When home is foreclosed in Florida, homeowners’ association (HOAs) liens can be passed on to the home’s new owner. If you buy a condominium or single family home at auction that is included in a mandatory HOA and has been foreclosed on, check to make sure the HOA dues are current. Depending on your state, associations have the right to file a lien on the property for unpaid assessments. Unpaid maintenance fees and HOA dues will continue to increase as the unit or home goes through the foreclosure process. Most associations will try to recover the money (up to 1 year’s worth) from the bank if the lender takes possession of the property, and it does not sell at auction.
HOA liens frequently survive foreclosure and are passed on to the new owner to pay current when the property is bought at auction. The association will not allow the bank to transfer ownership or title to the new owner unless the account is paid. A negotiation in lowering the dues may be done by the bank beforehand in the event that the property fails to appeal to buyers or can be negotiated into the sales price depending on the bank and association.
In most cases, the HOA takes a loss in their fees and end up collecting an additional deposit from new buyers in order to safeguard the possibility of another foreclosure and to make up for lost income.
Stephen K. Hachey, a Florida real estate attorney, can help you navigate this and many other legal matters. To receive a free consultation, contact our offices at 813-549-0096.
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The foreclosure process is a difficult one for all parties involved, the lender, the borrower, and the new owner. It’s easy to forget, or not even know, what all of your options are. The basic foreclosure process begins with a “Notice of Default.” The lender is then responsible for filing a “suit pending,” which gives the borrower 20 days to file an answer to present their side at a hearing. After 20 days, the lender’s attorney will file a motion to declare a summary judgment.
A “Summary Judgment” is a court preceding that determines some or all of the case without a trial. The lender, or bank, is asking for title and possession of the property. Without counterclaims from the borrower, the court will issue an Order of Default, which admits the case. On the other hand, if the borrower submits a response and the matter goes to a hearing where the property owner can submit proofs by affidavit.
In most cases, the borrower will not be able to successfully argue the foreclosure. A sale date will be set within 45 days of the hearing. The judge can extend the sale date out another 120 days if the borrower would like to attempt a short sale. A legal ad of the sale will be published for two full weeks in local circulation before the Clerk of Circuit Court conducts the sale.
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Every state has a process for homes in foreclosure. What a lot of people don’t tend think about is where will they live after the foreclosure is final. The foreclosure process consists of court hearings, bank meetings, and an auction to sell the property. The title is still in the owner’s name until the final sale of the property, but how long can an occupant remain on the property once a new title is issued?
Depending on how much you are willing to fight for your home, you have 10 days after the auction to object before the court will issue a title. The foreclosure is final when the property is sold “on the courthouse steps” to the highest bidder. The sale usually takes place between 28-35 days after the entry of the final judgment of foreclosure. Many judges will give you 60 to 90 days if you attend the hearing. The amount of time you have left on the property will primarily depend on the motivation of the new property owner.
There are a few things the new property owners will do. The first one is known as keys for cash. Typically you will see offers from $1500 to $5000 to help with relocation, but this will depend on the owner. The second option for new property owners will be to keep you on as a tenant. Some buyers invest in foreclosed properties, but don’t need to have them as a primary dwelling. Finally, the new property owner will ask you to leave within a certain amount of time.
If you have foreclosure questions Stephen K. Hachey, a Florida real estate attorney, can help. Contact him at 813-549-0096.
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The housing market has finally started to turn itself around, there are fewer and fewer “for sale” signs and better mortgage rates than there were 8-10 years ago around this time. However, since the time has finally passed this means that the rough economic decisions you might have had to make might start really showing their true colors. It takes a while for the red to show up on your ledger, but how long, and for what period of time will this red mark remain on your credit report?
A credit report is generally updated every 30 days to line up with creditors billing cycles. Within 30-90 days after your delinquent mortgage payments, the lenders will start the foreclosure process. Once the bank files for a foreclosure, rules the loan delinquent, and processes the sale of the home, the entire process can take between 90-180 days. The foreclosure will appear on your credit report at a similar time. It’s possible for it to show up on your report a few days after the sale, or up to 30 days afterwards depending on where the bank is in their billing cycle.
In some states, the foreclosure process can take several months or even years, while in others, it can happen relatively quickly. Generally, the longer the foreclosure process takes, the longer it will take for the foreclosure to appear on your credit report.
How Does Foreclosure Affect Your Credit Score?
The impact of a foreclosure showing up on your credit report is roughly a 35 percent decrease in your credit score for the first year. The impact is likely to be more severe for the first two years, lessening as time goes on. Ironically enough, the higher your score was before the foreclosure the more negative impact it will have.
According to FICO, the company that calculates credit scores, foreclosure can lower your score by as much as 300 points. This is a significant drop and can make it difficult to obtain credit in the future.
How long does a foreclosure stay on my credit report?
The foreclosure will remain on your credit report for up to seven years, making it difficult to rebuild your credit. The duration that a foreclosure stays on your credit report depends on the credit bureau reporting it, and it typically starts from the date of the first missed payment. Once a foreclosure appears on your credit report, it can be challenging to remove it before the seven-year period is up.
