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Foreclosure Surplus Funds - When You Might Not be Entitled to Those Surplus Funds

When we are contacted by new prospective Surplus clients, one of the things we look at is whether there is the possibility that any surplus funds could be claimed by someone else. There are many factors to take into consideration. The first is to see whether or not there are any actual Florida Foreclosure Surplus Funds available from the foreclosure sale of your home or that of a deceased relative. The second is to look for liens.

To check this, we will look to the filings from the end of the foreclosure case and then to what liens (if any) have been filed against the property. At the end of the foreclosure case and after the sale of the property through the court system, a Certificate of Sale is filed stating how much the property was sold for. Then a Certificate of Disbursements is filed that breaks down how much the property was sold for and they also calculate how much is to be sent to the lender to cover the Final Judgment, including any Interest and Attorney’s Fees. Once the interest and fees are calculated that amount is subtracted from the amount the property was sold for and the Certificate of Disbursements will list any Surplus Proceeds that are remaining. For instance, if the property was sold for $200,000 and the amount owed, including interest and fees, is $150,000 then the Surplus Funds held by the court will be $50,000. For our purposes, this is the amount we are starting with.

The next thing we will check is whether there any liens on the property besides the mortgage lien that was foreclosed on. For instance, there could be a second mortgage lien, a lien from the Homeowner’s Association for past due assessment fees, or even a lien from work done on the property from a contractor. If any liens on the property add to an amount over the surplus, then you don’t get anything if the lienholder file a timely claim. Referring back to our example, if there is a second mortgage on the property for $30,000 and a lien from the Homeowner’s Association for $5,000, then there is still a Surplus of $15,000. If there are subordinate liens that go up to or over the $50,000 of our surplus, then there won’t be any Surplus Funds and we would have to see if there is anything we can do to disqualify any of those subordinate lienholders. If they didn’t timely file a claim for example.

Once we have identified what liens there are, if any at all, then we may have to sit back and wait to see if any of these lienholders will make a timely claim for the surplus funds. According to Florida Statute 45.033, subordinate lienholders have one year to make a claim for the Florida Foreclosure Surplus Funds. Sometimes if the subordinate lienholder was not named in the initial foreclosure case or if they were and were defaulted, then we can ask the court to disburse the Surplus Funds before the year is up. Additionally, if there are no subordinate lienholders at all then we can request the Surplus Funds to be distributed without having to wait the full year.

Once the Certificate of Disbursements has been filed wit the Clerk of Court, it is time to begin working on your case. If you give me a call, I can give you a free consultation and evaluation of your case. I will look over your case and let you know if you are to receive any Florida Foreclosure Surplus Funds and whether there are any subordinate lienholders to look out for. I will work to make sure you get the maximum amount of the Surplus Funds you have coming to. I handle Foreclosure Surplus and Tax Deed Surplus Funds in every County in the State of Florida and I don’t get paid unless you do.

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