Often times, third-party purchasers seek representation in a foreclosure
case. This normally occurs when a homeowner’s association foreclosed
on a subordinate lien, the property goes to auction, and the property
is sold to a third-party purchaser. Subsequent to the sale, the Bank files
a foreclosure action against the borrowers on the mortgage and names the
third-party purchaser in the lawsuit, since the third-party purchaser
took interest to the property prior to the bank filing a lis-pendens.
As such, the third-party purchaser is an indispensable party.
U.S. Bank Nat’l Ass’n v. Bevans, 138 So.3d 1185, 1188 (Fla. 3rd DCA 2014). What are the rights of a third-party purchaser in the foreclosure
case? Can a third-party purchaser even defend the foreclosure case against
the bank? Many attorneys representing the banks do not think that a third-party
purchaser has the ability to raise
any defenses (such as standing) in a foreclosure case. In fact, the Pealer
case that just came out of the Second DCA in Florida, reaffirmed this
notion and essentially held that that third-party purchasers have no cognizable
interest in the property other than the right of redemption under Fla.
Stat. §45.0315. At any time before the filing of the certificate
of sale, the Pealers “may cure the mortgagor's indebtedness
and prevent a foreclosure sale by paying the amount of moneys specified
in the judgment, order, or decree of foreclosure.” § 45.0315.
Pealer v. Wilmington Trust Nat'l Ass'n for MFRA Trust, 42 Fla. L. Weekly D646 (Fla. 2d DCA Mar. 17, 2017). However, not all
is lost. There are other ways to defend from a third-party’s perspective
that involves various procedural and evidentiary requirements that the
bank must meet regardless of the legal interest of the Defendants. These
include raising failure to state a proper claim for incorrect or omitted
allegations made in the banks complaint, attaching the proper documentation
to their foreclosure complaint, producing the original note, and so on.
It is always best to seek representation if you or someone you know is
a third-party purchaser. Loan Lawyers has helped over 5,000 South Florida
homeowners and consumers with their debt problems.
Please contact us to see how we may be able to help you. In addition, for more information
on foreclosure defense, please visit