Can You Get a Mortgage on a Florida Land Trust?

Can You Get a Mortgage on Property in a Florida Land Trust?

You can get a mortgage on property held in a Florida land trust, including a conventional loan that a lender sells to Freddie Mac. Freddie Mac’s Seller/Servicer Guide has a section written for land trust mortgages, in its current form since July 2, 2025, and a lender that follows it can make the loan on a 1 to 4 unit home you live in, on a second home you occupy for part of the year, or on a 1 to 4 unit rental. Fannie Mae’s Selling Guide treats land trusts differently. Fannie Mae accepts them only on a negotiated basis, in states where land trusts are widely accepted and where the beneficiary is an individual, and the negotiated terms are not published.

A Florida land trust is a trust in which a trustee holds legal and equitable title to real estate under Florida’s land trust statute, while you as beneficiary direct the trustee and keep the rent and the sale proceeds. The deed on the county record names the trustee and the trust, and the trust agreement that names you stays unrecorded. Freddie Mac’s definition of a land trust tracks that structure and adds one requirement that matters in Florida. The beneficiary’s interest must be personal property. Florida’s statute makes the interest personal property only when the trust agreement or the recorded deed says so, and treats it as real property when both are silent, so a Florida agreement written for financing says it in so many words.

The lender makes the final call on every loan. Freddie Mac’s rule sets the minimum for loans it will buy, and a lender’s own requirements (called overlays in the industry) can be stricter. Nothing on this page predicts that a particular lender will approve a particular loan, and no mortgage rate is quoted here.

Practice pointer. Land trust agreements drafted from old forms often leave out the personal-property declaration, and without it the trust does not meet Freddie Mac’s definition. I read the agreement for that sentence before a client applies, because adding it after the lender has the file delays the closing.

Which Lenders Will Make a Land Trust Loan?

Three kinds of lender can finance property in a land trust, and each one applies a different set of rules.

1. A lender that sells land trust loans to Freddie Mac. A Freddie Mac loan is the conventional route, with Freddie Mac’s written conditions plus whatever overlays the lender adds. Not every lender offers it, so the first question I put to a loan officer is whether the company closes Freddie Mac land trust loans in Florida.
2. A lender with negotiated Fannie Mae terms. Fannie Mae permits land trusts only by agreement with a particular lender. Unless the lender confirms it has those terms, a Fannie Mae loan to a land trust is not available.
3. A portfolio or business-purpose lender. A bank that keeps the loan on its own books, or a lender making business-purpose loans on rentals (often called DSCR loans, underwritten on the rent the property earns), sets its own rules and is bound by neither agency’s guide. Portfolio and business-purpose lenders are the usual route when the beneficiary is an LLC.

The comparison with a revocable living trust, where both agencies publish rules, is laid out on our page about Fannie Mae and Freddie Mac rules for a trust mortgage, and the broader question of borrowing through any kind of trust is on can you borrow against a trust.

Who Signs the Note, the Mortgage and the Collateral Assignment?

A Freddie Mac land trust loan uses three documents, and Freddie Mac assigns each one a different signer.

1. The note. Each beneficiary who is a borrower signs the promissory note in his or her individual capacity. You are personally liable for the debt, the same as on any conventional loan, and your income and credit qualify the loan.
2. The mortgage. The trustee signs the mortgage, which Freddie Mac calls the security instrument, because the trustee holds title. The beneficiary directs the trustee in writing to sign it. Freddie Mac’s general signature rule also requires the signature of anyone whose signature state law needs to create a valid lien or to waive rights in the property, which in Florida reaches the spouse of a married owner living in the home.
3. The collateral assignment of beneficial interest. Each beneficiary who is a borrower pledges the beneficial interest to the lender as security. The beneficiary signs it, the lender accepts it, and the trustee acknowledges it. In the assignment the beneficiary certifies that no earlier pledge exists and agrees not to transfer any part of the interest without the lender’s written approval.

The collateral assignment exists because the lender holds two kinds of security. The mortgage reaches the real estate through the trustee’s title, and the assignment reaches what the beneficiary owns, which is the beneficial interest. Freddie Mac’s sample assignment is Form 50, written for Illinois, and for property in any other state the lender uses a form that reflects that state’s law unless it decides Form 50 is appropriate there. Freddie Mac requires the lender to warrant that the assignment is valid and enforceable under the law of the state where the property sits.

