Alternatives to Foreclosure in Florida
Do You Have Options to Avoid Foreclosure in Florida?
If you acquired your home under a mortgage agreement, it’s because you hoped to pay it off as and when due. Unfortunately, life happens, and unforeseen circumstances may make you incapable of living up to your mortgage obligations. After missing your payments or receiving a notice of default, the fear of losing your precious home starts staring you in the face. The only question on your mind at this point is, “Are there any alternatives to foreclosure in Florida?”
Fortunately, the answer is a big YES. Florida's foreclosure law offers you numerous avenues to avoid losing your home. The best method to apply depends on the unique circumstances of your case.
Even in the worst-case scenarios, you can give up your property without suffering the harsh consequences that foreclosure brings.
In this article, you’ll learn about the different ways to prevent your Florida home from a foreclosure sale. You’ll also discover how a real estate attorney can help in selecting alternatives to foreclosure in Florida. First things first . . . we’ll begin with a summary of what Florida’s foreclosure process entails.
What’s The Foreclosure Process in Florida?
A Foreclosure Lawsuit Begins with A Complaint and May End With an Eviction
Foreclosure in Florida begins when you’re served with a summons and complaint, which you have to respond to within 20 days of receipt. If you don’t respond, a default judgment may be entered against you and the case may move to trial, where the court will rule in your or the lender’s favor. A foreclosure sale could be scheduled soon after a judgment is entered.
Note that Florida’s foreclosure process affords you numerous enforceable rights. They include the right to redeem your property within 10 days after the foreclosure sale, apply for loss mitigation, and receive a pre-foreclosure breach letter and a notice of foreclosure.
What Are The Options to Avoid Foreclosure in Florida?
There Are Numerous Ways to Protect Your Home from Getting Foreclosed When You Act Fast
You have two choices when your home is under a foreclosure threat — give up or fight to keep it. Regardless of what you choose, you can achieve your desires without having to go through with foreclosure.
The following foreclosure alternatives in Florida may help:
Short Sale
A short sale is one of the foreclosure alternatives to consider when you’re sure you can no longer continue with your mortgage. With this option, you and the lender will agree to sell your home below what you owe. The lender may also agree not to pursue the deficiency after receiving the proceeds of the short sale.
“Deficiency” refers to the difference between the sale proceeds and the outstanding balance on your loan. While short sales can make the mortgagee lose some money, they often consider this loss mitigation strategy for some benefits it offers. For example, it’s a much faster and affordable alternative to recovering a substantial part of the debt compared to foreclosure.
Loan Modifications
You can protect your home without succumbing to foreclosure by agreeing with the lender to modify the mortgage terms. In a loan modification, you’re informing the lender that you intend to keep your home, but the mortgage obligations are above your capacity. So, they would alter the terms of the agreement to make it more manageable and in line with your current realities.
For example, your lender may agree to lower your interest rates to make the mortgage more affordable for you. They may also reduce your principal balance, increase the duration of your loan, or eliminate late fees.
Deed-in-Lieu of Foreclosure
A deed-in-lieu of foreclosure is another way to give up your home without facing the harsh effects of foreclosure. Under this arrangement, you would transfer the title of your property back to the lender to release yourself from the mortgage obligations.
This is usually a last resort after exhausting other methods to keep your home. As with a short sale, mortgagees may agree to a deed-in-lieu of foreclosure to avoid the cost implications and lengthiness of a foreclosure lawsuit.
Forbearance Agreements
A forbearance agreement is an arrangement between lender and mortgagor to pause or reduce mortgage payments temporarily. Not only does this place less financial burden on you, but it also stops the mortgagee from commencing foreclosure proceedings against you.
Usually, lenders agree to a forbearance arrangement after you’ve proven that you’re in a financial crisis. You’d only have to pay back your arrears when the forbearance period ends.
Refinancing
When you refinance your mortgage, you’re replacing your existing mortgage with a new and more favorable loan. This approach can save you from foreclosure by changing your payment schedule, switching your mortgage from fixed-rate to adjustable-rate, etc.
Generally, lenders are opposed to refinancing an underwater mortgage because they require significant home equity to secure their interests. However, you may take advantage of some programs that allow you to refinance your home even with negative home equity.
Examples include Fannie Mae’s HIRO (High LTV Refinance Option) and ERR (Enhanced Relief Refinance) programs.
Foreclosure Defenses
One of the most effective ways to keep your home when faced with foreclosure is to defend yourself against it. This approach is quite different from the above alternatives because it doesn’t try to work around foreclosure. Instead, it challenges the legality of the attempt to foreclose on your property in the first place.
For example, you may fight against foreclosure by proving that the statute of limitations on the foreclosure claim has expired. Other common defenses to foreclosure include fraud, laches, and failure to give notice.
If you’ve examined your situation and concluded that you cannot keep up with your mortgage obligations, you should still take steps to avoid foreclosure. This is because foreclosure will remain on your credit report for many years, thereby hurting your credit score. It may also limit your chances of future employment, especially in a financial institution.
What Are The Essential Questions to Ask My Foreclosure Defense Attorney During An Initial Consultation?
Questions Are Essential to Understanding Your Attorney’s Capabilities and What to Expect in Your Case
You should be confident enough to ask your lawyer any questions bothering you, regardless of how insignificant you think they are. However, the essential information to obtain before hiring a lawyer revolves around their capacity to handle your case, fees, and obligations. So, questions like, “How much experience do you have?” “What documents should I bring?” “How do you charge?” are always welcome.
Consult A Competent Florida Foreclosure Defense Lawyer ASAP!
Our Foreclosure Defense Attorneys in Florida Are Always Happy to Help
It’s not enough to know that there are alternatives to foreclosure in Florida. To make these alternatives work for you, you need to know the most suitable ones for your case. More than just that, you must also understand how to apply them against Florida’s peculiar legal landscape. That’s where Attorney Carlos M. Amor comes in.
As a foreclosure defense lawyer with over 15 years of practice experience, Carlos M. Amor understands the nitty-gritty of your case. He’s well-respected in the legal community for his tenacity and excellent track record of successful foreclosure defense cases.
Attorney Carlos M. Amor is a compassionate lawyer who wants nothing more than to see you enjoy permanent possession of your property. With him, you may have an increased chance of fighting foreclosure and keeping your home.
Contact him today at 954-453-7200 to schedule a free case review via a phone call, video meeting, or one-on-one.
ATTORNEY CARLOS M. AMOR
Carlos M. Amor is a skilled and experienced attorney and real estate broker. His legal practice in South Florida focuses on real estate litigation, real estate investments, tax deed and foreclosure auction purchases, traditional real estate transactions, short sales, foreclosure defense, and civil litigation. Carlos thinks “outside the box” and takes a practical approach to finding solutions that benefit his clients. [ Attorney Bio ]