Florida Senate - 2025                                    SB 1778
       
       
        
       By Senator Garcia
       
       
       
       
       
       36-01065-25                                           20251778__
    1                        A bill to be entitled                      
    2         An act relating to redemption rights and deeds in lieu
    3         of foreclosure; providing a short title; providing a
    4         legislative purpose; amending s. 45.0315, F.S.;
    5         providing that a defendant, a property owner, or a
    6         holder of a subordinate interest in real property may
    7         cure a defendant’s indebtedness to prevent the sale of
    8         such real property; authorizing the court to enter
    9         orders confirming that the release of the real
   10         property from a satisfied or transferred lien is free
   11         and clear of the satisfied or transferred lien;
   12         providing that the right of redemption by an owner of
   13         real property subject to redemption is not waivable;
   14         providing exceptions; providing that redemption rights
   15         in personal or real property may be waived after
   16         default judgment under certain circumstances;
   17         providing that simple consideration or forbearance
   18         from exercising rights or remedies by the plaintiff is
   19         inadequate consideration; creating s. 45.0316, F.S.;
   20         authorizing the transfer of a lien claimed to encumber
   21         real or personal property by certain persons;
   22         providing the method in which to transfer such a lien
   23         claim; requiring that any excess of the security filed
   24         over the aggregate of such lien claim be repaid to the
   25         party filing the transfer of a lien claim; providing
   26         that such payments are subject to certain provisions
   27         of law regarding deposits of money paid into court;
   28         authorizing a party having an interest in such
   29         security or such property from which the lien was
   30         transferred to file a complaint or a motion in the
   31         circuit court of the county where such security is
   32         deposited seeking specified relief from the court;
   33         requiring the court to increase the cash deposit
   34         amount or lien transfer bond if it finds the funds are
   35         insufficient; providing construction; authorizing the
   36         person that deposited the amount or filed the security
   37         to seek a court order to release the security under
   38         certain circumstances; amending s. 679.612, F.S.;
   39         providing a specified timeframe for reasonable
   40         disposition of dual collateral of mortgaged property
   41         and pledged shares of the entity that owns the
   42         mortgaged property; amending s. 697.02, F.S.;
   43         prohibiting a mortgagee or its designee from acquiring
   44         interest, right to legal title, or right of possession
   45         to a mortgagee’s property; providing exceptions;
   46         amending s. 702.01, F.S.; requiring that properties in
   47         a foreclosed mortgage be sold at a judicial sale;
   48         providing that a right or remedy of strict foreclosure
   49         by contract, forbearance, or other instrument is
   50         unenforceable in this state; providing that a
   51         mortgagee may only acquire title and ownership of the
   52         mortgagor’s property by purchasing it at the judicial
   53         sale or in full or partial satisfaction of specified
   54         obligations; creating s. 702.011, F.S.; providing the
   55         circumstances in which a mortgagee or its designee may
   56         acquire title and ownership to property that is
   57         mortgaged before or after default in full or partial
   58         satisfaction; providing that the transfer or
   59         assignment instrument is unenforceable if such
   60         circumstances do not exist; providing that transfer or
   61         assignment instruments of settlements for certain
   62         pending foreclosure proceedings may be held in escrow
   63         for a certain timeframe for the mortgagor to cure the
   64         amounts owed; providing that the escrow instrument be
   65         marked null and void and returned to the mortgagor and
   66         the foreclosure proceedings move forward or be
   67         dismissed if the mortgagor satisfies the cure amounts;
   68         requiring that notice of default be filed if the cure
   69         amounts are not satisfied; providing the requirements
   70         for notice; requiring that a hearing be held within a
   71         specified timeframe for the court to make specific
   72         determinations; providing that the transfer or
   73         assignment instrument may include contractual terms
   74         that provide specified information; authorizing a
   75         court to enter orders if the instrument of transfer or
   76         assignment complies with specified provisions;
   77         providing that the act is remedial; providing an
   78         effective date.
   79          
   80  Be It Enacted by the Legislature of the State of Florida:
   81  
   82         Section 1. This act may be cited as the “Redemption
   83  Procedures Improvement Act.”
   84         Section 2. The purpose of this act is to:
   85         (1) Provide procedures for redemption to preserve and
   86  protect a property owner’s equity in property and the equity of
   87  junior lienors.
   88         (2) Support and foster loan refinancing with requirements
   89  and procedures for full or partial tender of payment and
   90  transfer of the lien to certain security as substitute
   91  collateral.