Practice pointer. A standard closing package names the borrower as mortgagor, which describes a different transaction from a land trust loan. I ask the lender for the draft mortgage and the draft collateral assignment a week before closing and check who signs each one.

What Does the Lender Need From the Trustee?

Freddie Mac lists three items the loan file must contain for a land trust mortgage.

1. The trust agreement. A copy of the original land trust agreement, or an abstract of it where the state requires one. The lender sees who the beneficiaries are, and the agreement stays off the public record.
2. The direction to the trustee. A document showing that the beneficiaries who hold the power of direction authorized and directed the trustee to sign the mortgage documents. In practice this is a written direction letter signed by the beneficiary.
3. The collateral assignment. For property outside Illinois, Freddie Mac requires the fully executed collateral assignment, signed by the beneficiary and acknowledged by the trustee.

The mortgage also has to be a valid first lien covered by a title insurance policy that meets Freddie Mac’s title requirements, and the financed property has to be the only asset in the trust. A Florida land trust that holds two rental houses does not qualify for a loan on either one until one of the houses moves to its own trust. Florida’s statute lets a trustee also serve as the lender without affecting the loan or the security, so a bank acting as both is permitted.

Who Can Be the Land Trustee for a Conforming Loan?

Freddie Mac requires the land trustee to be a corporation or financial institution customarily engaged in the business of acting as trustee for land trusts in the state. Banks with trust departments and established land trust companies are the trustees that rule describes. An owner acting as his or her own trustee does not meet it, and neither does a relative or the family accountant.

Two kinds of trustee fall in between, and Freddie Mac’s text does not settle them. The first is a newer trustee company without a track record as a land trustee. The second is a trustee organized as a limited liability company, which on a literal reading is neither a corporation nor a financial institution. Whether a lender and its title insurer accept either one is their decision, and it varies by lender. I treat the trustee as a lender question rather than a drafting one, and I get the lender’s answer in writing before the deed to the trustee is recorded, because changing trustees afterward means a recorded appointment of a successor trustee under Florida’s statute and a fresh review by the lender.

Practice pointer. Investors are often told to serve as their own trustee and swap in a company later. For a Freddie Mac land trust loan the trustee rule describes the trustee the trust has when the loan is made, so the swap plan fails at the closing table. I have the trustee approved by the lender first, and only then prepare the deed.

Why an LLC Beneficiary Rules Out a Conforming Loan

Freddie Mac requires every beneficiary of the land trust to be an individual. Fannie Mae’s exception for land trusts likewise applies only where the beneficiary is an individual. A land trust whose beneficiary is an LLC therefore cannot get a Fannie Mae or Freddie Mac loan, and neither can one with a revocable trust or a corporation as a beneficiary.

The LLC beneficiary is the structure most often recommended for rental property, and for a good reason. A land trust gives privacy and no lawsuit protection, and a multi-member LLC holding the beneficial interest adds the liability protection the trust lacks, as our Florida land trust guide explains. The two goals pull in different directions, so the structure has to be chosen with the financing in mind.

1. When a conventional loan is the plan, I name the client individually as the beneficiary at closing, and liability is handled with insurance and with how the property is operated. The collateral assignment bars moving the beneficial interest to an LLC later without the lender’s written approval.
2. When the property is bought for cash or financed by a portfolio or business-purpose lender, the LLC can be the beneficiary from the start.

The full comparison between holding real estate in an LLC and in a trust is on our LLC vs. trust for real estate page, and the costs of deeding property into an LLC, including the reset of the 10 percent assessment cap, are on transferring property to an LLC in Florida.

Practice pointer. A land trust agreement drafted with an LLC beneficiary for an owner who plans a conventional loan fails at underwriting. Settle the financing first, because the beneficiary named in the agreement decides which lenders can say yes.

Does a Land Trust Mortgage Put Your Name on the Public Record?

A Freddie Mac land trust mortgage keeps the beneficiary’s name off the recorded mortgage, because the trustee signs the mortgage and the beneficiary signs the note, which is not recorded. The deed into the trust names the trustee and the trust. A buyer who wants privacy and a conventional loan gets more of both from a land trust than from a revocable trust, because both agencies require each credit-qualifying settlor of a revocable trust to sign an acknowledgment on the recorded mortgage. The privacy comparison across all three structures is on our page on how to buy a house anonymously in Florida.

