Occasionally I receive a call from someone who has lost their home to a foreclosure sale and was pressured by a third-party surplus recovery company to sign over their rights to the Florida Foreclosure Sale Surplus Funds and now they want to get out of that assignment of rights. Can you do this? Well, it really depends. There are rules in the Florida Statutes that the surplus recovery company has to follow, otherwise the assignment is not valid.
Florida Statute 45.033(3) deals with the Voluntary transfer or assignment of rights to the surplus funds. It states, “A voluntary transfer or assignment shall be a transfer or assignment qualified under this subsection, thereby entitling the transferee or assignee to the surplus funds or a portion or percentage of the surplus funds.” The statute then lists very specific requirements to the agreement that must be adhered to when a potential client signs over his/her rights to the surplus funds to another entity, like a surplus recovery company. For instance, the statute states, “the transfer or assignment is filed with the court on or before 60 days after the filing of the certificate of disbursements.” This can be a good way for you to get out of the agreement.
Based on the language of the statute, the assignment of rights to the surplus must be filed on the day of the filing of the certificate of disbursements, or within 60 days after that certificate of disbursements was filed by the clerk of court. Many of these shady surplus recovery companies will attempt to get you to sign up with them even before the foreclosure sale has taken place. They will then file the agreement with the court long before the certificate of disbursements has been filed. This is outside of the statute because it has to be filed on the day the certificate of disbursements was filed or within 60 days after, not before. The statute is very clear.
Next, there are some specifics that must be in the assignment and if they aren’t, it can be considered void. If the assignment is executed prior to the foreclosure sale, it must include a financial disclosure that “specifies the assessed value of the property, a statement that the assessed value may be lower than the actual value of the property, the approximate amount of any debt encumbering the property, and the approximate amount of any equity in the property.” However, if the assignment was executed after the foreclosure sale, it “must also specify the foreclosure sale price and the amount of the surplus.” If the assignment of the rights to the surplus doesn’t include these specific items, then the court could deem it to be invalid or void.
Lastly, many people feel they were coerced into signing with the surplus recovery company due to the constant harassing phone calls and felt like they had no other choice. This can sometimes be a major factor in winning an evidentiary hearing. Florida Statute 45.033(5) states that the transfer of rights must be made in “good faith”. Some judges find that if someone was pressured repeatedly into signing over their rights, then it really wasn’t in good faith. If the judge sides with the homeowner, then the surplus recovery company will be dismissed, and person can then either move forward on their own or hire an attorney. It is always my advice to hire a qualified Foreclosure Surplus attorney to help you get the most of your surplus funds.
If you have Florida Foreclosure Surplus Funds waiting for you with the Clerk of Court and have signed over your rights to those funds to a surplus recovery company, and now feel like you were pressured into it, please give me a call for free consultation on your case. I handle Foreclosure Surplus and Tax Deed Surplus cases in every county in the state of Florida and I don’t get paid unless you do.