What Is a Deficiency Judgment after a Florida Foreclosure?

Florida law leaves the decision to the court. In all suits to foreclose mortgages, entering a deficiency decree for any portion of a deficiency, if one exists, is within the sound discretion of the court.

Owner occupied homes have a cap. For owner occupied residential property, the deficiency may not exceed the difference between the judgment amount, or in a short sale the outstanding debt, and the fair market value of the property on the date of sale. Residential property that received a homestead tax exemption on the latest certified assessment roll before the foreclosure was filed is presumed to be owner occupied, though that presumption can be rebutted.

A separate lawsuit is possible. The foreclosing party also has the right to sue at common law to recover the deficiency, unless the court in the foreclosure action has already granted or denied a claim for a deficiency judgment.

The deadline is short for smaller residential properties. An action to enforce a deficiency claim on a note secured by a mortgage on a one to four family residential dwelling must be brought within 1 year. The period starts on the day after the clerk of court issues the certificate or the day after the mortgagee accepts a deed in lieu of foreclosure.

How the note and mortgage work together is explained in mortgage instruments and promissory notes.