A name can still reach a public record in two ways.

1. The homestead spouse. Florida’s constitution requires the owner of homestead real estate, if married, to be joined by the spouse to mortgage it. Freddie Mac’s signature rule requires anyone whose signature state law needs to create a valid lien or waive inchoate rights. The spouse of a married beneficiary living in the home will be asked to sign the recorded mortgage. For the home you live in, a lady bird deed is usually a better fit than a land trust, and our page on a lady bird deed with a mortgage covers how that deed works with a loan.
2. The lender’s commercial-code filing. When the trust agreement declares the beneficial interest personal property, Florida’s land trust statute makes the state’s commercial code govern how a lender perfects its security interest in the beneficial interest, which means a financing statement (a UCC-1) naming the beneficiary as debtor. A financing statement is a public notice filing. Freddie Mac requires the collateral assignment to be valid and enforceable, and its text does not require the lender to file, so whether a UCC-1 is filed is the lender’s choice. When the agreement has no personal-property declaration, the statute instead requires the lender’s security document to be recorded in the county records.

I tell clients plainly that the lender, the title company and the closing agent all see who the beneficiary is. Privacy from the county record is a different thing from privacy from a court, a subpoena or a creditor who sues you, and a land trust gives no protection against any of those.

Putting an Already-Mortgaged Property Into a Land Trust

Most mortgages let the lender demand full payment when the property is transferred, which is the due-on-sale clause. Federal law bars a lender from enforcing that clause on a transfer into an inter vivos trust in which the borrower is and remains a beneficiary, on residential property with fewer than five dwelling units. The federal regulation reads the protection more narrowly. The regulation applies to a home occupied by the borrower, requires the borrower to give the lender reasonable means of being told about any later transfer of the beneficial interest or change in occupancy, and lets the lender enforce the clause if a later event disqualifies the transfer.

Three consequences follow for a land trust.

1. A rental is outside the regulation’s protection, because the regulation covers a home the borrower occupies. A lender can treat a deed of a mortgaged rental into a land trust as a transfer under the clause.
2. Whether a Florida land trust counts as an inter vivos trust under the federal statute is unsettled. Neither the statute nor the regulation answers it, and no court decision on the point turned up in our research. A written consent from the servicer removes the question.
3. Moving the beneficial interest later can trip the clause even after a protected transfer, because the regulation lets the lender act on a later event that disqualifies the transfer, such as the beneficiary moving out or assigning the interest to someone else.

The deed into the trust also carries documentary stamp tax questions when the property is mortgaged, because the mortgage balance can count as consideration, and the deed is priced before recording. A transfer into a land trust for the owner’s own benefit leaves the 10 percent cap on yearly assessment increases for non-homestead property in place. The same questions for a revocable trust are covered on can you put a house with a mortgage in a trust.

Practice pointer. Owners often send the servicer a copy of the whole trust agreement to show the transfer is harmless, which hands the lender every beneficiary’s name. I send a short letter describing the trust and the occupancy instead, with a request for written consent.

What to Ask the Lender Before You Sign

I put these six questions to the lender before the deed to the trustee is recorded, and I ask for the answers in writing.

1. Do you close Freddie Mac land trust loans in Florida, or do you have negotiated Fannie Mae terms for land trusts?
2. Will you and your title insurer accept this trustee, by name?
3. Who signs the mortgage, and will you require the beneficiary to sign it too?
4. Will you file a UCC-1 against the beneficial interest, and in whose name?
5. Which collateral assignment form will you use, and may we review it a week before closing?
6. What fees will the trustee charge for the lender package, and who pays them?

A lender that cannot answer the first question in a day is unlikely to close the loan on schedule. The answer to the third question decides whether the recorded mortgage names you, and the answer to the fourth decides whether a public filing does.

What It Costs

Florida land trustees publish annual fees of about $165 to $300 per property, and a bank trustee schedule we reviewed charges $250 to accept a trust and $300 a year. Trustees also charge per act. One Orlando trustee company lists $400 for closing coordination, $200 for an assignment of the beneficial interest and $500 to $2,500 for a lender package. Ask the trustee for its schedule before you choose it. My own fee for the legal work is quoted as a flat fee once I have read the trust agreement and the lender’s requirements.

