Foreclosure is certainly a term that doesn’t bring along any positive associations. Most homeowners strive to avoid foreclosure in FL at any cost and are ready for selling a house if it means avoiding foreclosure.
Foreclosure in FL is not always something that you expect or have planned for. Perhaps an unexpected situation has resulted in financial instability and the inability to make mortgage payments on time. So what can you do? Can you sell a house in foreclosure in Gainesville FL? Can you avoid foreclosure in Florida? Can you sell your house as-is or does the Florida real estate market have specific rules and regulations that won’t allow you to escape foreclosure with a home sale?
In this article, we’ll answer the question of how to avoid foreclosure in Florida. We’ll look at what pre-foreclosure is, the foreclosure process, and foreclosure laws in FL and will help you become more familiar with the real estate market. This article will help you understand the foreclosure process in FL and will support you in selling a house in FL.
Florida Foreclosure Laws
If you’re at risk of foreclosure, it’s essential that you become familiar with the Florida foreclosure laws. Knowing the foreclosure laws in FL will help you make the right decisions and protect your interest, even possibly avoid foreclosure. For instance, you may be hoping to sell your house yourself or with a realtor and avoid the expensive and lengthy foreclosure process. But can you sell a house in foreclosure in Gainesville FL?
Let’s find out.
Every state has its own foreclosure laws. As borrowers, there are a number of rules and regulations in place that offer protection for you.
In Florida, you have the following rights:
- Get a pre-foreclosure breach letter
- Request loss mitigation
- Receive notice of the foreclosure and the opportunity to respond in court
- Stop the foreclosure sale by getting current on the loan
- Benefit from special protection in case you’re in the military
- Repay the loan to avoid a foreclosure sale
- File for bankruptcy
- Receive excess money once the foreclosure sale is finalized
In Florida, among the laws for foreclosure that you should be familiar with include the requirement for the lender to file a lawsuit in court to foreclosure. In this case, they file the suit and provide notice via a summons and complaint.
Not all foreclosure sales provide enough money for the loan to be paid off in full amount. In case of a deficiency balance, Florida permits the lender to receive a deficiency judgement or personal judgement to this amount against the borrower. It could be received as part of the foreclosure process or as an independent lawsuit. The lender only has a year to demand the judgment in case the house is a one-family to a four-family dwelling unit.
What is Pre-Foreclosure?
You may be asking yourself the question what is pre-foreclosure. Pre-foreclosure is the initial step in the foreclosure process. Pre-foreclosure in FL happens when a homeowner is no longer able to make mortgage payments on time and requests from the lender a notice of default. The notice of default is an official document that puts the start of the legal process of foreclosure in FL.
But what does the pre-foreclosure process in Florida look like?
During pre-foreclosure in Florida, the servicer is capable of charging your different fees such as late charges and inspection fees. However, they must also notify you about what you can do to avoid foreclosure and provide you with a breach letter or a pre-foreclosure notice. Keep in mind that there is a certain period, also known as the grace period, during which you will not be fined or in any kind of trouble for missing mortgage payments. This period usually lasts for up to 15 days after the payment was due.
Under pre-foreclosure laws in Florida, once the grace period is over, the servicer has the authority to charge you a late fee. The fee is usually included in your promissory note and your mortgage statement. In a lot of cases, lenders in Florida will be permitted to seek alternatives that will allow them to protect themselves and their property from foreclosure. You can expect to pay for property inspections or fees for broker’s price opinions or appraisals.
What is the Foreclosure Process in Florida?
If you are no longer able to make mortgage payments on your property in Florida, you will be exposed to a judicial foreclosure. Let’s take a look at the foreclosure process in Florida in more detail.
For a judicial foreclosure in Florida to commence, the lender must file a lawsuit requesting a court for an order permitting a foreclosure sale. In most cases, you will receive 20 days to provide an answer by filing it with the court. If you fail to do this, the lender will require a default judgment, which gives them the legal rights to conduct a foreclosure sale.
If you provide an answer, there will be a litigation process in place. It’s possible that the lender will demand the court to grant judgment in their favor due to the lack of dispute. In this case, or if you were to lose at trial, the property will be officially sold in a foreclosure sale.
Publication of a Notice of Sale
To announce a foreclosure sale, the lender is obliged to publish a notice about the sale in local newspapers every week for two consecutive weeks. The second publication must be no less than five days prior to the sale.
The publication of a notice of sale should include:
- A full property description
- The time & place of the property sale
- A statement revealing that the sale will be conducted to the order or final judgment
- The auction’s caption
- Information about the clerk making the sale (usually a name)
- A statement notifying that anyone who claims an interest in the excess from the sale other than the property owner is obliged to file a claim prior to the announcement that the surplus is unclaimed.
The sale itself must happen 20 to 35 days after the judgment date. The sale could be conducted more than 35 days after the date of final judgement if the plaintiff or their attorney agrees. A publicly available auction takes place where the bidding for the property is conducted. Normally, lenders will bid on the property with a credit bid, where the lender receives a credit up to the sum of money that equals the borrower’s debt.
The lender has the right to bid for the total amount owed with fees and costs included, or they could bid less. Whoever is the highest bidder wins the ownership of the property.
If the lender is the highest bidder but bids less than the total amount of the debt, a deficiency judgment against the borrower can be issued. On the other hand, the foreclosure process in Florida allows the homeowner or borrower to receive any excess money from a foreclosure sale made to the highest bidder that is not the lender if the sale amount is larger than the debt.