   92         (3) Provide requirements and procedures for waiver of
   93  redemption rights and the equity in the property to ensure the
   94  property owner makes an informed decision and to protect the
   95  property owner from overreach or fraud.
   96         (4) Provide requirements and procedures for a mortgagee’s
   97  acceptance of a borrower’s real property in lieu of judicial
   98  foreclosure sale in full or partial satisfaction of an
   99  obligation to ensure the property owner makes an informed
  100  decision and to protect the property owner from overreach or
  101  fraud.
  102         Section 3. Section 45.0315, Florida Statutes, is amended to
  103  read:
  104         45.0315 Right of redemption.—
  105         (1) At any time before the later of the filing of a
  106  certificate of sale pursuant to s. 45.031 or s. 45.0316 by the
  107  clerk of the court or the time specified in the judgment, order,
  108  or decree of foreclosure, the defendant, the property owner,
  109  mortgagor or the holder of any subordinate interest may:
  110         (a) Cure the defendant’s mortgagor’s indebtedness and
  111  prevent a foreclosure sale of the real or personal property by
  112  paying the amount of moneys specified in the judgment, order, or
  113  decree of foreclosure, or if no judgment, order, or decree of
  114  foreclosure has been rendered, by tendering the performance due
  115  under the contract or security agreement, including any amounts
  116  due because of the exercise of a right to accelerate, plus the
  117  reasonable expenses of proceeding to sale foreclosure incurred
  118  to the time of tender, including reasonable attorney attorney’s
  119  fees of the plaintiff or creditor;
  120         (b) Transfer the lien to certain substitute security in
  121  accordance with s. 45.0316; or
  122         (c) Tender partial payment of the redemption amount to the
  123  plaintiff or lien claimant and transfer the lien for the unpaid
  124  redemption amount it secures to substitute security in
  125  accordance with s. 45.0316.
  126  
  127  Otherwise, there is no right of redemption.
  128         (2) For real or personal property redeemed under this
  129  section, including by transfer to substitute security in
  130  accordance with s. 45.0316, the court may enter orders
  131  confirming the release of the real or personal property from the
  132  lien satisfied or transferred and that the property and title to
  133  the property is free and clear of the satisfied or transferred
  134  lien.
  135         (3)The right of redemption by an owner of real or personal
  136  property subject to redemption under subsection (1) is not
  137  waivable, unless:
  138         (a)The waiver is a fully informed and voluntary agreement
  139  of the property owner;
  140         (b)The waiver is a separate instrument containing no
  141  consents, agreements, or disclosures, except the disclosures
  142  required in this subsection;
  143         (c)The waiver is authorized by the owner of the property
  144  in a signed record as defined in s. 679.1021, and if the owner
  145  of the property is an entity and if the property and the income
  146  it generates are substantially all of the assets of the entity
  147  owner, then waiver is other than in the usual and regular course
  148  of business and, notwithstanding s. 605.04074(3), must be
  149  authorized in a signed record as defined in s. 679.1021 by at
  150  least those members or equity owners owning a majority interest
  151  in the property or such greater number of members or equity
  152  owners required under s. 605.04074(1)(b) or (2)(c), s. 607.1202,
  153  or s. 620.1402(2), as applicable to the waiving entity;
  154         (d)The waiver instrument is executed in accordance with
  155  ss. 689.01 and 695.03;
  156         (e)The waiver instrument is completed with no incomplete
  157  sections before approval and signing of the waiver instrument by
  158  the owner of the real or personal property and includes all of
  159  the following:
  160         1. Financial disclosures that specify the assessed value of
  161  the property.
  162         2. A statement that the assessed value may be lower than
  163  the actual value of the property.
  164         3. The fair market value of the property if appraised or
  165  valued within the previous 6 months or a statement that the
  166  property has not been appraised or valued within the previous 6
  167  months.
  168         4. The amount of any debt encumbering the property.
  169         5. The amount of debt owed to the plaintiff or other person
  170  requesting the waiver and the daily interest accruing on such
  171  obligation.
  172         6. The approximate amount of any equity in the property as
  173  of the date of signing.
  174         7. A statement that the property owner does not need an
  175  attorney.
  176         8. A statement that a waiver of redemption rights is a
  177  waiver of legal rights under s. 45.0315 to pay the obligation
  178  and keep its property or for the property to be sold at judicial
  179  sale to the highest bidder for cash or cash consideration.
  180         9. A statement specifying the consideration given for the
  181  waiver of redemption rights; or
  182         (f)The waiver is made only in conjunction with the
  183  transfer or assignment of the property to the mortgagee or the
  184  mortgagee’s designee in accordance with s. 702.011.