As mentioned above, the impact of foreclosure on your credit score diminishes over time, and you can take steps to rebuild your credit score. You can start by paying your bills on time, reducing your debt, and applying for a secured credit card.
How does a foreclosure affect my ability to obtain credit in the future?
Once a foreclosure appears on your credit report, lenders may view you as a high-risk borrower, and it can make it challenging to obtain credit or loans. If you do get approved, you may be charged higher interest rates, which can cost you more money in the long run.
The severity of the impact of foreclosure on your credit score depends on several factors, such as the number of missed payments, the amount owed, and the time since the missed payment. However, the foreclosure itself can result in a more significant drop in your credit score. It is essential to take steps to minimize the impact of foreclosure on your credit score, such as working with your lender, paying off outstanding debts, and rebuilding your credit. Remember, with the right approach, you can recover from a foreclosure, and it is not the end of the road.
What Can You Do to Minimize the Damage of Foreclosure?
If you are facing foreclosure, there are steps you can take to minimize the damage to your credit score. Here are some tips to consider:
Work with your lender. If you are struggling to make your mortgage payments, contact your lender immediately. They may be willing to work with you to find a solution that allows you to keep your home and avoid foreclosure. For example, they may be willing to modify your loan or temporarily reduce your payments.
Consider a short sale. A short sale is when you sell your home for less than the amount owed on the mortgage. While it will still have a negative impact on your credit score, it is typically less damaging than a foreclosure. Additionally, it can help you avoid the legal and financial consequences of foreclosure.
Get professional help. If you are struggling with your mortgage payments, consider seeking professional help. A housing counselor can work with you to develop a plan to keep your home and avoid foreclosure. They can also help you navigate the foreclosure process and understand your rights as a homeowner.
Rebuild your credit. If you have experienced a foreclosure, it is important to start rebuilding your credit as soon as possible. This can include paying your bills on time, reducing your debt, and using credit responsibly. While it may take some time, you can improve your credit score over time with responsible credit behavior.
Foreclosure can have a significant impact on your credit score and financial well-being. It is important to understand when foreclosure shows up on your credit report, how it affects your credit score, and what you can do to minimize the damage. If you have foreclosure questions Stephen K. Hachey, a Florida real estate attorney, can help. Contact him at 813-549-0096.
Losing your house to foreclosure can be a terribly challenging and upsetting time for homeowners. But just because the home went up for foreclosure doesn’t mean you have to just walk away from it. Did you know that you can actually bid on your own property at a foreclosure sale?
You may be wondering, if this is true, why don’t more people do it? Well, it’s actually not that difficult to explain. When you bid on a home, sometimes you are expected to have the cash upfront to pay for the home in as little time as 24 hours. And the cost of the foreclosed home can actually turn out to be more than what the homeowner paid.
A first mortgage foreclosure starting bid not only includes all monies owed by the previous owner, but also the cost of foreclosure, the interest on defaulted payments as well as any fees that were not paid or were owed due to defaulting on a loan. So while it is possible to bid on your own home, the starting bid is often too high for many homeowners to be able to acquire cash for. But it can be done.
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It can be difficult to think of foreclosure as a reality. When the economy is going through tough times, we feel it, and it can spell disaster and heart break for families that are threatened with foreclosure. However, there are several alternatives to foreclosure that you may want to look into. Here are a few to explore if you find yourself in this situation.
The first is Loan Modification. This is for homeowners who can pay a portion of their loan amount but not the whole thing. In this situation, the individual and the bank agree on a lowered monthly payment that the homeowner will pay in monthly installments. It sounds easy, but it can be a lengthy process, and even though the bank will let the homeowner pay reduced amounts each month, the interest rates may be higher or the length of the loan may be lengthened to make up for the altered plan.
The second is a short sale. This is a situation where the homeowner sells their property for less than the debt they owe on the property and the bank “forgives” the rest of their debt on the property. To prove that you are eligible for a short sale, you will need to prove that you are in severe financial hardship, you don’t have enough money to cover the remainder of your debt, and your home is worth less than the amount you owe to the bank.
The last is a forbearance. This is an alternative to a foreclosure where the bank allows the borrower to pay a lower amount than what they owe for a certain period of time. The conditions are such that you are experiencing a temporary financial hardship and you have not missed any previous mortgage payments.
These are just a few alternatives to consider if you are facing foreclosure. Stephen K. Hachey is a Florida real estate attorney who can help you make the choice that right for you and your family. Contact him at 813-549-0096.
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No one wants to find themselves in this kind of situation: the victim of fraud, theft, manipulation. But unfortunately scammers are out there, and able to take advantage of unsuspecting people. Real estate scammers are among the biggest problem in today’s market. Let’s take a look at some of the scams you may have paid into and what you can do to protect yourself from it again in the future.
The first is renting empty homes. A scammer may find an empty home, which is still owned by someone else, and rent it out to an unsuspecting person. The renter will send money then later find out they had been scammed into paying for a space that is already owned by someone else.
The next is renting foreclosed homes. A common foreclosure scam involves a fake agent taking unsuspecting couples on a tour through a burglarized home. The “agent” offers a fake email address and out-of-service telephone number after payment and the family never hears from him/her again.
