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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to legal instruments; amending s. 2
117.201, F.S.; defining the term "witness"; amending 3
s. 697.07, F.S.; defining the terms "mortgagee" and 4
"mortgagor"; requiring that a lien created by an 5
assignment of rents be perfected against a mortgagor 6
in addition to third parties under certain conditions; 7
making technical changes; revising the types of 8
expenses that may be paid by collected rents under 9
certain circumstances; providing applicability; 10
amending s. 702.036, F.S.; defining the term 11
"property"; expanding the scope of a final judgment of 12
foreclosure to include other liens; requiring the 13
award of attorney fees in certain circumstances; 14
amending s. 702.10, F.S.; revising the class of 15
persons authorized to move for expedited foreclosure; 16
making conforming changes; defining the term 17
"mortgagor"; providing for retroactive applicability; 18
providing an effective date. 19
20
Be It Enacted by the Legislatu re of the State of Florida: 21
22
Section 1. Subsection (16) is added to section 117.201, 23
Florida Statutes, to read: 24
117.201 Definitions. —As used in this part, the term: 25
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(16) "Witness," when used as a noun, means an individual 26
whose electronic signature is affixed to an electronic record as 27
an attesting or subscribing witness. 28
Section 2. Subsections (1) through (8) of section 697.07, 29
Florida Statutes, are renumbered as subsections (2) through (9), 30
respectively, present subsections (2), (3), and (4) a re amended, 31
and new subsections (1) and (10) are added to that section, to 32
read: 33
697.07 Assignment of rents. — 34
(1) For purposes of this section, the term: 35
(a) "Mortgagee" means any party entitled to enforce the 36
mortgage or assignment of rents instrume nt under applicable law. 37
(b) "Mortgagor" means the original mortgagor and all 38
parties who have subsequently acquired title to the property 39
subject to the assignment. 40
(3)(2) If such an assignment is made, the mortgagee shall 41
hold a lien on the rents, an d the lien created by the assignment 42
shall be perfected and effective against the mortgagor and third 43
parties upon recordation of the mortgage or separate instrument 44
in the public records of the county in which the real property 45
is located, according to la w. 46
(4)(3) Unless otherwise agreed to in writing by the 47
mortgagee and mortgagor, the lien created by the assignment of 48
rents shall be enforceable upon the mortgagor's default and 49
written demand for the rents made by the mortgagee to the 50
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
mortgagor, whereupon the mortgagor shall turn over all rents in 51
the possession or control of the mortgagor at the time of the 52
written demand or collected thereafter (the "collected rents") 53
to the mortgagee less payment of any expenses authorized by the 54
mortgagee in writing. 55
(5)(4) Upon application by the mortgagee or mortgagor, in 56
a foreclosure action, and notwithstanding any asserted defenses 57
or counterclaims of the mortgagor, a court of competent 58
jurisdiction, pending final adjudication of any action, may 59
require the mortgagor to deposit the collected rents into the 60
registry of the court, or in such other depository as the court 61
may designate. However, the court may authorize the use of the 62
collected rents, before deposit into the registry of the court 63
or other depository, to: 64
(a) Pay the reasonable expenses solely to protect, 65
preserve, and operate the real property, including, without 66
limitation, real estate taxes , and insurance, and assessments 67
that come due after the entry of the court's order to a 68
homeowners' association or association, as defined in s. 69
720.301, or a corporation regulated under chapter 718 or chapter 70
719; 71
(b) Escrow sums required by the mortgagee or separate 72
assignment of rents instrument; and 73
(c) Make payments to the mortgagee. 74
75
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
The court shall require the mortgagor to account to the court 76
and the mortgagee for the receipt and use of the collected rents 77
and may also impose other conditions on the mortgagor's use of 78
the collected rents. 79
(10) This section does not apply to a corporation that is 80
a homeowners' association or association, as defined in s. 81
720.301, or a corporation regulated under chapter 718 or chapter 82
719, that: 83
(a) Acquires title to a parcel or unit through the 84
foreclosure of its claim of lien, or a deed in lieu of 85
foreclosure, provided that title remains vested in the 86
association or corporation and any rents collected are applied 87
to assessments that are then due; or 88
(b) Collects rents from tenants in a parcel or unit 89
pursuant to s. 718.116(11), s. 719.108(10), or s. 720.3085(8) . 90
Section 3. Subsections (1) through (3) of section 702.036, 91
Florida Statutes, are renumbered as subsections (2) through (4), 92
respectively, paragraph (a) of present subsection (1) and 93
present subsection (2) are amended, and new subsections (1) and 94
(5) are added to that section, to read: 95
702.036 Finality of mortgage foreclosure judgment. — 96
