Foreclosure Defense in Florida: What You Need to Know
If you are facing the threat of losing your home to foreclosure, you may feel overwhelmed and hopeless. However, you should know that you have rights and options to protect your property and your future. In this article, we will explain the foreclosure process in Florida, the common foreclosure defense strategies, and how a qualified attorney can help you achieve the best possible outcome.
The Foreclosure Process in Florida
Florida is a judicial foreclosure state, which means that lenders must file a lawsuit in court to initiate foreclosure proceedings. The foreclosure process typically involves the following steps:
- Notice of Default: When you miss mortgage payments, your lender will send you a Notice of Default (NOD), which informs you of the amount you owe and the deadline to cure the default. If you fail to pay the amount due by the deadline, the lender can proceed with the foreclosure.
- Lis Pendens: The lender will file a Lis Pendens, which is a public notice of the pending foreclosure action. This notice will be recorded in the county where the property is located and will alert potential buyers or tenants of the foreclosure.
- Foreclosure Lawsuit: The lender will file a complaint and a summons with the court, which will be served to you and any other parties with an interest in the property. The complaint will state the facts and legal grounds for the foreclosure, and the summons will notify you of the date and time of the hearing. You will have 20 days to file an answer to the complaint, in which you can admit or deny the allegations, raise any defenses, or request a dismissal of the case.
- Foreclosure Judgment: If you do not file an answer or if you lose the case, the court will enter a final judgment of foreclosure, which will order the sale of the property to satisfy the debt. The court will also set a date for the foreclosure sale, which must be at least 20 days after the judgment.
- Foreclosure Sale: The property will be sold at a public auction to the highest bidder, who will receive a certificate of title. The sale can be canceled if you pay the full amount of the debt before the sale, or if the lender agrees to a loan modification, a short sale, or a deed in lieu of foreclosure.
- Deficiency Judgment: If the sale proceeds are not enough to cover the outstanding balance of the loan, the lender can seek a deficiency judgment against you for the difference. The lender must file a motion for a deficiency judgment within one year after the sale. You can challenge the amount of the deficiency or claim exemptions to protect your assets from being seized.
Foreclosure Defense Strategies in Florida
Depending on your situation, you may have several options to stop or delay the foreclosure, or to reduce the impact on your credit and finances. Some of the common foreclosure defense strategies in Florida are:
- Loan Modification: A loan modification is an agreement between you and your lender to change the terms of your mortgage, such as lowering the interest rate, extending the repayment period, or reducing the principal balance. A loan modification can help you avoid foreclosure by making your monthly payments more affordable and bringing your account current.
- Short Sale: A short sale is when you sell your property for less than what you owe on the mortgage, with the lender’s approval. A short sale can help you avoid foreclosure by satisfying the debt and releasing you from the obligation to pay the deficiency. However, a short sale may have tax consequences and may affect your credit score.
- Deed in Lieu of Foreclosure: A deed in lieu of foreclosure is when you voluntarily transfer the ownership of the property to the lender, in exchange for the cancellation of the debt. A deed in lieu of foreclosure can help you avoid foreclosure by avoiding a public record of the foreclosure and potentially reducing the impact on your credit. However, a deed in lieu of foreclosure may also have tax consequences and may not release you from the deficiency.
- Foreclosure Defense Litigation: Foreclosure defense litigation is when you challenge the foreclosure in court, by raising legal defenses or counterclaims against the lender. Some of the possible defenses or counterclaims are:
- Lack of Standing: The lender must prove that it has the legal right to foreclose on the property, by showing that it owns the promissory note and the mortgage. If the lender cannot produce the original documents or evidence of the chain of assignments, you can challenge its standing to sue.
- Statute of Limitations: The lender must file the foreclosure lawsuit within five years from the date of the first default, or the date of the last payment. If the lender fails to do so, you can argue that the statute of limitations has expired and the case should be dismissed.
- Unfair or Deceptive Practices: The lender must comply with the federal and state laws and regulations that govern the mortgage industry, such as the Truth in Lending Act, the Real Estate Settlement Procedures Act, and the Florida Fair Lending Act. If the lender violated any of these laws or engaged in any fraudulent, abusive, or predatory practices, you can assert a counterclaim for damages or rescission of the contract.
How a Foreclosure Defense Attorney Can Help You
Foreclosure is a complex and stressful process that can have serious consequences for your future. If you are facing foreclosure, you need an experienced and knowledgeable attorney who can help you understand your rights and options, negotiate with your lender, and represent you in court. At Law Firm Ocala, we have the skills and resources to handle all aspects of foreclosure defense, from loan modification to litigation. We will work with you to find the best solution for your situation and protect your interests. Contact us today for a consultation and let us help you save your home.