  185         (4)Redemption rights in personal property may be waived
  186  after default judgment only in a signed record as that term is
  187  defined in s. 679.1021 and provided the waiver instrument
  188  includes the disclosures required in paragraph (3)(e).
  189         (5)Simple consideration or forbearance from exercising
  190  rights or remedies by the plaintiff is inadequate consideration
  191  to support a waiver of redemption rights under subsection (3) or
  192  subsection (4).
  193         Section 4. Section 45.0316, Florida Statutes, is created to
  194  read:
  195         45.0316 Transfer of liens to substitute security.—
  196         (1)Any lien claimed to encumber real or personal property
  197  to secure payment of an obligation by a defendant or prospective
  198  defendant may be transferred, by any person having an interest
  199  in the property upon which the lien is imposed or the contract
  200  under which the lien is claimed, from such real or personal
  201  property to other security by:
  202         (a) Depositing in the clerk’s office a specified sum of
  203  money; or
  204         (b) Filing in the clerk’s office a bond executed as surety
  205  by a surety insurer licensed to do business in this state, in an
  206  amount equal to the amount required for redemption under s.
  207  45.0315, or the balance thereof after partial tender of the
  208  redemption amount pursuant to s. 45.0315, plus interest thereon
  209  at the contract rate or legal rate for 3 years, whichever is
  210  greater, plus $5,000 or 25 percent of the outstanding redemption
  211  amount, whichever is greater, to be applied to any attorney fees
  212  and court costs that may be taxed in any proceeding to enforce
  213  the lien.
  214         (2) Such deposit or bond must be conditioned to pay any
  215  judgment or decree that may be rendered for the satisfaction of
  216  the lien claimed by the plaintiff or a prospective plaintiff.
  217  Upon making such deposit or filing such bond, the clerk shall
  218  make and record a certificate, which must include a copy of the
  219  deposit or bond showing the transfer of the lien from the real
  220  or personal property to the security, and shall mail a copy
  221  thereof together with a copy of the deposit or bond by
  222  registered or certified mail to the plaintiff or lien claimant
  223  named in the lien record so transferred, at the address stated
  224  therein. Upon filing or recording of the certificate of transfer
  225  in the appropriate office maintaining liens of such type or in
  226  the action, the real or personal property is released from the
  227  lien claimed by the lienholder and such lien is transferred to
  228  the security. The clerk is entitled to a service charge for
  229  making and serving the certificate, in an amount of up to $20,
  230  from which the clerk shall remit $5 to the Department of Revenue
  231  for deposit into the General Revenue Fund.
  232         (3) If the transaction involves the transfer of multiple
  233  liens, the clerk must charge an additional service charge of up
  234  to $10 for each additional lien, from which the clerk shall
  235  remit $2.50 to the Department of Revenue for deposit into the
  236  General Revenue Fund. For recording the certificate and
  237  approving the bond, the clerk shall receive her or his usual
  238  statutory service charges as prescribed in s. 28.24. Any number
  239  of liens may be transferred to one such security.
  240         (4) Any excess of the security over the aggregate amount of
  241  any judgments or decrees rendered plus costs actually taxed
  242  shall be repaid to the party filing the same or her or his
  243  successor in interest. Any deposit of money shall be considered
  244  as paid into court and is subject to the provisions of law
  245  relative to payments of money into court and the disposition of
  246  same.
  247         (5) Any party having an interest in such security or the
  248  property from which the lien was transferred may at any time,
  249  and any number of times, file a complaint in equity in the
  250  circuit court of the county where such security is deposited, or
  251  file a motion in a pending action to enforce a lien, for an
  252  order to require additional security, reduction of security,
  253  change or substitution of sureties, payment of discharge
  254  thereof, or any other matter affecting the security. If the
  255  court finds that the amount of the deposit or bond in excess of
  256  the amount claimed to redeem the lien is insufficient to pay the
  257  lienor’s attorney fees and costs incurred in the action to
  258  enforce the lien, the court shall increase the amount of the
  259  cash deposit or lien transfer bond. This subsection may not be
  260  construed to vest exclusive jurisdiction in the circuit courts
  261  over transfer bond claims for nonpayment of an amount within the
  262  monetary jurisdiction of the county courts.
  263         (6) If it appears that the statute of limitations for
  264  enforcement of the lien has expired or the transferred lien has
  265  been satisfied of record, the person depositing or filing the
  266  security, or the insurer, may seek a court order directing the
  267  clerk to release the security subject to motion, notice to the
  268  lienholder, and a hearing.
