or entity can be the trustee, although it is customary for the settlement agent law firm to be the trustee.
Taxes:
- Transfer Tax: YES, paid by seller.
- Mortgage Tax: NO
Usury Rate: Loans greater than $25,000 do not have a usury cap.
Community Property State: NO
Spouse Joinder: A non-titled spouse must join in any conveyance or voluntary encumbrance after the initial purchase money DOT (includes investment properties); non-titled spouse must join on all construction loan DOTs and open-end DOTs, even if they encumber purchase money financing.
Prepayment Penalty: No prepayment penalties are allowed for loans of $150,000 or less.

New Jersey

Transfer Deed: Bargain and sale deeds with covenants against grantor’s acts are most common.
*Settlement Type: Title companies typically act as title and settlement agent and are chosen by the buyer/borrower; an attorney must prepare legal documents and commercial contracts (a realtor may prepare a contract for a residential 1-4 family building). However, it is common that buyers/sellers are represented by attorneys, even in the residential sector.
*Licensing Requirement: New Jersey requires mortgage loan servicers to be licensed as of July 2019.
Taxes:
- Transfer Tax: YES, typically paid for by seller.
- Mortgage Tax: NO
Usury Rate: For individual borrowers the civil usury rate is 16% and the criminal usury rate is 30%. However, there is no civil usuary rate for corporations, limited liability companies and limited partnerships, and the criminal usury rate is 50%. Therefore, private lenders would only be subject to the 50% criminal usury cap when lending to corporate entities.
Community Property State: NO

New York

Transfer Deed: Bargain and sale deeds with covenants against grantor’s acts are most common.
Settlement Type: The lender’s attorney typically acts as settlement agent, and a separate title company issues title; typically, each party to a real estate transaction has attorney representation.
Licensing Requirement: Lenders making loans to businesses of $50,000 or less (where interest rate is higher than 16%) must be licensed.
Taxes:
- Transfer Tax: YES, paid by seller* (NOTE: Mansion tax is paid by the buyer)
- Mortgage Tax: YES, paid by borrower.
- Various counties and/or municipalities charge additional transfer taxes.
Usury Rate: 24% is customary for business-purpose loans, but most lenders include a usury savings clause as well.
Community Property State: NO

Pennsylvania

Transfer Deed: Special warranty deeds are most common.
*Settlement Type: Title companies typically act as title and settlement agent and are chosen by the buyer/borrower; an attorney must prepare legal documents. Therefore, it is common that buyers/sellers are represented by attorneys.
*Licensing Requirement: Business-purpose loans are not subject to lender licensing requirements.
Taxes:
- Transfer Tax: YES, negotiated between buyer and seller.
- Mortgage Tax: NO
Usury Rate: Business-purpose loans in excess of $10,000 are exempt from usury defenses.
Community Property State: However, if there is an impending divorce, non-titled spouses must join in the execution of a deed or mortgage.

Rhode Island

Transfer Deed: Warranty Deeds are common in residential, and quitclaim or bargain and sale deeds are common for commercial transactions.
Settlement Type: A law firm typically acts as title and settlement agent and is often also representing the borrower. However, a title company may also issue title and act as settlement agent and attorney supervision is not required for residential real estate closings. An attorney must prepare deeds, but most other duties for a real estate closing transaction may be performed by a non-attorney.
*Licensing Requirement: Licenses are not required for loans made to business entities, or business-purpose loans made to individuals in an amount greater than $25,000.
Taxes:
- Transfer Tax: YES, paid by seller.
- Mortgage Tax: NO
Usury Rate: Lender may choose maximum rate of (i) 21% or (ii) 9% over the prime rate shown in the Money Rates section of the Wall Street Journal; however, a loan given to a commercial entity over $500,000 is not subject to usury laws as long as its not a residence of any individual with ownership interest of [or in ] the borrower.
Community Property State: NO

South Carolina

Transfer Deed: Warranty Deeds (general warranty are most common for residential and limited warranty are most common for commercial).
Settlement Type: A law office typically acts as title and settlement agent; attorneys must be involved and handle the closing or lender’s may be denied equitable relief in a foreclosure action.
Taxes:
- Transfer Tax: YES, paid for by seller.
- Mortgage Tax: NO
Usury Rate: No usury cap for commercial real estate transactions.
Community Property State: NO
Witness Requirements: Deeds, mortgages and Powers of Attorneys require two witnesses and must be notarized.

Tennessee

Transfer Deed: General warranty deeds are most common for residential and commercial transactions.
*Settlement Type: Title companies typically act as title and settlement agent; an attorney must only prepare documents not related to closing (easements, etc.)
Security Instrument: Deed of Trust. A trustee must be a resident of Tennessee, or if a trustee is a corporation, it must be domiciled in Tennessee. The title agent or underwriter can be trustee, but this is not customary.
Taxes:
- Transfer Tax: YES, typically paid for by buyer.
- Mortgage Tax: YES, paid for by the borrower.
Usury Rate: 4% over the weekly average prime loan rate as published by Federal Reserve. However, if the choice of law paragraph in promissory note dictates a different states laws are governing law, then that state’s usury law will apply, not Tennessee’s.
Community Property State: NO

Texas

Transfer Deed: General warranty deeds are most common for residential and special warranty deeds are most common for commercial transactions.
*Settlement Type: Title companies typically act as title and settlement agent; an attorney must prepare all transfer and security deeds for closing.
Security Instrument: Deed of Trust. The trustee is typically the law office that prepared the security deed of trust.
Taxes:
- Transfer Tax: NO
- Mortgage Tax: NO
Usury Rate: 18-24% is most common for business-purpose loans; a usury-savings clause in the loan documents will typically allow a lender to escape liability, within reason, if default interest rate is determined to be usurious.
Community Property State: YES

Virginia

Transfer Deed Type: General Warranty Deeds are most common.
*Settlement Type: Title companies typically act as title and settlement agent and are chosen by the buyer/borrower; however, an attorney must prepare the transfer deed.
Security Instrument: Deed of Trust. A trustee named on the Deed of Trust must be a resident of Virginia, if a trustee is a corporation, they must have their principal place of business within the state of Virginia.
Taxes:
- Transfer Tax: YES
  - Buyer pays the state transfer tax.
  - Seller pays the state grantor’s tax.
  - Various counties charge additional transfer taxes.
- Mortgage Tax: YES
Usury Rate: there is no usury rate cap for business loans over $5,000.00.
Community Property State: NO. However, prior to 1991, VA recognized dower and courtesy interest. Therefore, if the last deed of record was dated or recorded before 1991, then you may need a spouse to sign off.