Florida Senate - 2014 SB 82 By Senator Soto 14-00027-14 201482__ 1 A bill to be entitled 2 An act relating to short sale debt relief; creating 3 the “Short Sale Debt Relief Act”; defining terms; 4 providing that a debtor does not owe a deficiency to a 5 lienholder related to an eligible real property sold 6 pursuant to a bona fide short sale if an offer is 7 received by the debtor within a specified time period 8 and under specified conditions; providing for the 9 distribution of proceeds; requiring a lienholder to 10 approve the short sale of property and execute any 11 document necessary to close the sale within a 12 specified time period if a debtor procures a buyer who 13 makes an offer in writing equal to the fair market 14 value of the eligible property; providing that a 15 debtor has a claim against a lienholder for actual 16 damages, costs, elimination of the lien, and attorney 17 fees if the lienholder violates the act; providing an 18 effective date. 19 20 Be It Enacted by the Legislature of the State of Florida: 21 22 Section 1. (1) This act may be cited as the “Short Sale 23 Debt Relief Act.” 24 (2) As used in this act, the term: 25 (a) “Bona fide short sale” means a sale of eligible real 26 property which is the result of an arms-length transaction 27 between two parties who are unrelated by family or contractual 28 ties other than the short sale. 29 (b) “Deficiency” means a debt owed related to a mortgage, 30 note, or other lien on eligible real property which exceeds any 31 money received by a lienholder pursuant to a bona fide short 32 sale. 33 (c) “Eligible real property” means any first home, second 34 home, or single-family rental property located in this state 35 which has total mortgage-related debt greater than 20 percent of 36 the fair market value of the property as determined by a 37 licensed appraiser. 38 (d) “Proceeds” means an amount equal to the purchase price 39 of a bona fide short sale less any applicable fees and taxes; 40 however, new fees may not be created by a lienholder as a result 41 of this act. 42 (e) “Short sale” means the purchase and sale of real 43 property in which all of the following apply: 44 1. The grantor’s interest is encumbered by one or more 45 mortgages securing indebtedness in an aggregate amount greater 46 than the consideration paid or given by the grantee. 47 2. A mortgagee releases the real property from its mortgage 48 in exchange for a payment of less than the total of the 49 outstanding mortgage indebtedness owed to the releasing 50 mortgagee. 51 3. The releasing mortgagee does not receive, directly or 52 indirectly, any interest in the property transferred. 53 4. The releasing mortgagee is not controlled by or related 54 to the grantor or the grantee. 55 (3) A debtor does not owe a deficiency to a lienholder 56 related to eligible real property sold pursuant to a bona fide 57 short sale if an offer is received by a debtor pursuant to 58 subsection (5) within 3 years after July 1, 2014, and closing 59 occurs within 60 days thereafter. 60 (4)(a) A first lienholder is entitled to 90 percent of the 61 proceeds of the short sale. 62 (b) A second or subsequent lienholder is entitled to a 63 combined total of 10 percent of the proceeds of the short sale, 64 which must be distributed proportionally to the amount of debt 65 held by the second or subsequent lienholder. 66 (5) If a debtor procures a buyer who makes an offer in 67 writing equal to the fair market value of the eligible property 68 for a bona fide short sale, the lienholder shall approve the 69 sale of the property and execute any document necessary to close 70 the sale within 45 days after the sale. 71 (6) A debtor may file a claim against a lienholder for 72 actual damages, costs, elimination of the lien under equity, and 73 attorney fees if the lienholder violates this act. 74 Section 2. This act shall take effect July 1, 2014.