Florida is a judicial foreclosure state meaning foreclosure actions must be presented in court and receive court approval. Once in court, homeowners have the right to raise legal defenses to stop Florida foreclosures. Unrepresented homeowners are rarely successful at defending against a foreclosure suit. The chances of a favorable outcome are significantly higher if the homeowner works with a qualified Miami foreclosure defense attorney. Below are some Florida foreclosure defenses commonly used by homeowners and their attorneys.
Lack of Standing
In order to seek a foreclosure, the plaintiff must be the mortgage holder, in other words, the owner of the loan. Since mortgages are typically bought and sold by different lenders and banks throughout the life of the loan, the original promissory note or mortgage documentation may get lost. Consequently, ownership may difficult to prove for plaintiffs that did not originate the loan. The bank or lender must prove standing, meaning they own the loan and therefore have the right to bring the foreclosure lawsuit. A foreclosure action may be dismissed if they fail to prove standing.
Failure to Provide Notice of Default
Prior to starting Florida foreclosures, banks must notify homeowners that they have defaulted on their mortgage. Not only does the notice of default have to describe possible actions to remedy the default, but it must also provide enough time for homeowners to potentially pay their debt. Thus, banks must allow homeowners at least 30 days before initiating the foreclosure lawsuit. If the bank or lender is unable to prove they gave adequate notice of default, the court may rule against them.
Since Florida foreclosures are either approved or denied in courts of equity, judges can use principles of equity (fairness) when deciding cases. The equity branch of law is used in addition to or instead of legal statutes. One equitable defense, Unclean Hands, entails the homeowner showing that the plaintiff engaged in fraudulent transactions or significantly unrighteous or oppressive conduct. The Principle of Unconscionability entails the homeowner showing the mortgage’s terms or the circumstances surrounding the signing of the loan were substantially unfair.
Violation of State and Federal Law
Homeowners can raise powerful Florida foreclosure defenses if their bank or lender violated state or federal laws when handling their mortgage. For instance, a strong defense can be raised if the plaintiff engaged in unfair lending practices resulting in material violations of the Truth in Lending Act (TILA) and the Home Ownership and Equity Protection Act (HOEPA). Other examples include:
- National Housing Act Violation — The plaintiff failed to inform homeowners of the loan counseling options offered by the U.S. Department of Housing and Urban Development (HUD).
- Florida Consumer Collection Practices Act Violation — The plaintiff failed to provide written notice to homeowners each time their mortgage was transferred to another bank or lender within 30 days.
When fighting a foreclosure, it is better not to be alone. Having an experienced Miami foreclosure defense attorney represent you and defend your homeowner rights in court will strengthen the Florida foreclosure defenses you raise.