October 22, 2020
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       Florida Senate - 2010                                    SB 1778
       By Senator Aronberg
       27-00500C-10                                          20101778__
    1                        A bill to be entitled                      
    2         An act relating to mortgage foreclosures; providing a
    3         short title; specifying applicability to homestead
    4         property and certain foreclosure actions; providing
    5         procedural requirements and limitations for
    6         plaintiffs, defendants, and courts in certain
    7         foreclosure actions; requiring an appraisal;
    8         specifying document production requirements;
    9         specifying loan negotiation requirements; providing
   10         criteria for commercial reasonableness of renegotiated
   11         loans; providing for forbearance liens under certain
   12         circumstances; providing lien limitations; providing
   13         for satisfaction of such liens; requiring mediation;
   14         requiring the Supreme Court to determine certain
   15         forms; requiring court clerks to provide forms to pro
   16         se defendants at no charge; providing for future
   17         expiration; creating s. 83.494, F.S.; providing
   18         requirements for landlords following commencement of a
   19         foreclosure action; providing for security deposits
   20         and advance rents to be maintained in interest-earning
   21         accounts; providing for disclosure of the foreclosure
   22         action to prospective tenants; providing an exception
   23         to liability for failure to provide notice; requiring
   24         the purchaser in a foreclosure sale to credit the
   25         tenant for security deposits and advance rents under
   26         certain conditions; creating s. 83.495, F.S.;
   27         providing that a purchaser of residential property in
   28         foreclosure may terminate a tenant’s residential
   29         rental agreement after providing notice to the tenant;
   30         providing notice requirements; specifying the content
   31         of the notice; providing exemptions; authorizing a
   32         tenant to terminate the lease upon receiving notice;
   33         providing for future expiration; providing an
   34         effective date.
   36  Be It Enacted by the Legislature of the State of Florida:
   38         Section 1. Mortgage renegotiation loans.—
   39         (1) TITLE.—This section may be cited as the “Foreclosure
   40  Bill of Rights.”
   41         (2)APPLICABILITY.—This section applies to actions to
   42  foreclose a mortgage on real estate used and owned as a
   43  homestead, as defined in s. 196.012, Florida Statutes, which are
   44  initiated on or after July 1, 2010, or in which a final judgment
   45  has not been rendered as of July 1, 2010.
   46         (3) NOTICE AND DOCUMENTATION.—In any action to foreclose a
   47  mortgage on homestead property, a defendant may invoke the
   48  protections provided under this section by filing and serving a
   49  notice to invoke the Foreclosure Bill of Rights, which includes
   50  a sworn statement that the property in foreclosure is the
   51  defendant’s homestead property.
   52         (a)The form for the notice shall be provided by the
   53  plaintiff to the defendant with the original service of process
   54  for the foreclosure action, together with the summons and
   55  complaint.
   56         (b) After the protections of this section have been invoked
   57  by a defendant, a plaintiff is not entitled to a final judgment
   58  against that defendant until all of the requirements of this
   59  section have been satisfied.
   60         (c) If a default is entered against a defendant, the
   61  defendant is not entitled to the protections of this section
   62  until the default is set aside.
   63         (d) Within 45 days after the filing and service of the
   64  notice, the plaintiff shall provide for a new appraisal of the
   65  property in foreclosure to determine the current market value of
   66  the property.
   67         (e) Within 60 days after filing the notice to invoke, the
   68  plaintiff shall provide to the defendant the results of the
   69  appraisal conducted pursuant to paragraph (d), together with
   70  true copies of all closing documents relating to the mortgage
   71  under foreclosure, including, but not limited to:
   72         1. Any loan application used to determine the defendant’s
   73  creditworthiness.
   74         2. Any settlement statement.
   75         3. The mortgage being foreclosed.
   76         4. Any promissory note related to the mortgage.
   77         5. Any assignments of the mortgage or note.
   78         (f) If any closing document required under paragraph (e) is
   79  not in the actual possession of the plaintiff, the plaintiff
   80  must make reasonable efforts to obtain the document and, if the
   81  documents cannot be obtained, serve an affidavit on the
   82  defendant detailing the efforts made to obtain the document, the
   83  person or entity in whose possession the documents are believed
   84  to be, and the last known address, location, and telephone
   85  number of such person or entity. The plaintiff shall file a
   86  certificate of compliance with the requirements of paragraph (e)
   87  and this paragraph, as applicable.
