Real Estate Law:
Florida Mortgage and Foreclosure Law Primer
- As in most states, Florida is a “Lien Theory” State whereby the property in question is the security for the loan. The “Mortgage” is considered the lien on the home and property.
- Florida law requires the use of “Judicial Foreclosure”, that is, all foreclosures are under the supervision of the courts.
- The lender begins the foreclosure proceedings by filing a “Foreclosure Complaint” with the Circuit Court.
- The filed Foreclosure Complaint must be accompanied with a “Lis Pendens”. This is proof or documentation that public notice has been given on the pending foreclosure.
- The time frame for a Florida foreclosure is dependent upon the court’s schedule. In Florida the process normally takes from 4 to 6 months for an uncontested foreclosure. The schedule can be stretched further if the borrower contests the foreclosure, files for delays or files for bankruptcy.
- Florida has a “Right of Redemption” Statue which allows a foreclosed home owner to reclaim his property by paying the full amount due plus costs. There is a time limit to invoke redemption.
- Florida has a “Deficiency Judgment” provision which can be invoked if the property is sold at auction for less than the balance owed. If this is the case, the homeowner will be held responsible for any shortfall.
Florida Mortgages Background
It used to be that mortgages were retained by the loan originator. Problems, if any, normally could be solved with just a simple phone call to your local bank manager. To keep valued customers, banks would try their best to accommodate clients. However, in time this changed. Investors started buying up the mortgages and thereby taking then out of your local bank. By the year 2000 the vast number of home mortgages had been packaged together and sold to investors. This has made a significant difference in how we can deal with our lender. These investors usually hire loan “servicers” who collect your payments, issue statements and notices, and in some instances initiate a foreclosure. Most get paid extra to foreclose on a property. This could be viewed by some as an incentive to foreclose on you.
Orlando Kissimmee Foreclosure Defense Explained
In simple terms, Foreclosure Defense is the fight that you engage in with your lender, who is attempting to foreclose on your property. The goal of your defense is to either stall or stop the foreclosure in its entirety. Fighting against these mortgage giants and their foreclosure machine might seem daunting, but do not give up hope; there are ways we can fight back.
When lots of these mortgages were bundled and sold, the banks didn’t always follow the law. Sometimes vital pieces of paperwork were misplaced, lost, or never even completed at all. Many have improper endorsements. In some cases, some “mortgage mills”, in order to expedite loans, forged signatures. This rushed transfer of loans created lots of errors. This is an area which your Foreclosure Defense Attorney can explore and utilize to delay or eliminate foreclosure.
Florida law requires that foreclosures occur within the supervision of the Circuit Court. The burden to prove that they have the right to foreclose falls upon your lender. This gives your Foreclosure Defense Attorney the right and opportunity to carefully examine all aspects of your loan and the circumstances it was given. It allows your Florida Foreclosure Defense Attorney the right to question any of your lender’s employees regarding your loan and examine their files.
Can your lender prove and document that they indeed own the mortgage and that they have the legal standing to file for foreclosure? If your loan was bundled and sold or transferred in any way, can they produce evidence that the transfer was done properly and according to the law? There have been many loans in which mortgage companies utilize employees who did not review loan applications but rather “rubber stamped” them. Some “reviewers” processed hundreds and sometimes thousands of applications each day. Foreclosure defense strategies often are focused around the shoddy record-keeping and sometimes unlawful actions by lenders.
Your lender didn’t necessarily have to make an error for you to take advantage of the defense strategies that a Foreclosure Defense Attorney can offer. Through the courts, he can stretch out the foreclosure process. Such delays might give you the time needed to develop a more permanent solution to your financial dilemma.
Given the widespread errors that lenders committed, contact David Chico Law Group today at 407-933-7703.