The court clerk is obliged to quickly file a certificate of sale once the foreclosure sale is complete, which should take place a day after the sale. Once it is filed, you have 10 days to file an objection to the sale. If no objection is filed, the sale is confirmed and a certificate of title is issued to the new owner.
Can You Sell a House in Foreclosure in Florida?
If you’re looking for ways to avoid foreclosure, you may be searching for options to “sell my house fast Florida”. But can you sell a house in foreclosure in FL?
The answer is yes. Selling a house in foreclosure in FL is an option that you can take. The Florida real estate market is dynamic and the good news is that you are likely to quickly attract buyers to your property. However, there are a few important things to consider when it comes to avoiding foreclosure via a home sale.
If you’re received a notice of foreclosure in Florida, you can still sell your property by yourself before the scheduled auction date. Home selling in such a case could be the best solution you have, especially if you’re afraid your financial struggles are not something temporary but are rather long-term and more complicated than you’ve expected. Look for companies that market themselves as “we buy homes in Gainesville High Springs” or other locations near you if you want to enjoy a quick sale. In most cases, these are experienced property investors that can quickly react and make the decision.
If you’re asking yourself whether you should sell a house in foreclosure in FL, don’t forget that you have equity in your property that you can use to avoid financial struggles and negative consequences. However, it’s best to plan ahead instead of waiting for the last minute. If you detect that you are about to fall into a financially unstable situation, either talk to your lender to explain the situation or consider selling your home before you are at risk of foreclosure.
How to Sell a House in Foreclosure in Florida
We’ve now covered most of the basics around foreclosure in Florida. It’s time to move on to the most exciting part – how to sell a house in foreclosure in FL. You have a few options to explore when it comes to selling a house in foreclosure and being aware of them will help you make the right decision.
You could find cash home buyers that offer a fair cash deal for your property. A cash deal is a lot quicker than a standard home sale and requires no dependency on mortgages from the buyer. It’s also one of the most certain ways out of foreclosure. If you’re interested in receiving a cash offer on your house, it may be worth searching for experienced property investors in your area. The Florida real estate market is heated so working with a realtor could also help you discover potential buyers. However, keep in mind that not everyone will be willing to invest in a property that is at risk of foreclosure due to insecurities.
So what are the steps for selling a house in foreclosure in FL? Here are some of the ways to avoid foreclosure via a home sale in the pre-foreclosure phase.
Determine your property’s value
Make sure you’re fully aware of how much your property is actually worth. Don’t rely on intuition and certainly don’t use your loan amount as a basis for setting an asking price on your home. Sometimes, when under stress, homeowners are tempted to set a price that is too high for the local area or for the size and condition of the property. This can dramatically slow down the selling process and may prevent potential buyers from showing interest. Especially if you’re in a hurry to sell your home, setting the right asking price is crucial.
You can use free online tools to establish a property’s value or you can work with a professional who can give you a realistic idea of the appropriate asking price.
Make your calculations right
Think about what you owe to your lenders and take into consideration any late fees. In case you have already received a foreclosure notice, chances are that you are already behind on payments that you’ll need to make up for. Late fees are normally charged in a time period between 10 and 15 days after the first missed payment. You may also be subject to accrued fees from the mortgage company attorney. To make your calculations, make sure you closely observe all the documents and noticed you’ve received. Don’t forget about any outstanding principal and interest and take it away from the sale price you are considering.
Take away any selling expenses
Unfortunately, selling a house doesn’t only mean taking money. It also means giving money. There are a number of closing costs that you need to be prepared for when selling your house to avoid foreclosure. These may be agency fees, any expenses for preparing the house for a sale like renovations and repairs, sellers concessions, moving costs, and more. The selling expenses are never the same for home buyers as they depend entirely on your situation and needs.
The main idea behind calculating your selling expenses is to figure out whether the amount you are left with after the sale will be enough to cover your loan. In some cases, you may even be left with a small amount to help you get back on your feet after the sale.
Work with an experienced agent
Although you could sell your house by yourself to avoid foreclosure in Florida, the reality is that it’s not a simple process. To ensure you have your interests protected and that you remain on the right side of the law, it’s recommended to work with an experienced real estate professional who can guide you through the journey. They’ll be able to promote your property in the best possible way and ensure the right potential buyers see it, they can help with any legal documents, they can offer exceptional negotiating skills, and more. You can enjoy peace of mind knowing that you’re working with a specialist who will help you prevent foreclosure and will support you in exiting this situation in the best possible way given the circumstances.
Communicate with your lender
One of the most essential parts of avoiding foreclosure and perhaps the most neglected one is to constantly communicate with your lender. Just like you, your lender is a human being who, in most cases, will be able to put themselves in your shoes. Inform your lender about your plans to sell your property to repay to loan. The truth is that the majority of lenders would prefer to help you sell your house rather than foreclose and sell it at your loss. Being open could save you a lot of stress and could turn your lender into a partner in your selling endeavors.
As you can see, even if you’ve been stuck thinking that there is no other option for you to save yourself and prevent foreclosure, the reality is that this is far from the truth. We’ve looked at the foreclosure process in Florida, the FL foreclosure laws, what pre-foreclosure is, and have provided useful tips on how you can sell your house to avoid foreclosure. Hopefully, the information provided in this article will come in handy if you find yourself in a similar situation. If you’re interested to find out more about the topic, check out our case study on foreclosure.