   88         (g) Within 30 days after the filing and serving of the
   89  certificate of compliance under paragraph (f), the defendant
   90  shall provide to the plaintiff a sworn financial affidavit, a
   91  copy of the defendant’s tax returns for the preceding 3 years,
   92  and a copy of the defendant’s bank statements for the preceding
   93  3 months. Upon motion, the court may issue protective orders as
   94  deemed necessary to protect the privacy rights of the defendant.
   95         (h) By agreement of the parties or with prior court
   96  approval, including by administrative order, service of any
   97  documents under this section may be made in electronic format or
   98  upon such other terms as may be agreed to or ordered in the
   99  interests of justice and judicial economy.
  101         (a)Upon meeting the requirements of subsection (3), as
  102  applicable, the plaintiff shall make a good faith effort to
  103  negotiate a settlement, which shall include efforts to
  104  renegotiate the loan at a principal equivalent to the actual
  105  market value of the property as determined under paragraph
  106  (3)(d). In determining good faith, the court shall consider:
  107         1. Whether a renegotiated loan is commercially reasonable.
  108         2. Whether the plaintiff has made any offer.
  109         3. The reasonableness of any offer made.
  110         4. Any other factor the court deems relevant.
  111         (b) In determining the commercial reasonableness of a
  112  renegotiated loan, the court shall consider:
  113         1. The income, savings, and other assets of the defendants.
  114         2. The reasonableness of the terms of the original loan,
  115  including whether issues of fraud are presented in the
  116  negotiation and closing of the original loan.
  117         3. Whether the loan term can be extended.
  118         4. Whether the interest rate can be reduced.
  119         5. Whether the repayment terms can be changed.
  120         6. The creditworthiness of the defendant, other than as
  121  affected by the foreclosure and any related nonpayments.
  122         (c) If the loan is refinanced with a reduced principal at
  123  the property’s current market value, the plaintiff is entitled
  124  to a forbearance lien on the property for an amount equal to the
  125  difference between the original principal and the new principal.
  126  The forbearance lien may not grant any other right to foreclose
  127  on the property or otherwise collect the moneys other than as
  128  provided in this section.
  129         1. The forbearance lien shall be recorded in the public
  130  records of the county in which the property is located.
  131         2. Upon the first resale, refinance, or transfer by
  132  operation of law or otherwise, the beneficiary of the
  133  forbearance lien is entitled to any proceeds of the resale,
  134  refinance, or transfer in excess of the renegotiated loan
  135  balance to be applied to satisfaction of the lien.
  136         3. Upon any subsequent resale, refinance, or transfer by
  137  operation of law or otherwise, the beneficiary of the
  138  forbearance lien may foreclose the lien.
  139         (5) MEDIATION.—All actions to foreclose a mortgage are
  140  subject to court-ordered mediation pursuant to s. 44.102,
  141  Florida Statutes. The mediation shall be coordinated and
  142  scheduled by the parties at least 60 days after completion of
  143  all other requirements of this section.
  144         (6)FORMS.—
  145         (a)The Supreme Court shall determine the form and content
  146  of all notices, affidavits, certificates, liens, and other forms
  147  required under this section.
  148         (b) The clerks of the circuit courts shall provide all
  149  forms, together with instructions in English and Spanish, to a
  150  pro se defendant seeking assistance in any foreclosure action.
  151  Such forms shall be provided at no cost to the defendant.
  152         (7) EXPIRATION.—This section expires July 1, 2015.
  153         Section 2. Section 83.494, Florida Statutes, is created to
  154  read:
  155         83.494Disclosure of mortgage foreclosure; security
  156  deposits and advance rents.—
  157         (1) After the initial service of a complaint is made on a
  158  landlord in a mortgage foreclosure proceedings commenced against
  159  a residential dwelling unit, the landlord or the landlord’s
  160  agent:
  161         (a)Shall hold the total amount of money deposited or
  162  advanced by a current or prospective tenant as security for
  163  performance of the rental agreement or as advance rent as
  164  provided under s. 83.49(1)(b); and
  165         (b)Must disclose, in writing, the existence of the pending
  166  foreclosure proceedings to a prospective tenant before executing
  167  a rental agreement made during the pendency of the proceeding.
