Florida Foreclosure Questions Answered

In most Florida foreclosure cases, a homeowner who has been served with the summons and complaint generally has 20 days after service to respond to the lawsuit. The summons should state the applicable deadline.

Missing that deadline can put the homeowner at risk of a default and allow the foreclosure case to move forward without the homeowner fully participating in the defense.

If you have been served, do not assume that talking with your mortgage company or applying for a loan modification stops the court case. The lawsuit and the mortgage-servicing or loan-modification process can move on separate tracks.

First, do not ignore the papers. Note the date you were served and keep the summons, complaint, and everything that came with them.

Next, gather your mortgage documents, recent statements, payment history, correspondence with the servicer, and any loan-modification or loss-mitigation paperwork.

Consider having the lawsuit and your loan history reviewed promptly, before your deadline to respond. The documents and history may reveal defenses, servicing problems, or other options that are not obvious from the foreclosure complaint alone.

Most importantly, understand that being served with a foreclosure lawsuit does not mean you have already lost your home. It means a court case has begun, and the lender still has to establish its right to foreclose.

Sometimes. The available options depend on the facts, how far the case has progressed, the homeowner’s goals, and whether there are legal or servicing issues that affect the foreclosure.

Depending on the circumstances, options may include defending the lawsuit, correcting servicing errors, pursuing loss-mitigation options, negotiating a resolution, reinstating the loan, or challenging the lender’s right to foreclose when appropriate.

There is no single strategy that fits every foreclosure. The important question is what can realistically be accomplished in your particular case.

Yes. Communicating with the mortgage company or pursuing a loan modification does not necessarily stop a pending foreclosure lawsuit or eliminate the need to respond to it.

Homeowners sometimes assume the court case has stopped because the servicer is reviewing documents, considering a modification, or discussing other options. That assumption can be dangerous.

Pay attention to both processes. Unless the foreclosure case has actually been stayed, dismissed, or otherwise resolved, court deadlines may continue while you work with the mortgage company.

Mortgage servicing mistakes can matter. Problems may involve misapplied or missing payments, incorrect balances, escrow errors, improper fees, inaccurate account information, mishandled modification applications, or failures to properly address borrower disputes.

Not every servicing error creates a legal claim or defeats a foreclosure. But some errors can affect the amount allegedly owed, whether required procedures were followed, or the lender's ability to prove its case.

The servicing history can be just as important as the foreclosure complaint itself. A careful review of the loan history, payment records, servicing records, correspondence, and foreclosure documents may reveal problems that are not obvious from the lawsuit alone.

It depends on the circumstances and the stage of both the foreclosure and loss-mitigation processes.

Federal mortgage-servicing rules restrict certain foreclosure activity in some situations when a servicer has received a complete loss-mitigation application. Other rules, deadlines, exceptions, and investor requirements may also apply.

Do not assume that applying for a loan modification automatically stops a foreclosure lawsuit or sale. Unless you know that the foreclosure has actually been stayed, dismissed, or otherwise halted, continue to pay attention to the court case and every applicable deadline.

“Wrongful foreclosure” generally refers to situations in which a lender or servicer pursues foreclosure despite a significant legal, procedural, payment, servicing, or documentation problem.

Examples may include a lender that cannot establish its right to enforce the loan, failure to satisfy required conditions before filing suit, serious payment or accounting errors, or foreclosure activity that violates applicable servicing requirements.

Not every mistake makes a foreclosure wrongful. The facts, loan documents, servicing history, applicable law, and procedural history must be examined carefully to determine whether an error provides a defense or other legal remedy.

Potentially. If a foreclosure sale does not generate enough money to satisfy the debt, the lender may seek a deficiency judgment for some or all of the remaining amount, subject to Florida law and the circumstances of the case.

A foreclosure sale therefore does not necessarily end every financial issue associated with the mortgage. Whether a deficiency can be pursued, and for how much, depends on the facts of the particular case.

If a potential deficiency is a concern, it should be considered before the foreclosure is resolved, not discovered as an unpleasant surprise afterward.

Sometimes a foreclosure sale produces more money than is needed to satisfy the foreclosure judgment and certain other claims and costs. The remaining money may constitute surplus funds.

The former homeowner may be entitled to some or all of the surplus, although other parties may also have valid claims to those funds.

Surplus funds are not necessarily paid to the former homeowner automatically. If you believe a property sold for more than was owed, it may be worth determining whether surplus funds exist, who may have a claim to them, and what steps are required to recover them.

Before, whenever possible.

Once a foreclosure sale occurs, the available options can become substantially narrower. Before the sale, there may still be time to evaluate defenses, servicing problems, loss-mitigation issues, settlement possibilities, or other strategies.

If the sale has already occurred, do not assume there is nothing left to review. Depending on the circumstances, there may still be issues involving the sale itself, possession of the property, potential deficiency liability, or surplus funds.