If you’re a struggling homeowner facing foreclosure in Florida, you should prepare yourself for the process by learning as much as you can about the state’s foreclosure laws. In this article, you can learn about:
You’ll also get information about significant protections for homeowners in foreclosure, like the 120-day preforeclosure period under federal law and the right to redeem (repurchase) the home under state law.
Under federal law, in most cases, a loan servicer must wait until you're over 120 days' delinquent before filing the lawsuit to start the foreclosure process. (12 C.F.R. § 1024.41). This preforeclosure period is a good time to submit an application for a loss mitigation option (an alternative to foreclosure), like a loan modification, to your servicer.
Federal mortgage servicing laws also provides other protections to homeowners facing a foreclosure.
In Florida, the foreclosing bank files a lawsuit in court to start the foreclosure and gives notice of the suit by serving the borrower with a summons and complaint. The borrower gets 20 days to file an answer with the court.
If you don't file an answer, the bank can get a default judgment from the court. On the other hand, if you file an answer, the bank will probably file a motion for summary judgment. This motion asks that the court grant judgment in favor of the bank because there’s no dispute about the important facts of the case, your defense lacks merit, or you haven't proven wrongdoing by the bank or servicer. If the court denies summary judgment, then a trial may happen. If the court grants summary judgment (or you lose at trial), the court will enter a final judgment of foreclosure against you. The foreclosure sale must take place 20 to 35 days after the judgment date unless the court order says otherwise. (Fla. Stat. § 45.031).
The bank has to publish a notice of the foreclosure sale in a newspaper once a week for two consecutive weeks, with the second publication at least five days before the sale. (Fla. Stat. § 45.031).
“Reinstating” is when the borrower catches up on the defaulted mortgage's missed payments, plus fees and costs, to stop a foreclosure sale from happening.
Florida law does not give the borrower the right to reinstate before the sale. But most mortgages give the borrower a certain amount of time to reinstate the loan. Or the bank might allow reinstatement, even if the mortgage contract doesn't provide this right.
Some states allow the borrower to redeem the home within a specific period after a foreclosure. In Florida, the borrower can redeem the home at any time before:
When the total mortgage debt exceeds the foreclosure sale price, the difference is called a deficiency. Some states allow the bank to seek a personal judgment—called a deficiency judgment—against the borrower for this amount. Other states prohibit deficiency judgments with anti-deficiency laws.
In Florida, the foreclosing party may obtain a deficiency judgment:
The foreclosing party has one year to request the deficiency judgment. This period begins the day after the court clerk issues a certificate of title to the buyer who purchased the home at the foreclosure sale. (Fla. Stat. § 95-11). If there are no objections to the sale, the clerk issues the certificate of title ten days after the certificate of sale.
The court has some flexibility when it comes to the deficiency amount. The amount can't exceed the difference between the judgment amount and the fair market value in the case of an owner-occupied residential property. (Fla. Stat. § 702.06).
In Florida, the bank (usually the high bidder at the foreclosure sale) will typically get a right to possession in the foreclosure judgment. After the clerk files the certificate of title, the bank can then file a motion for a writ of possession. Once the court grants the motion, the clerk of court issues the writ and the sheriff executes it.
This article contains citations to Florida’s foreclosure laws so you can read the statutes yourself. Keep in mind that statutes change, so checking them is always a good idea. (If you need help finding the statutes, see Finding Your State’s Foreclosure Laws.) How courts and agencies interpret and apply the law can also change. And some rules can even vary within a state. These are just some of the reasons to consider consulting a lawyer if you’re facing a foreclosure.
You should also consider talking to a lawyer if you want to get more information about foreclosure procedures in Florida or find out about potential defenses to a foreclosure. Moreover, it's a good idea to make an appointment to speak to a HUD-approved housing counselor if you want to learn about different loss mitigation options and how to apply for one.