Today, we will be discussing Third-Party Purchasers and whether they are able to file a claim for Florida Foreclosure Surplus Funds. First and foremost, Third-Party Purchasers are those that purchase a property at foreclosure auction. Oftentimes, during the bidding process at a Florida foreclosure auction, Third-Party Purchasers will compete with one another to secure a particular property that will result in them paying more for the property than what was owed on the Final Judgment of foreclosure. When this occurs, there is what is known as surplus funds leftover. According to Fla. Statute 45.032(2) “there is established a rebuttable legal presumption that the owner of record on the date of the filing of a lis pendens is the person entitled to surplus funds after payment of subordinate lienholders who have timely filed a claim.” Florida Statute 45.032(1)(a) defines a former homeowner as “the person or persons who appear to be owners of the property that is the subject of the foreclosure proceeding on the date of the filing of the lis pendens.” As such, Third-Party Purchasers are not eligible to file a claim for surplus funds from a property they purchased at foreclosure auction as they were not the legal title owner of said property at the time the foreclosure action was initiated. Only the former homeowner(s) and/or eligible subordinate lienholders can file a claim surplus funds that may be available.
Moreover, I strongly advise that Third-Party Purchasers conduct a title search prior to placing a bid on Florida property at foreclosure auction. By conducting a title search, Third-Party Purchasers can protect themselves should there be other outstanding liens on the property they are looking to purchase.
For example: If a Third-Party Purchaser is purchasing a Florida property at a Florida Homeowners’ Association (HOA) foreclosure auction, then they should perform a title search to find out if there is an outstanding mortgage, or mortgage lien, on the property they are looking to purchase. If there is an outstanding mortgage, or mortgage lien, on the property, then the Third-Party Purchaser can simply not bid on the property. However, should they purchase the property, and not perform a title search, then they will be on the hook for satisfying the outstanding mortgage. Furthermore, should there be surplus funds available after their purchase of the property, then they will not be able to file a claim for said surplus funds nor will they be able to petition the Court to have the funds applied to any additional outstanding liens that may be tied to the subject property. Thus, why I strongly advise that Third-Party Purchasers conduct a title search prior to placing a bid on a Florida property at foreclosure auction.
***If you are reading this as a former Florida Homeowner whose home has recently been sold at a Florida foreclosure auction and you would like to know whether there are surplus funds available for you to recover, then please give me a call and I will personally give you a free consultation. During our consultation, I will confirm whether there are surplus funds available to be recovered as well as answer any questions that you may have. If there are surplus funds to be recovered, then I will also provide you with a personalized strategy as to how we can assist you with the recovery of YOUR Florida foreclosure surplus funds.
At Haynes Law Group, P.A., we have experienced attorneys who are well-versed in the Florida statutes governing Florida Homeowners’ claims to Florida foreclosure surplus funds and have helped to recover millions of dollars for former Florida Homeowners. We represent former Homeowners all over the state of Florida no matter which county they are in and will work tirelessly to ensure that you receive the Gold Standard of Legal Service.***