Foreclosure Series Part 3: Can a mortgage ever be cancelled?

This blog is the final part of a three part series.  In the first 2 blogs of this series, we discussed common questions that arise concerning foreclosures in general, why they take so long and whether the bank is ever barred from re-filing a second foreclosure case after the initial foreclosure case is dismissed. 

This blog will address a question that frequently comes up, and that is, whether a mortgage can ever be cancelled and in what instances.  Homeowners faced with foreclosure have many questions and are eager to find some relief.  It does not seem fair that the bank can drag its feet for years and still foreclose, can they?  Is there anything the homeowner can do?  If the bank waits too long to foreclose can the mortgage be cancelled? 

According to the applicable law in Florida, in some instances a mortgage may be cancelled, but it depends upon several factors, including the terms of the loan documents and when the loan matures.  A mortgage lien remains valid 5 years from the date of maturity as reflected in the recorded mortgage.  Thus, generally speaking, a mortgage cannot be cancelled in a quiet title action if the face of the mortgage is clear that the maturity date has not yet occurred.  In cases where the 5 year statute of limitations has run on the enforcement of a mortgage, if a quiet title action is filed by the homeowner seeking cancellation of the mortgage, courts will typically dismiss it reasoning that the statute of limitations period does not affect the life of the lien or extinguish the debt - it merely precludes an action to collect the debt after 5 years. However, if the loan has matured and 5 years has passed from that date, then a quiet title action may very well be successful.  If so, the homeowner can cancel the debt and will own the property free and clear of the mortgage.

Please do not hesitate to contact our Firm to discuss your options based on your specific factual circumstances.  We routinely assist our clients with navigating through these questions and helping them develop a course of action. 

The contents of this blog and website are for informational purposes only and do not constitute legal advice.  Use of and access to this blog and website do not create an attorney-client relationship between the user and Iurillo Law Group, P.A.

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