Covered properties include residential real property of one to four family units where at least one of the units is occupied by the owner in foreclosure. Any property over four units is considered a commercial property and exempt from this legislation whether the owner lives there or not. The owner must be the "title owner" in the public records to fall under the benefit of the statute.

A very common technique used by investors to acquire foreclosure properties is to reinstate the delinquent loan amount and continuing making monthly mortgage payments on the homeowner's original mortgage. The new legislation forbids this type of transaction and any outstanding loans must be paid at the time of the title transfer. This was designed to protect the homeowner from the mortgage payments stopping and his having no recourse to reinstate the loan or make payments that wouldn't benefit him since he was no longer the owner of the property.

This is a brief overview of the second part of Florida Statute 501.1377 (HB 643/SB 992) and is for educational purposes only and not meant to be legal opinion or advice.

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