Government costs, including recording fees and any documentary stamp tax, are additional and passed through at cost. Posted fees are honored for 90 days. The full schedule is on our pricing page.

Frequently Asked Questions

Common Situations

The situations below are illustrations built from common questions, not the stories of actual clients.

The duplex buyer who wants privacy and a 30-year loan. A buyer in Pinellas County plans to live in one side of a duplex and rent the other, and wants her name off the county record. Her draft land trust names her LLC as beneficiary. We change the beneficiary to her individually so a Freddie Mac lender can make the loan, confirm the trustee company with the lender before closing, and leave the LLC question for a time when she refinances with a lender that accepts one.

The refinance that stalled on the beneficiary. An investor holds three rentals, each in its own land trust with his multi-member LLC as beneficiary, and a conventional lender declines his cash-out refinance. We explain that the conventional route requires an individual beneficiary, and he chooses a business-purpose lender that lends to the LLC structure he already has, keeping the liability protection the LLC gives him.

The married couple and the recorded mortgage. A couple buying a home in Collier County want their names off the record and plan to use a land trust with a conventional loan. We explain that the lender will ask the non-borrowing spouse to sign the recorded mortgage because the home will be their homestead, and we compare that result with a revocable trust and with a lady bird deed before they choose.

Sources of Law

• Freddie Mac Single-Family Seller/Servicer Guide §5103.6, Land Trust (effective 07/02/2025): (a)(i) state recognizing land trusts by statute; (a)(ii) at least one beneficiary a fully underwritten Borrower; (a)(iii) “All beneficiaries of the Land Trust must be individuals,” trustee “a corporation or financial institution customarily engaged in the business of acting as trustee for land trusts in the applicable jurisdiction,” property “the only asset of the Land Trust”; (a)(iv) 1 to 4 unit primary residence, second home or 1 to 4 unit investment property; (b) beneficiary signs the Note individually, “The trustee of the Land Trust must execute the Security Instrument”; (c) Collateral Assignment terms and signatures, Form 50 an Illinois sample; (d) valid First Lien and Chapter 4702 title policy; (e) trust agreement, power-of-direction documentation, Fully Executed Collateral Assignment outside Illinois. Retrieved 2026-10-16.
• Freddie Mac Guide Glossary, “Land Trust” (beneficiary’s interest is personal property) and “Land Trust Mortgage” (a Mortgage secured by property whose title is held by a Land Trust). Freddie Mac Guide §4101.6 (signatures needed under state law “to create a valid lien, pass clear title, waive inchoate rights to property”). Freddie Mac Guide §5103.5(e) (each Underwritten Settlor of a Living Trust acknowledges the Security Instrument). Retrieved 2026-10-16.
• Fannie Mae Selling Guide B2-2-01 (09/03/2025) (exception for “land trusts in those states where the beneficiary is an individual”; “Fannie Mae permits land trusts on a negotiated basis for states where land trusts are widely accepted”). Fannie Mae Selling Guide E-2-04 (08/05/2026) (settlor’s acknowledgment added to the security instrument). Retrieved 2026-10-16.
• Fla. Stat. §689.071 (2025): (3) legal and equitable title vests in the trustee; (6) the beneficial interest is personal property only when the recorded instrument or trust agreement so declares, otherwise real property; (8)(c) chapter 679 governs perfection of a security interest in a personal-property beneficial interest, and a security document against a real-property interest is recorded in the county; (9) appointment of a successor trustee by recorded declaration; (10) the trustee may also be the creditor. Retrieved 2026-10-15.
• Art. X, §4(c), Fla. Const. (the owner of homestead real estate, “joined by the spouse if married, may alienate the homestead by mortgage, sale or gift”). Text verified against the in-repo constitutional transcription.
• 12 U.S.C. §1701j-3(d)(8) (no due-on-sale enforcement on “a transfer into an inter vivos trust in which the borrower is and remains a beneficiary”, residential property of fewer than five dwelling units). 12 C.F.R. §191.5(b)(1)(vi) (home occupied by the borrower; reasonable means of notice of a later transfer or change in occupancy) and (b)(5) (later disqualifying event); 12 C.F.R. §141.14 (“home”). Reading note: whether a Florida land trust is an “inter vivos trust” under the statute is not answered by either text, and no decision on the point was located. Retrieved 2026-10-16.
• Fla. Stat. §193.1554(5)(b) (transfer between legal and equitable title is not a change of ownership for the non-homestead cap); §201.02 (documentary stamp tax on deeds).
• Trustee fees: published fee schedules of Florida land trustee companies and a bank trustee schedule, and the Independence Title cost guide ($165 to $300 per year per property), read 2026-10-15. Vendor figures, not authority.
• Elgin State Bank v. Cowsert (In re Cowsert), 14 B.R. 335 (Bankr. S.D. Fla. 1981) (pledges of a personal-property land trust beneficial interest unperfected for want of a Florida filing; the land trustee that also lent against the interest held only a security interest). Read in full from the opinion text; the reporter citation is taken from later opinions citing it. Decided under the commercial code and land trust statute as they read in 1981. A bankruptcy decision is persuasive, not binding.