(1) As used in this section, the term "property" means 97
real property. 98
(2)(1)(a) In any action or proceeding in which a party 99
seeks to set aside, invalidate, or ch allenge the validity of a 100
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final judgment of foreclosure of a mortgage or other lien, or to 101
establish or reestablish a lien or encumbrance on the property 102
in abrogation of the final judgment of foreclosure of a mortgage 103
or other lien, the court shall treat such request solely as a 104
claim for monetary damages and may not grant relief that 105
adversely affects the quality or character of the title to the 106
property, if: 107
1. The party seeking relief from the final judgment of 108
foreclosure of the mortgage or lien was properly served in the 109
foreclosure lawsuit as provided in chapter 48 or chapter 49. 110
2. The final judgment of foreclosure of the mortgage or 111
lien was entered as to the property. 112
3. All applicable appeals periods have run as to the final 113
judgment of foreclosure of the mortgage or lien with no appeals 114
having been taken or any appeals having been finally resolved. 115
4. The property has been acquired for value, by a person 116
not affiliated with the foreclosing mortgageholder, the 117
foreclosing lienholder, lender or the foreclosed owner, at a 118
time in which no lis pendens regarding the suit to set aside, 119
invalidate, or challenge the foreclosure appears in the official 120
records of the county where the property was located. 121
(3)(2) For purposes of this section, the f ollowing, 122
without limitation, shall be considered persons affiliated with 123
the foreclosing lender: 124
(a) The foreclosing mortgageholder, the foreclosing 125
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lienholder, lender or any loan servicer for the mortgage or lien 126
loan being foreclosed; 127
(b) Any past or present owner or holder of the mortgage or 128
lien loan being foreclosed; 129
(c) Any maintenance company, holding company, foreclosure 130
services company, or law firm under contract to any entity 131
listed in paragraph (a), paragraph (b), or this paragraph, with 132
regard to the mortgage or lien loan being foreclosed; or 133
(d) Any parent entity, subsidiary, or other person who 134
directly, or indirectly through one or more intermediaries, 135
controls or is controlled by, or is under common control with, 136
any entity listed in paragraph (a), paragraph (b), or paragraph 137
(c). 138
(5) If a party seeks relief from a final judgment 139
foreclosing a mortgage or lien, or files a separate action 140
attacking such a final judgement, and the party claims that it 141
holds or held a lien superior in right, priority, or dignity to 142
the mortgage or lien foreclosed in the judgment, the court must 143
award reasonable attorney fees to the party prevailing on the 144
claim. This subsection applies whether the litigation seeking 145
relief from the final judgment occur s in the case in which the 146
judgment was entered or in any separate case or proceeding. 147
Section 4. Subsection (2) of section 702.10, Florida 148
Statutes, is amended to read: 149
702.10 Order to show cause; entry of final judgment of 150
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foreclosure; payment duri ng foreclosure.— 151
(2) Except as provided in paragraph (i), in any action for 152
foreclosure, other than owner-occupied residential real estate, 153
in addition to any other relief that the court may award, the 154
plaintiff may request that the court enter an order directing 155
the mortgagor defendant to show cause why an order to make 156
payments during the pendency of the foreclosure proceedings or 157
an order to vacate the premises should not be entered. 158
(a) The order shall: 159
1. Set the date and time for hearing on the order to show 160
cause. However, the date for the hearing may not be set sooner 161
than 20 days after the service of the order. If service is 162
obtained by publication, the date for the hearing may not be set 163
sooner than 30 days after the first publication. 164
2. Direct the time within which service of the order to 165
show cause and the complaint shall be made upon the mortgagor 166
each defendant. 167
3. State that the mortgagor a defendant has the right to 168
file affidavits or other papers at the time of the hearing and 169
may appear personally or by way of an attorney at the hearing. 170
4. State that, if the mortgagor a defendant fails to 171
appear at the hearing to sh ow cause and fails to file defenses 172
by a motion or by a verified or sworn answer, the mortgagor 173
defendant is deemed to have waived the right to a hearing and in 174
such case the court may enter an order to make payment or vacate 175
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
the premises. 176
5. Require the movant to serve a copy of the order to show 177
cause on the mortgagor defendant in the following manner: 178
a. If the mortgagor a defendant has been served with the 179
complaint and original process, service of the order may be made 180
in the manner provided in the Florida Rules of Civil Procedure. 181
b. If the mortgagor a defendant has not been served with 182
the complaint and original process, the order to show cause, 183