Another common real estate scam is renting unavailable apartments to out of town renters. Some renters look for spaces to live for a few weeks while they are on vacation or in town on business. The fake agent will ask renters to wire money directly to them. When the renter shows up, they find out the property isn’t really for rent, and they have nowhere to stay.
To avoid these situations, there are a few things to remember:
1) If it seems too good to be true, it probably is.
2) Do your homework, and work with a real estate agent to protect yourself from crime.
3) Check online reviews of agents before committing.
4) Avoid using cash or wiring money, and instead, use a traceable form of payment such as checks or credit cards.
Use these tips to protect yourself from real estate crime and scams.
If you are a victim of a real estate scam, there is help. Stephen K. Hachey, a Florida real estate attorney, that can help you make the most of a difficult situation. Contact him at 813-549-0096.
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In the unfortunate event that an owner must be evicted from their home in Florida, there are a series of steps that need to be taken. After a foreclosure, a bank has the right to take the property. However, the previous owner may not yet have a new residence. In order to gain possession of the residence, you must go through the process of eviction, which can take around 30 days or more. Here are the typical steps for evicting a former owner after a home has been foreclosed.
1. Deliver a written notice. The previous owner must be made aware that it is no longer legal for him/her to live on the property. The letter is usually delivered by the bank, and must disclose that you are the new owner and they must vacate the property immediately.
2. File an eviction lawsuit. If the previous owner does not vacate the property, you can file suit three days after you’ve delivered the eviction notice.
3. Meet with the judge. The previous owner is given 30 days to respond before it goes to a judge. The previous owner can try to get the case thrown out. In that case, you will no longer be able to evict the owner.
4. Provide evidence of ownership. During the case you must provide proof of ownership over the property. Both sides will be able to state their case, and the judge will decide whether to set an eviction date or grant the previous owner their property back.
5. Full property inspection. If the previous owner is evicted, you are free to get an inspection and take over the property.
While the process can be complicated, help is available. Stephen K. Hachey, a Florida real estate attorney, that can help you navigate this process and make the most of a difficult situation. Contact him at 813-549-0096.
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When you lose your home in foreclosure, the bank takes over the property, but you might be wondering who becomes responsible for property taxes. Many homeowners who go through a foreclosure worry that they are required to continue paying taxes. Those overdue real estate taxes are a problem, but most attorneys agree that the homeowner is not responsible for them. Those taxes are associated with the property itself, not the people who are living in the property. Therefore, if you are no longer tied to the property because of a foreclosure, the unpaid or overdue property taxes are not your problem. Consult an attorney with expertise in foreclosures or real estate law just to double check. However, you should not worry about paying taxes on property you no longer own.
Taxes on any personal property will be your responsibility. However, the tax liability on your property will transfer to the new property owner. So, if someone buys your house at a foreclosure auction, that new buyer will have to assume the tax burden. If your lender is going to hold onto your property for a while, the lender will have to take over the tax payments. As soon as you realize you are going to allow your home to go into foreclosure, you should stop paying your property taxes. If you are planning to strategically default, do not pay any new property taxes. Be careful if you are trying to negotiate a short sale or a deed in lieu of foreclosure. In those cases, your lender might require that your property taxes are paid up and current in order to agree to any kind of deal. Stephen K. Hachey, a Florida real estate attorney, can help you navigate this process. Contact our offices at 813-549-0096.
This article is for general informational purposes only and does not establish an attorney-client relationship. Please contact a licensed attorney in your state of residence. For more information on our services, please visit our website at floridarealestatelawyer.org.
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When a lender brings a foreclosure action against a property owner in Florida, that lawsuit covers anyone and everyone who might also have a claim to the property. If you are living in a home that is being foreclosed on, the bank may include you as a defendant not because you will owe them any money or may be pursued for any damages, but because the bank will want a clean and clear title on the property, and you as a tenant may be a complication for them. The first thing you want to do is make sure you continue paying your rent. You should pay the property owner until the foreclosure is finalized. Once the foreclosure is complete, if you are still living in the property you might be instructed to make rental payments to the court.
Being served or included in a foreclosure lawsuit when you do not even own the property can be frightening and confusing. Do not panic. If you are not sure what you should do, contact a real estate attorney or a lawyer who is experienced in foreclosures. You will not be evicted from the property if you continue making rental payments. There is a law in place to protect tenants during a foreclosure. If you are under a lease agreement, you can finish out your lease. If you are renting outside of a lease agreement, you will have 90 days to find a new place to live. There is no need to panic about the lawsuit. Once you are no longer a tenant on the property, you will be dropped from it and it will remain a legal matter between the property owner and the lender. Stephen K. Hachey, a Florida real estate attorney, can help you navigate this process. Contact our offices at 813-549-0096.
This article is for general informational purposes only and does not establish an attorney-client relationship. Please contact a licensed attorney in your state of residence. For more information on our services, please visit our website at www.floridarealestatelawyer.org/
This post was written by Stephen Hachey. Follow Stephen on Google, Facebook, Twitter & Linkedin.