What a 1981 Bankruptcy Shows About the Collateral Assignment

The collateral assignment is the document in a land trust loan that I read most closely, because it is the lender’s only hold on what the borrower actually owns. The trustee’s mortgage reaches the land, and the assignment reaches the beneficial interest, and each one has its own rule for holding up against the borrower’s other creditors.

The clearest example I have read comes from the bankruptcy court in South Florida in 1981. An Illinois couple bought a condominium in Elgin, Illinois in October 1979 with a $42,400 purchase-money mortgage from one bank, and in January 1980 deeded it into a land trust they had set up in 1976 with a second bank as trustee. Both the deed and the trust agreement declared their beneficial interest personal property. The couple pledged that interest twice. The trustee bank took a collateral assignment for a $71,535 loan and filed a financing statement in Illinois only, and in September 1980 the mortgage bank took a junior assignment for $25,000 with no filing at all. The couple had moved to Florida in May 1980, and they filed for chapter 7 bankruptcy on January 16, 1981. Illinois law at the time protected a pledge of a land trust interest without any filing, and Florida’s version of the commercial code required one. The court applied Florida law because the couple lived in Florida, gave the trustee bank four months after the move to file in Florida, which it never did, and treated both pledges as unsecured. With the pledges out of the count, the condominium (worth at least $55,000 against a $43,000 mortgage) had equity, and the court refused to let the mortgage bank foreclose. The trustee bank had also argued that holding both the title and the pledge made it the owner outright, and the court held it was simply a secured creditor.

A common question I hear is whether a land trust keeps the owner’s name off the loan, and this case is where I start the answer. My reading of that case is that the pledges failed for a reason a Florida land trust loan can still repeat today, and I have a few take-home points.

The first is the filing. Florida’s land trust statute now sends a pledge of a personal-property beneficial interest straight to the commercial code, so the lender’s priority against your other creditors comes from a filing rather than from the signed assignment in its file. For a client who wants privacy, the filing is also the document that puts the beneficiary’s name in a public index. Practice pointer. Ask the lender whether it will file before you choose the lender, because that answer decides whether the privacy you paid the trustee for survives the loan.

The second is the double role. The trustee bank gained nothing by also being the lender, and Florida’s statute now says expressly that a trustee may be the creditor without changing the creditor’s rights. Practice pointer. A lender that asks to be named trustee as extra security is asking for nothing the collateral assignment does not already give it.

The third is that the court looked straight through the trust. In deciding whether the couple had equity, the bankruptcy judge counted their beneficial interest as an interest in the condominium itself, which is how a lender and a court see a beneficiary today. Avoid choosing a land trust to keep a lender or a court from learning who owns the property, because the trust keeps your name off the county record and nothing more.

The 1981 decision applied the commercial code as it read then, and both Florida’s and Illinois’s versions have been rewritten since, so I would not rely on its four-month figure without checking the current text. What has not changed is that a pledge of a beneficial interest is a personal-property transaction with its own rules, separate from the mortgage on the land.

Kevin D. Klagge, Esq., admitted in Florida since 2012. The case described above is a decision of a court rather than a matter handled by this firm. Past results do not guarantee a similar outcome.

Updated on October 16, 2026. Reviewed by Kevin D. Klagge, Esq., Fla. Bar No. 99502. General information about Florida law, Freddie Mac and Fannie Mae published rules, and our posted fees, not legal advice and no prediction that any lender will approve a loan. Each lender decides its own loans and may apply stricter requirements than the agency guides. No attorney-client relationship is created by reading this page. Do not send confidential information until we have agreed to represent you.