  269         Section 5. Section 679.612, Florida Statutes, is amended to
  270  read:
  271         679.612 Timeliness of notification before disposition of
  272  collateral.—
  273         (1) Except as otherwise provided in subsection (2) or
  274  subsection (3), whether a notification is sent within a
  275  reasonable time is a question of fact.
  276         (2) Subject to subsection (1), a notification of
  277  disposition sent after default and 10 days or more before the
  278  earliest time of disposition set forth in the notification is
  279  sent within a reasonable time before the disposition.
  280         (3) For a disposition of shares or membership interests in
  281  an entity pledged to the secured party in addition to the
  282  secured party’s mortgage on real estate of the entity, if the
  283  real property and the income it generates constitutes all or
  284  substantially all of the assets of the entity owner, a
  285  notification of disposition of such pledged assets sent after
  286  default and 120 days or more before the earliest time of
  287  disposition set forth in the notification is sent within a
  288  reasonable time before the disposition.
  289         Section 6. Section 697.02, Florida Statutes, is amended to
  290  read:
  291         697.02 Nature of a mortgage.—A mortgage shall be held to be
  292  a specific lien on the property therein described, and not a
  293  conveyance of the legal title or of the right of possession. A
  294  mortgagee or its designee acquires no interest, right to legal
  295  title, or right of possession to a mortgagee’s property by any
  296  contractual terms, remedies, forbearance, escrowed deed, or
  297  other instrument except by purchase at a judicial sale in
  298  accordance with s. 45.031 or s. 45.0315 or by acquiring title in
  299  accordance with s. 702.011.
  300         Section 7. Section 702.01, Florida Statutes, is amended to
  301  read:
  302         702.01 Equity.—All mortgages shall be foreclosed in an
  303  action in equity and the property sold at a judicial sale in
  304  accordance with s. 45.031 or s. 45.0315. In a mortgage
  305  foreclosure action, the court shall sever for separate trial all
  306  counterclaims against the foreclosing mortgagee. The foreclosure
  307  claim shall, if tried, be tried to the court without a jury. A
  308  right or remedy of strict foreclosure by contract, forbearance,
  309  or other instrument is unenforceable in this state. A mortgagee
  310  may acquire title and ownership of its mortgagor’s property only
  311  by purchase at judicial sale in accordance with s. 45.031 or s.
  312  45.0315 or in full or partial satisfaction of obligations in
  313  compliance with s. 702.011.
  314         Section 8. Section 702.011, Florida Statutes, is created to
  315  read:
  316         702.011 Acceptance of mortgaged property in full or partial
  317  satisfaction of obligation.—
  318         (1)A mortgagee or its designee may acquire title and
  319  ownership to property that is mortgaged before or after default
  320  in full or partial satisfaction of the obligation it secures
  321  only if:
  322         (a)The transfer or assignment is in writing and the
  323  instrument to be signed by the parties to it conspicuously
  324  specifies:
  325         1. That the transfer or assignment instrument is a waiver
  326  of legal rights under s. 45.0315 to pay off the debt and keep
  327  ownership of the property and a waiver of legal rights under s.
  328  45.031 or s. 45.0315 for the property to be sold at judicial
  329  sale to the highest bidder for cash or cash consideration to pay
  330  the obligations secured by the property;
  331         2. A description of the property that is the subject of
  332  transfer to the mortgagee or its designee;
  333         3. The assessed value of the property;
  334         4. That a statement of the assessed value of the property
  335  may be lower than the actual value of the property;
  336         5. The fair market value of the property, if appraised or
  337  valued within the previous 6 months by the mortgagee or its
  338  designee, or a statement by the mortgagee or its designee that
  339  the property has not been appraised or valued within the
  340  previous 6 months;
  341         6. The amount owed to the mortgagee which is secured by the
  342  property and the amount of interest accruing each day;
  343         7. The amount of outstanding ad valorem taxes and other
  344  obligations senior to the mortgagee’s lien which encumber the
  345  property;
  346         8. The approximate amount of equity in the property as of
  347  the signing date by the obligor and property owner;
  348         9. The date by which possession and access to the property
  349  by the mortgagor must be turned over to the mortgagee or its
  350  designee no later than 120 days; and
  351         10. A statement specifying the consideration given by the
  352  mortgagee for the transfer of the property with a statement
  353  specifying whether the transfer is in full or partial
  354  satisfaction of the obligations owed by the obligor which are
  355  secured in whole or part by the property, and if a partial
  356  satisfaction, the amount that will be owed by the obligor after
  357  credit for the property acquired by the mortgagee or its
  358  designee.
