Lenders in Florida should note a new statutory protection for residential tenants in foreclosed homes that may delay a lender’s ability to take possession after a foreclosure sale. On June 2, 2015, Governor Rick Scott signed HB 779, creating Florida Statute 83.561. The new statute requires that the purchaser at a foreclosure sale take title to residential property subject to the tenant’s leasehold rights. The tenant may remain in possession of the premises until the new owner serves a 30-day notice of termination. During this 30-day period, the tenant is obligated to pay any rent accruing during the period and the new owner assumes certain statutory obligations as a landlord. The statute provides the form of termination and the method of delivery. If the tenant does not vacate at the end of the 30-day period, the new owner may apply to the court for a writ of possession based upon a sworn affidavit. The statute does not apply, however, where (1) the tenant is the mortgagor or is the child, spouse, or parent of the mortgagor; (2) the rental agreement is not the result of an arm’s length transaction; or (3) the rental agreement allows the tenant to pay rent that is substantially below fair market value (unless subsidized). The statute went into effect on June 2, 2015.

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