Liens After Forclosure

11 Replies

I am bidding on an auction in Miami Dade and Broward County Florida.

I know if the bank owns the house, but it is vacant then the unpaid HOA fees will be paid by the bank. If the house is occupied, but the bank still owns it I will have to pay the unpaid HOAs. (I know this from my own experience)

What else survives foreclosure?? HOA and tax liens, and what else?? (if the bank is the owner I assume it has always been foreclosed)

I have been buying estoppel letters and title searches. I am wondering how can I void this??


Whether a house is occupied, or not, has No bearing on the new owner being responsible for the outstanding HOA debt. Not sure what situation makes you think that?

I assume you are Not talking about the county (courthouse steps) foreclosure auctions, as the banks don't own these yet.

The actual, individual auction terms for REO's being auctioned by, hubzu, etc. will determine who pays any outstanding HOA debts, and it varies from property to property within the same auction.

As @Wayne Brooks  points out, there is no bearing on whether the property is occupied or not, it does not matter to the bank. As HOA Liens survive the foreclosure process in Florida, they will still be in place after the auction. Typically, the banks do not pay these off in advance of the auction or afterwards, so are the new owner's responsibility.

As for other liens that survive, these can be:

  • IRS-under special circumstances (under 120 day redemption period from deed recording). If IRS does not exercise its redemption right within the 120 days it will automatically expire. 
  • Department of Treasury with usc exception
  • State Tax Lien
  • Lien by USA or Dept of Justice
  • US Department of State
  • Other Federal Agencies
  • Code Enforcement for debris removal or mowing
  • Demolition or Environmental Based Liens 
  • State child support lien
  • Board of County Commissioners for special assessments
  • Utility Liens
  • Water/Sewer Delinquency (only in selected states)
  • County (and/or School/Township) for unpaid taxes

Nice list @Chad Urbshott  , I just bought a foreclose with my spouse and the only thing that came up on the lien search was Miami Dade water. the utility in Miami follow the property owner, but the water stays with the property. At closing you have to escrow around $250 to pay for any unpaid water bill. since this was a homepath foreclosure we got a great deal. 


Okay.. There needs to be some clarification here. 

Once a bank foreclosures on a property in Florida it becomes and REO and it is owned by the bank. Many banks auction off their REO properties. Also HUD /FHA/VA take back properties after foreclosure and they are considered REO properties. Buying an REO property either through the MLS/Auction or directly from the Bank is usually safe assuming you get a Warranty Deed instead of a quitclaim deed all liens are usually paid off, but to help us give you advice please post that you are buying and REO that was previously foreclosed by the bank. You are NOT buying a property at Foreclosure.

If you are bidding on a property through the county's auction site or at the courthouse steps than you are buying a property at foreclosure.  Which if you don't know exactly what you are doing is very dangerous.  If you are a layperson and want to buy a property at foreclosure you need an attorney's assistant or at least having a title company or attorney pull and interpet the title work on the property.  You are also responsible for things that don't show up on the title. This is what title insurance protects a buyer from having to pay. South Florida was ground zero for mortgage fraud in the mid 2000s. I have seen many foreclosures with forged satisfactions and new mortgages issued. .  (This is not so prevalent in areas north of Miami Dade or Broward counties)

Anyway Just please let us know whether you are buying a Foreclosure or an REO as it affects our answers to be able to help


This is what I thinking to buy.

I bought one apartment in that complex and renovated it. It is currently under contract (cash buyer) and seems I made nice profit. 

@Wayne Brooks 

Thank you Wayne for your answer. Yes, I am not talking about county auctions.

The first place I bought (in the same apartment complex) was vacant. The broker who helped me told me that once it is foreclosed only unpaid HOA fees will survive. Also he has bought many and said that when ever it is vacant lot of times bank has paid the HOA fees (99% of his experience) and when there is somebody still in the HOAs are not paid?

@Chad Urbshott  undefined

Thank you for the nice list.


@Gustavo AL  undefined

Congrats Gustavo, I wish you all the best with your house

@Ray Slack  

Thank you Ray, I added a link

Occupancy doesn't matter as to current/past HOA dues. Our office reps Freddie Mac REO's. This is a Freddie Mac REO, and they will have paid the HOA dues past due at the the time of the foreclosure, And while they owned it. Paragraph 5 of the Freddie Mac addendum tells you they will pay them up to the time of closing, so it's a moot point.