together with the summons and a copy of the complaint, shall be 184
served on the mortgagor defendant in the same manner as provided 185
by law for original process. 186
(b) The right of the mortgagor a defendant to be heard at 187
the hearing to show cause is waived if the mortgagor defendant, 188
after being served as provided by law with an order to show 189
cause, engages in conduct that clearly shows that the mortgagor 190
defendant has relinquished the right to be heard on that order. 191
The mortgagor's A defendant's failure to file defenses by a 192
motion or by a sworn or verified answer or to appear at the 193
hearing duly scheduled on the order to show cause presumptively 194
constitutes conduct that clearly shows that the mortgagor 195
defendant has relinquished the right to be heard. 196
(c) If the court finds that the mortgagor a defendant has 197
waived the right to be heard as provided in paragraph (b), the 198
court may promptly enter an order requiring payment in the 199
amount provided in paragraph (f) or an order to vacate. 200
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(d) If the court finds that the mortgagor has not waived 201
the right to be heard on the order to show cause, t he court 202
shall, at the hearing on the order to show cause, consider the 203
affidavits and other showings made by the parties appearing and 204
make a determination of the probable validity of the underlying 205
claim alleged against the mortgagor and the mortgagor's 206
defenses. If the court determines that the plaintiff is likely 207
to prevail in the foreclosure action, the court shall enter an 208
order requiring the mortgagor to make the payment described in 209
paragraph (e) to the plaintiff and provide for a remedy as 210
described in paragraph (f). However, the order shall be stayed 211
pending final adjudication of the claims of the parties if the 212
mortgagor files with the court a written undertaking executed by 213
a surety approved by the court in an amount equal to the unpaid 214
balance of the lien being foreclosed, including all principal, 215
interest, unpaid taxes, and insurance premiums paid by the 216
plaintiff. 217
(e) If the court enters an order requiring the mortgagor 218
to make payments to the plaintiff, payments shall be payable at 219
such intervals and in such amounts provided for in the mortgage 220
instrument before acceleration or maturity. The obligation to 221
make payments pursuant to any order entered under this 222
subsection shall commence from the date of the motion filed 223
under this section. The order shall be served upon the mortgagor 224
no later than 20 days before the date specified for the first 225
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payment. The order may permit, but may not require, the 226
plaintiff to take all appropriate steps to secure the premises 227
during the pendency of the foreclo sure action. 228
(f) If the court enters an order requiring payments, the 229
order shall also provide that the plaintiff is entitled to 230
possession of the premises upon the failure of the mortgagor to 231
make the payment required in the order unless at the hearing on 232
the order to show cause the court finds good cause to order some 233
other method of enforcement of its order. 234
(g) All amounts paid pursuant to this section shall be 235
credited against the mortgage obligation in accordance with the 236
terms of the loan documen ts; however, payments made under this 237
section do not constitute a cure of any default or a waiver or 238
any other defense to the mortgage foreclosure action. 239
(h) Upon the filing of an affidavit with the clerk that 240
the premises have not been vacated pursuant to the court order, 241
the clerk shall issue to the sheriff a writ for possession which 242
shall be governed by s. 83.62. 243
(i) This subsection does not apply to foreclosure of an 244
owner-occupied residence. For purposes of this paragraph, there 245
is a rebuttable presumption that a residential property for 246
which a homestead exemption for taxation was granted according 247
to the certified rolls of the latest assessment by the county 248
property appraiser, before the filing of the foreclosure action, 249
is an owner-occupied residential property. 250
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(j) For purposes of this subsection, the term "mortgagor" 251
means the original mortgagor and any subsequent owner or party 252
in possession of the property. The term does not include a 253
homeowners' association or association, as defined in s. 254
720.301, or a corporation regulated under chapter 718 or chapter 255
719, that: 256
1. Acquires title to a parcel or unit through the 257
foreclosure of its claim of lien, or a deed in lieu of 258
foreclosure, provided that title remains vested in the 259
association or corporation and any rents collected are applied 260
to assessments that are then due; or 261
2. Collects rents from the tenants in the parcel or unit 262
pursuant to s. 718.116(11), s. 719.108(10), or s. 720.3085(8). 263
Section 5. The amendment to s. 117.201, Flori da Statutes, 264
in this act is intended to clarify existing law and applies 265
retroactively to January 1, 2020. 266
Section 6. This act shall take effect July 1, 2023. 267