Mortgage lenders use every contractual and other opportunity that may be available to them to squeeze fees out of borrowers, including, in a majority of mortgage documents, a fee provision that lets a lender collect attorneys’ fees if it wins a foreclosure case but that prevents the borrower from collecting fees if the borrower wins. The Florida legislature attempted to correct this imbalance when it enacted Section 57.105(7) of the Florida Statutes, which under the correct circumstances allows a borrower to collect fees when it prevails in a foreclosure defense case. A recent decision from a Florida appellate court indicates that a borrower may not always get the benefit of this law even when the borrower prevails.

In Florida Community Bank, N.A. v. Red Road Residential, LLC, a lender sued a business and its husband and wife owners to foreclose a mortgage loan that was secured by property. The wife defended against the foreclosure action separately from her husband with an argument that she did not sign the mortgage contract and that the mortgage documents that included her name were fraudulent. In response to these defenses, the lender agreed to drop her from the case. She then cited the Florida statute to claim that she was entitled to collect her fees from the lender. The trial court ordered the lender to pay those fees to her, but the appellate court overruled that order. That court stated that per her own arguments, she was not a party to the mortgage documents and accordingly she had no right to invoke a statute that was designed only to protect signatories to mortgage documents.

This case makes it clear that nuances of mortgage foreclosure defenses can trip up even parties that state legitimate defenses to foreclosure claims from lenders. If you or your business have been named in a mortgage foreclosure action in Florida, you will need a foreclosure defense attorney who understands all of these nuances and who can give you the best advice that can get you out of the loan and even help you keep your property. The attorneys at the Law Offices of Jonathan Kline, P.A., have extensive knowledge and experience with Florida mortgage defense law. We have helped numerous parties in foreclosure cases brought by aggressive lenders. Please contact us for assistance in defending against your Florida foreclosure action.

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