Okay.. this is an REO being sold by a bank. is a pain in the *** to deal with... But I still buy properties from them.. The most important thing in the auction ad is this

  • Buyer will receive a Special Warranty Deed or equivalent.

That means that they will bring the HOA / condo fee current up through closing.. Please note that's title company charges high prices for closing fees to the buyer.. Depending on the closing price you may want to chose your own title company (Although you won't get the credit for an owner's title policy that you get by using their title agent)

You will also pay all the transfers and doc stamps that are normally split between a buyer and seller. 

The 2nd most important thing in the listing is that the condo is occupied.  This means different things depending whether it's the prior owner or a tenant living there.  If it's the prior owner you will have to file for eviction after you purchase the condo and have them removed.. This can take 3-4 months if they fight it... If it's a tenant with a valid lease and they have been paying their rent they have the right to stay until the end of their lease under the "protecting the tenant foreclosure act"  You will have the right to collect the rent from them after you close but can't really sell/Flip it until their lease expires. 


@Ray Slack  

Thank you Ray, so this auction says 

  • Buyer will receive a Special Warranty Deed or equivalent.

1) So that means the HOA fees will be paid, correct?

2) I got an estoppel letter from an attorney. It says unpaid HOAs are 4554.64, but there was a payment received on Jan/7th and the new balance is 1900 dollars due by Jan/30th. My question is since the buyer will get Special Warranty Deed it does not matter. The bank will pay the balance, correct? I did not need to spend the money on estoppel letter??

3) Also the estoppel says that there is unauthorized tenant living. I guess that is the case I need to evict? If it would be a tenant renting it would not be unauthorized.  

@Chad Urbshott  

Thank you for your answer and the full list.

From that full list what will come out on Title search and what will be on estoppel letter?

This is what I read, please correct me if I am wrong

  • IRS-under special circumstances (under 120 day redemption period from deed recording). If IRS does not exercise its redemption right within the 120 days it will automatically expire. (IT WILL BE ON TITLE SEARCH, CORRECT??)
  • Department of Treasury with usc exception (IT WILL BE ON TITLE SEARCH, CORRECT?)
  • Lien by USA or Dept of Justice (IT WILL BE ON TITLE SEARCH, CORRECT?)
  • US Department of State (IT WILL BE ON TITLE SEARCH, CORRECT?)
  • Other Federal Agencies (IT WILL BE ON TITLE SEARCH, CORRECT?)
  • Code Enforcement for debris removal or mowing (IT WILL BE ON ESTOPPEL LETTER, if done by HOA, CORRECT?)
  • Demolition or Environmental Based Liens (IT WILL BE ON TITLE SEARCH, CORRECT?)
  • State child support lien (IT WILL BE ON TITLE SEARCH, CORRECT?)
  • Board of County Commissioners for special assessments
  • Water/Sewer Delinquency (only in selected states) (IT WILL BE ON TITLE SEARCH, CORRECT?)
  • County (and/or School/Township) for unpaid taxes (IT WILL BE ON TITLE SEARCH, CORRECT?)

If I was wrong and the information can be found out by other way please advise!!


@Jaago Viitkin  

Municipal fines, utility liens and violations quite often do not show up on title searches. You must contact the applicable departments for each with the property address in question and request if there are any.  

As for all the other liens presented in the list above, as @Ray Slack  points out, since you'll be buying from and receiving a Special Warranty Deed, then all liens SHOULD be eliminated.  With this type of Deed, you should not have an issue obtaining title insurance once you own the property, but you might want to read the terms carefully to see if the bank will be omitting anything in the Deed transfer.  The list above is a comprehensive checklist of all items that need to be checked when buying from Courthouse step or County auctions. 

I would highly advise utilizing an attorney, or at least have an investor friendly Title Co. run a search for you prior to you bidding just to be sure there are no surprises.  They can often find things that the general public cannot.  Though, when bidding on online auction properties, any work you do in advance is often futile attempt since majority of the time the reserve is never met, and will continue being re-listed until some poor unsuspecting soul pays far more than the property is worth.  



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