If you're buying a home in Florida, you might be surprised by a lesser-known cost that can sneak into your closing documents: the intangible tax. While not as widely discussed as property taxes or mortgage rates, this one-time fee can add hundreds or even thousands of dollars to your home purchase. Fortunately, credit unions offer a way to avoid it.
What Is the Intangible Tax?
Intangible tax is a one-time fee charged on loans that are backed by property, like a mortgage. The rate is usually 0.2% of the total loan amount or $2 for every $1,000 of the mortgage value.
For example, a $400,000 mortgage would incur an $800 intangible tax.
This tax exists to generate revenue from wealth that isn’t tied to physical assets. Unlike property taxes, which are based on the value of the home itself, the intangible tax applies to the loan amount. According to the Florida Department of Revenue, the tax is typically paid when the mortgage is recorded and is usually included in the borrower’s closing costs.
Why Credit Unions Don’t Charge It
Here’s where credit unions stand out. Both federally and state-chartered credit unions are exempt from the intangible tax under Florida law and federal statutes.
This exemption means that when you finance your home through a credit union, you won’t be charged this tax, allowing for savings that can make a meaningful difference in your closing costs.
The exemption is rooted in the Federal Credit Union Act and Florida Statute 213.12(2), which grant credit unions immunity from most state and local taxes.
VyStar’s Everyday Heroes Mortgage Program
VyStar Credit Union takes this benefit a step further with its Everyday Heroes Mortgage Program. It’s designed for first-time homebuyers in Florida and Georgia who work in public service such as educators, healthcare workers and first responders. The program offers:
Financing up to $1.2 million
Quick approvals
Fully digital, real-time loan tracking and more
For eligible buyers, the savings can be substantial. Avoiding the intangible tax alone can cut closing costs by hundreds of dollars.
Combine that with other perks like zero down and no PMI, and the Everyday Heroes program becomes a powerful tool for making homeownership more accessible. Apply for the Everyday Heroes Program now.