  168  The written disclosure must inform the prospective tenant that
  169  the foreclosure proceedings might affect the right of the tenant
  170  to possess and reside in the leased dwelling unit and that the
  171  landlord is required to hold the tenant’s total amount of
  172  deposit money or advance rent in accordance with s. 83.49(1)(b).
  173  The landlord’s agent is not liable for failure to notify a
  174  prospective tenant of the foreclosure proceeding unless he or
  175  she received notice of the pending proceedings from the
  176  landlord.
  177         (2)If the landlord or the landlord’s agent did not hold
  178  the deposit money or advance rent in accordance with s.
  179  83.49(1)(b) and the property is sold in foreclosure, the
  180  purchaser shall credit the tenant’s account for any deposit
  181  money paid by the tenant, and make claims against the deposit
  182  pursuant to s. 83.49(1)(b). The purchaser shall also credit the
  183  tenant’s account for any advance rent for an unexpired rental
  184  period. The tenant must have documentation demonstrating the
  185  payment of the security deposit or advance rent in order to
  186  receive the credit.
  187         Section 3. Section 83.495, Florida Statutes, is created to
  188  read:
  189         83.495Possession of foreclosed residential dwelling unit;
  190  notice to tenant.—
  191         (1)Upon receipt of a certificate of title issued pursuant
  192  to s. 45.031, a purchaser of a foreclosed residential dwelling
  193  unit occupied by a tenant may terminate the rental agreement
  194  after providing the tenant with written notice stating that the
  195  dwelling unit has been sold and that the purchaser is taking
  196  possession of the property and terminating the agreement.
  197         (a) If the agreement is not in writing, the tenant may
  198  continue to occupy the premises for up to 90 days after the date
  199  the tenant receives notice.
  200         (b) If there is a written rental agreement, the tenant may
  201  continue to occupy the premises until the end of the lease term
  202  or up to 90 days after the date the tenant receives notice,
  203  whichever is greater.
  204         (c) The purchaser of the foreclosed unit must provide such
  205  notice before terminating a lease regardless of whether the
  206  purchaser intends to retain ownership of the premises or sell
  207  the premises to a subsequent purchaser who will occupy the
  208  premises.
  209         (2) Notice under this subsection must be delivered in
  210  accordance with s. 83.56(4) and must be in substantially the
  211  following form:
  213         Dear ...(name of tenant...
  214         You are hereby advised that the premises, ...(address
  215         of rental unit)... you are occupying, has been the
  216         subject of a foreclosure action and that your rental
  217         agreement is terminated effective 90 days after you
  218         receive this termination notice, or, if you have a
  219         written rental agreement, at the end of the term of
  220         your rental agreement or 90 days after you receive
  221         this notice, whichever is later. You must vacate the
  222         premises by that date. You are still obligated to pay
  223         rent in the amount you have been paying prior to this
  224         notice during the remaining term of your written
  225         rental agreement, or during the 90-day period that you
  226         continue to occupy the premises. Rent shall be
  227         delivered to:
  228         ...[name]...
  229         ...[address]....
  231         (3)Notice under this section is not required if:
  232         (a)The mortgager being foreclosed, or the child, spouse,
  233  or parent of the mortgagor being foreclosed, is occupying the
  234  dwelling unit being foreclosed, unless it is a multiunit
  235  property and other tenants are occupying dwelling units;
  236         (b)The rental agreement is not an arms-length transaction;
  237  or
  238         (c)The rental agreement allows rent that is substantially
  239  less than the fair market rent for the premises, unless the rent
  240  is reduced or subsidized due to a federal, state, or local
  241  subsidy.
  242         (4)Upon receipt of the notice, the tenant may terminate
  243  the lease by giving 7 days’ written notice to the purchaser.
  244         (5)This section expires December 31, 2012.
  245         Section 4. This act shall take effect July 1, 2010.

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