When a mortgage goes into default Florida Foreclosure law allows only for judicial foreclosure. A judicial foreclosure begins when the lender files a lawsuit asking a court for an order allowing a foreclosure sale to take place. Generally, the borrower will get 20 days to file an answer to the complaint with the court. If the borrower fails to respond to the suit, the lender asks the court for, and typically receives, a default judgment, which will allow it to move forward with a foreclosure sale.
In Florida foreclosure, the lender files court action and records a notice of a pending lawsuit called a Lis Pendens (LIS), against the borrower. The lender is required to notify the borrower and any other affected parties in person or by mail or publication.
The lender is not required by Florida state law to notify the borrower before initiating the foreclosure process, however, individual mortgages or deeds of trust may require them to do so. The borrower can stop the foreclosure up until the date of the sale by paying the total amount owed to the lender.
Recent changes to Florida Foreclosure law have both helped and hurt borrowers. Servicers and lenders generally have to provide borrowers with loss mitigation opportunities, account for each foreclosure step, and strictly comply with foreclosure laws. Also, since most borrowers in Florida sign a promissory note and mortgage, these documents almost always give homeowners some contractual rights in addition to federal and state legal protections.
In a Florida foreclosure, a borrower will typically get the right to:
- receive a “preforeclosure breach letter”
- apply for loss mitigation
- get notice of the foreclosure and the chance to respond in court
- get current on the loan and stop the foreclosure sale
- receive special protections if they are in the military
- pay off the loan to prevent sale
- file for bankruptcy
- get any excess money after a foreclosure sale.
Notice of Sale & Auction
The foreclosure sale date is between 20-35 days after the court ruling, however, this can vary depending on the individual court and county. The clerk of court issues a public notice of sale containing the location, date, and time of the sale. The notice is published once a week for two weeks, in that counties newspaper, with the second notice appearing a minimum of five days before the sale.
The county clerk usually oversees the sale, which ordinarily occurs at the county courthouse at 11:00 a.m. on the sale date. The winning bidder must provide a 5-percent deposit and pay the remaining balance by the end of the day. If the winner fails to pay the deposit or the balance, a new sale is scheduled a minimum of 20 days later. After a successful sale, the county clerk gives a certificate of sale to the winning bidder. This is NOT a deed.
Within 10 days of the sale, the clerk transfers ownership to the winning bidder by deed if no one disputes the sale.
A borrower has no right of redemption after the certificate of sale, unless they can prove that some sort of mistake has been made by the lender, the lender’s attorney’s or the court.