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Florida Tax Deed Foreclosure Surplus Funds: 120-Day Rule

Today, we will be discussing Florida Tax Deed Foreclosure Surplus Funds and the 120-day rule that applies to claimants, that aren’t the former Homeowner, looking to file a claim for Florida Tax Deed Foreclosure Surplus Funds.

First and foremost, Florida Tax Deed Foreclosure Surplus Funds are the result of a Florida property being purchased for more than what is owed on said property’s past-due, or delinquent, property taxes at a Tax Deed Foreclosure sale. However, Fla. Statute 197.582(2)(a) states that “The clerk shall distribute the surplus to the governmental units for the payment of any lien of record held by a governmental unit against the property, including any tax certificates not incorporated in the tax deed application and omitted taxes, if any.” Meaning that the Clerk of Court, in which the property was sold, will first payout the Governmental Liens, if any, before notifying the former Homeowner and any additional Subordinate Lienholders, if any, that there are surplus funds available to be claimed.

For example: If there are delinquent property taxes owed on a Florida Property in the amount of $15,000 and the Florida Property sells for $100,000 at a Florida Tax Deed Foreclosure Sale, then there will be a surplus in the amount of $85,000! If there are no Governmental Liens that need to be paid out, then the $85,000 will be available to be claimed by the former Homeowner and any Subordinate Lienholder(s) with a recorded lien against the Florida Property in question, if any. If there are Governmental Liens against the Florida Property and they total $10,000, then this amount will be taken out of the total surplus leaving $75,000 available to be claimed by the former Homeowner and any Subordinate Lienholder(s), if any.

Once, there is a balance of undistributed surplus funds (meaning that there are still surplus funds remaining after the Governmental Liens have been paid) “the clerk shall mail notices to such persons notifying them of the funds held for their benefit at the addresses provided in s. 197.502(4),” according to Fla. Statute 197.582(2)(a). This is where the 120-day rule comes into play. Florida Statute 197.582(3) says “A person receiving the notice under subsection (2) has 120 days from the date of the notice to file a written claim with the clerk for the surplus proceeds.” I must emphasize the importance of this rule as it can be the deciding factor when there are two competing claims that have been filed for Florida Tax Deed Foreclosure Surplus Funds. I say that the 120-day rule can be the deciding factor because Fla. Statute 197.582(5) states “except for claims by a property owner, claims that are not filed on or before close of business on the 120th day after the date of the mailed notice as required by subsection (2), are barred.” Florida Statute 197.582(5) further goes on to say “The failure of any person described in s. 197.502(4), other than the property owner, to file a claim for surplus funds within the 120 days constitutes a waiver of interest in the surplus funds, and all claims thereto are forever barred.”

Additionally, Fla. Statute 197.582(9) mentions that “If the clerk does not receive claims for surplus funds within the 120-day claim period, as required in subsection (5), there is a conclusive presumption that the legal titleholder of record described in s. 197.502(4)(a) is entitled to the surplus funds. Thus, as you can see the 120-day rule is more detrimental to Subordinate Lienholders, seeking to file a claim for Florida Tax Deed Foreclosure Surplus Funds, as they can lose their right to the surplus funds if they do not file a timely claim. Meanwhile, the 120-day rule only emboldens the former Florida Homeowner’s, or former Legal Titleholder’s, claim to the Tax Deed Foreclosure Surplus Funds if the 120-day deadline has passed and there are Subordinate Lienholders who have yet to file their Claim. If there are no Subordinate Lienholders at all, then there is no need for the former Florida Homeowner to be concerned with the 120-day rule.

If you are a former Florida Homeowner who has recently had their home sold at a Florida Tax Deed Foreclosure Sale and have recently received a notice from the Clerk stating that there are Tax Deed Foreclosure Surplus Funds available for you to claim, please give me a call and I will personally give you a free consultation! During our consultation, I will answer any questions that you may have. I will also provide you with a personalized strategy as to how we will go about the claim filing process for YOUR Florida Tax Deed Foreclosure Surplus Funds. Moreover, if you are a former Homeowner who has recently had their home sold at a Florida Tax Deed Foreclosure Sale and are unsure as to whether, or not, there are surplus funds available to be claimed, please give me a call and I will personally look into your case to see if there are surplus funds available for you to claim.

At Haynes Law Group, P.A., we have experienced Attorneys who are well versed in the Florida Statutes governing former Florida Homeowners claims to foreclosure surplus funds and have helped to claim hundreds of thousands of dollars for former Florida Homeowners. We represent former Homeowners all over the state of Florida no matter what county they are in and will work tirelessly to ensure that you receive the Gold Standard of Legal Service. Best of all, we represent our Clients on contingency which means we don’t get paid unless you do!

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