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Tina, Lawyer
Category: Real Estate Law
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Experience:  17 years of legal experience including real estate law.
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In Florida, what happens to HELOC loan after 1st mortgage holder

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In Florida, what happens to HELOC loan after 1st mortgage holder forecloses on house? Can HELOC lender pursue collections action like in credit card situation or is FL a nonrecourse state for HELOC loans?
Hello and welcome,

Unfortunately, in FL as is the case in most states, HELOC loans are recourse loans and a lender may pursue a deficiency judgment or collections on the loan following foreclosure.

Here is a link that provides a summary on this issue:

In FL, a lender typically has 5 years from the date of the foreclosure sale to pursue a deficiency judgment against the borrower. So the lender can pursue collection on the debt and even a judgment against the borrower unfortunately.

Here is a link that summarizes a FL case which dealt with this issue:

I hope this helps clarify the situation for you. Please remember to rate my service once you have all the information you need. If you have any other questions, please ask me – I’ll be happy to respond. Thank you!


Note: Please feel free to request me if you have future legal questions by going to your “My Questions” page and clicking on “Request Tina again” next to my photo. I look forward to hearing from you again.

Customer: replied 4 years ago.

So to be perfectly clear, since the 1st mortgage was foreclosed with NO DEFICIENCY, then you are saying the HELOC, written off by the same lender as the 1st mortgage can be sought for payment? How much - the entire amount or just for what the loan was sold to the agency?

Hello again, Robert.

The fact that it was sold indicates that your lender had no interest in pursuing a deficiency judgment against you, but the balance of the HELOC can be sought by the current owner of the loan if they choose to pursue collections or legal action.

I hope that clarifies the situation for you. All the best to you.
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