Deficiency for an owner-occupied home is capped by fair market value
Fla. Stat. § 702.06
In plain words
Florida allows a lender to seek a deficiency judgment, but for an owner-occupied home the deficiency cannot be more than the judgment amount minus the home’s fair market value on the sale date. The lender also has only one year after the sale to sue for a deficiency on a 1–4 unit home.
Who is protected
Owner-occupants of Florida residential property sold in foreclosure or a short sale.
When it applies
- Only in Florida.
- Only after the foreclosure sale.
- Only if the home is your primary residence.
What you can do
Get ready for court
If a deficiency is sought, ask the court to decide the home’s fair market value; bring an appraisal or comparable sales.
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Our Florida page explains the whole process step by step, with its sources and free local help.
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Honest limits
- A deficiency is still possible if the debt is larger than the home’s value.
- The court has discretion whether to enter a deficiency at all.
- This is general education, not legal advice. Laws change and details depend on your papers and your court; check the current law or ask a lawyer or legal aid.
The law
- State lawDeficiency limited by fair market value
Fla. Stat. § 702.06
What it says: For owner-occupied residential property, a deficiency may not exceed the judgment amount minus fair market value on the sale date.
Read the official texthttps://www.flsenate.gov/Laws/Statutes/2026/702.06 - State lawOne-year limit to sue for a deficiency
Fla. Stat. § 95.11(6)(g)
Exact part: (6)(g)
What it says: Sets a one-year limit for a deficiency action on a 1–4 unit residential property after foreclosure.
Read the official texthttps://www.flsenate.gov/Laws/Statutes/2026/95.11
Court cases
- Homeowner wonSame topicJerman v. Carlisle, McNellie, Rini, Kramer & Ulrich, L.P.A.
Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich, L.P.A., 559 U.S. 573 (2010)
the FDCPA's bona fide error defense does not excuse a debt collector's incorrect interpretation of what the Act requires
- Homeowner wonSame topicKaltenbach v. Richards
Kaltenbach v. Richards, 464 F.3d 524 (5th Cir. 2006)
a person who meets the FDCPA's general definition of debt collector is subject to the whole Act even while enforcing a security interest
- Homeowner wonSame topicHeintz v. Jenkins
Heintz v. Jenkins, 514 U.S. 291 (1995)
the FDCPA applies to lawyers who regularly collect consumer debts, even through litigation
- Homeowner lostSame topicObduskey v. McCarthy & Holthus LLP
Obduskey v. McCarthy & Holthus LLP, 586 U.S. 466 (2019)
a business engaged only in non-judicial foreclosure is not a debt collector under the FDCPA, apart from the provision barring threats to take property without a present right
- Homeowner lostSame topicMidland Funding, LLC v. Johnson
Midland Funding, LLC v. Johnson, 581 U.S. 224 (2017)
filing an obviously time-barred proof of claim in bankruptcy does not violate the FDCPA
- Homeowner lostSame topicMartins v. BAC Home Loans Servicing, L.P.
Martins v. BAC Home Loans Servicing, L.P., 722 F.3d 249 (5th Cir. 2013)
a mortgage servicer acting for a properly assigned mortgagee may foreclose in Texas without possessing the original note, and an oral promise to modify a large loan is not enforceable
Related rights
Right to surplus money after a foreclosure sale
Fla. Stat. § 45.032(2)–(3)
If your home sells at the clerk’s sale for more than the judgment, the extra money is surplus. Florida law presumes the owner of record when the case was filed is entitled to it, after junior lienholders who file timely claims. You can claim it through the court; the clerk holds it until a judge orders payment.
Read this rightAfter a discharge, creditors cannot collect the wiped-out debt from you
11 U.S.C. § 524(a)(2)
A bankruptcy discharge wipes out your personal liability for most debts in the case. After that, the law forbids creditors from suing, calling or otherwise trying to collect a discharged debt from you personally. A court can hold a creditor in contempt if there was no fair doubt that its conduct was barred.
Read this rightThe government cannot keep your home equity beyond the tax debt
U.S. Const. amend. VTakings Clause
If your home is taken or sold to pay property taxes, the government may collect what you owe, but it may not keep the extra value. Keeping the surplus is a "taking" of your property without just compensation, which the Fifth Amendment forbids (Tyler v. Hennepin County, 2023). You may be able to claim the surplus, but you usually must follow your state's claim process and deadlines.
Read this rightA collection or charge-off must carry its real delinquency date
15 U.S.C. § 1681s-2(a)(5)(A)
A company that reports an account placed for collection or charged off must tell the credit bureau the month and year the delinquency began, within 90 days. That date sets when the item must come off your report, and it does not change when the debt is sold.
Read this rightMake the company that reported the error investigate it
15 U.S.C. § 1681s-2(b)(1)
The company that reported the information — such as your servicer — must investigate when a credit bureau passes along your dispute, and fix what is wrong with every bureau. In many cases you can also dispute directly with that company, which must then investigate and report back to you.
Read this rightMost negative items must come off after 7 years
15 U.S.C. § 1681c(a)(a)(1), (4), (5)
Credit bureaus may not report collection accounts, charge-offs and most other negative items that are more than 7 years old. For a collection or charge-off, the 7 years start 180 days after the delinquency that led to it began — so, about 7½ years from the first missed payment that was never brought current. Paying, settling or re-selling the debt does not restart this clock. Bankruptcies can be reported for 10 years.
Read this right