What to Do When Served with Foreclosure: A Step by Step Guide

Step by Step Guide after service of foreclosure.

For Associations who have not been brought into the current foreclosure crisis, and even for those who have, the service of a bank foreclosure Complaint, (the document that starts a foreclosure action in Court) can be a troubling, scary and confusing event. Usually the foreclosing party will serve the registered agent of the Association as listed on Sunbiz.org. Occasionally, the foreclosing party will serve members of the board of directors, their family members, the Association’s attorney, non-homeowners, mail men and the occasional doormat.


Service by any person other than the registered agent of the Association should generally not be accepted. There are strategic exceptions to this which are outside the scope of this article.


So your Association has been served:


Step 1: After confirming that you have indeed received a foreclosure complaint, the process-server is supposed to advise you what they are handing to you, immediately fax and if possible email the complaint to your attorney/legal adviser.


Step 2: Always follow-up with a call to your attorney/legal adviser to confirm receipt of the Complaint. The reason for this follow-up call is two-fold.


First, it is imperative that the Complaint be received and reviewed as soon after service as possible. Florida has a 20 day time frame for answering foreclosure Complaints. If a responsive document or extension is not done within that time frame, the bank may default the Association. This can result in the Association not being able to request the maximum amount of delinquent assessments at the end of the foreclosure. Additionally, the Association will be unable to move forward with motions to compel or motions to dismiss should the foreclosure stall.


Second, you can then discuss the strategy on how to respond to the foreclosure. There are many different reasons to avoid filing a simple answer to complaint.


For Example: Is the Association foreclosing itself? If so perhaps it would be more favorable to Association to make the bank prove its foreclosure by aggressively responding to the Complaint.


Is the bank attempting to overstep the provisions of Florida Statute 720.3085 or 718.116? If so, a simple answer may trap the Association into a certain recovery at the end of the foreclosure.


Step 3: Schedule a follow-up for 20 days from the date of the foreclosure to confirm that action has been taken.


If valid service occurred on August 31, 2011. The Association has until September 20, 2011 to respond. The date of service does not count. Weekends do.


Step 4: Expect and request monthly updates regarding the status of the foreclosure.


Foreclosure actions have taken several years to conclude given the volume and skill with which they are being worked by the bank. If a short sale or bankruptcy comes into play, years spent waiting can cause serious difficulty for the Association. If more than 3 months pass without significant progress, consider inquiring whether a motion to compel or call to the bank is appropriate.


To read more about our firm’s legal services, including Association Foreclosures, please visit Association Assessment Attorneys, P.A. main website.