  359         (b) The obligor and property owner are fully informed in
  360  writing of the financial disclosures and requirements in
  361  paragraph (a) at least 10 days before the instrument is signed.
  362         (c) The transfer of the mortgaged property to the mortgagee
  363  or the mortgagee’s designee is the voluntary agreement of the
  364  obligor and property owner and:
  365         1. Is authorized by the owner of the property in a signed
  366  record as defined in s. 679.1021(1), and if the owner of the
  367  property is an entity and if the property and the income it
  368  generates are substantially all of the assets of the entity
  369  owner, then the transfer is other than in the usual and regular
  370  course of business, and notwithstanding s. 605.04074(3), the
  371  transfer must be authorized in a signed record as defined in s.
  372  679.1021 by at least those members or equity owners owning a
  373  majority interest of the property owner or such greater number
  374  of members or equity owners required under s. 605.04074(1)(b) or
  375  (2)(c), s. 607.1202, or s. 620.1402(2), as applicable to the
  376  transferring entity; and
  377         2. The instrument is executed in accordance with ss. 689.02
  378  and 695.03.
  379         (d) The transfer or assignment of the property from the
  380  obligor to the mortgagee or the mortgagee’s designee is
  381  contemporaneous with full or partial satisfaction agreed by the
  382  parties in the signed transfer or assignment instrument.
  383  
  384  Otherwise, the transfer or assignment instrument is
  385  unenforceable and the mortgagee must commence judicial
  386  foreclosure proceedings to enforce its lien against the property
  387  for the obligations it secures.
  388         (2) Subject to the disclosures and requirements in
  389  paragraphs (1)(a), (b), and (c), settlement of a pending
  390  foreclosure proceeding may include a transfer or assignment
  391  instrument to be held in escrow for up to 120 days pending
  392  specified cure actions by the mortgagor. If the cure amounts are
  393  satisfied, the escrowed instrument must be marked null and void
  394  and returned to the mortgagor, and the foreclosure proceeding
  395  shall proceed or be dismissed as the parties agreed. If the cure
  396  actions are not satisfied, notice of default must be filed,
  397  served on counsels of record, and mailed to the borrower’s and
  398  any obligor’s last known address as shown by the records of the
  399  mortgagee and, if an e-mail address has been provided, e-mailed
  400  to the last address on record. After a hearing on at least 10
  401  days’ notice, the court will determine the enforceability of the
  402  parties’ agreement, the enforcement of the terms, a deadline for
  403  recording of the escrowed instrument of transfer or assignment,
  404  and a deadline for redemption.
  405         (3) The transfer or assignment instrument authorized under
  406  this section may include contractual terms that provide:
  407         (a) The priority of the lien is unchanged and remains in
  408  full force and effect against and to foreclosure subordinate
  409  interests;
  410         (b) The note, mortgage, or other obligations remain in full
  411  force and effect to foreclose subordinate interests without
  412  recourse to the mortgagor for the obligations satisfied in full
  413  or part;
  414         (c) Title and interest of the grantee in the property will
  415  not merge with any lien or security in the property created
  416  under the mortgage or other instrument; and
  417         (d) Such additional terms reasonably required for the
  418  issuance of title insurance for the property acquired by the
  419  instrument free and clear of the rights or interests of the
  420  mortgagor.
  421         (4) Provided the instrument of transfer or assignment
  422  complies with this section, a court may enter orders confirming
  423  the validity and finality of the transfer or assignment and the
  424  transfer of title to the property to the mortgagee or
  425  mortgagee’s designee without the necessity of any further
  426  proceedings or instruments.
  427         Section 9. The Legislature finds that this act is remedial
  428  in nature and applies to all mortgages encumbering real
  429  property, all promissory notes secured by a mortgage, and all
  430  amendments, supplements, and forbearance agreements in
  431  connection therewith, whether executed before, on, or after the
  432  effective date of this act; however, s. 702.02, Florida
  433  Statutes, as created by this act, applies to instruments of
  434  transfer and assignment made after the effective date of this
  435  act; s. 702.02(2), Florida Statutes, as created by this act,
  436  applies to settlements of pending foreclosure cases signed and
  437  delivered after the effective date of this act; and the
  438  amendments to s. 679.612, Florida Statutes, apply to
  439  dispositions notice or consummated after the effective date of
  440  this act.
  441         Section 10. This act shall take effect July 1, 2025.