• Florida Deficiency Proceedings: Costs Recoverable Following Foreclosure
  • February 18, 2015 | Authors: Scott Jonathan Kennelly; Janet C. (Jacy) Owens
  • Law Firm: Rogers Towers, P.A. - Jacksonville Office
  • Following a foreclosure sale, a lender may seek to obtain a deficiency judgment against the borrower and guarantors for the difference between the amount of the debt (as listed in the foreclosure judgment) and the value of the property. As part of this effort, a lender may also be able to recover certain costs.

    As a general rule, costs that predate the foreclosure judgment are not recoverable in a deficiency proceeding, absent some sort of fraud or collusion. However, certain costs secured by the terms of the mortgage or note and specifically reserved by the terms of the foreclosure judgment for future determination may be recoverable.

    Florida courts have found that recoverable costs may include a receiver’s fee, clerk’s fee, accounting fee, attorneys’ fees incurred in obtaining the deficiency judgment, and, in some instances, costs incurred by inappropriate bankruptcy filings between the entry of the foreclosure judgment and the foreclosure sale. Moreover, although unpaid real estate taxes that remain delinquent following the foreclosure sale are typically not recoverable as a cost, such amounts may be considered by the court to reduce the setoff that is given for the value of the property when determining the deficiency amount.

    Because what costs are recoverable may vary depending on the terms of the loan documents and the specific circumstances, lenders should be sure to consult with counsel to ensure maximum recovery.