Florida Condo Foreclosure: Special Rules Under F.S. §718

If you own a condominium in Florida and are facing foreclosure, the rules that apply to your situation are different — and in some ways more complex — than the rules for single-family home foreclosure. Florida Statute §718, the Condominium Act, creates special assessment lien rights, super-lien priority, and safe harbor provisions that can involve your condo association as an additional party with significant legal power.

This guide explains the special rules that apply to Florida condo foreclosure, including how the association's lien works, what the super-lien means for your situation, and what options you have.

How Does Florida's Condo Assessment Lien Work?

Under F.S. §718.116, every condominium unit owner is jointly and severally liable for all assessments levied by the association. When you fall behind on your monthly or quarterly assessments, the association has the legal right to record a claim of lien against your unit.

The lien process typically works like this:

1. You miss assessment payments — The association sends notices and demand letters.
2. Intent to lien notice — The association must send a written notice of intent to record a lien at least 30 days before recording under F.S. §718.121.
3. Lien recorded— The association files a claim of lien with the county recorder. The lien includes unpaid assessments, late fees, interest, and the association's attorney fees.
4. Foreclosure lawsuit — If you do not pay, the association can file a foreclosure action in circuit court, following the same judicial process as mortgage foreclosure.

The attorney fees component is particularly significant in condo association foreclosures. Florida law allows the association to recover reasonable attorney fees in collection and foreclosure actions, and these fees can quickly exceed the original assessment debt.

What Is the Condo Association Super-Lien?

The most important difference between condo and single-family foreclosure is the super-lien. Under F.S. §718.116(1), the condominium association's lien for unpaid assessments has priority over the first mortgage for a limited amount:

• Up to 12 months of regular periodic assessments, OR
• 1% of the original mortgage debt
• Whichever amount is less

This means the condo association can claim a portion of the property's value ahead of the mortgage lender. In practice, this gives the association significant leverage:

• The association can foreclose on the super-lien amount even if the unit is worth less than the mortgage balance
• The mortgage lender has a financial incentive to pay the association's lien to protect its own position
• The super-lien creates a faster path to resolution for the association compared to HOA foreclosures for non-condo properties (which do not have super-lien priority)

The Safe Harbor Provision

The safe harbor provision in F.S. §718.116(1)(b) limits the amount a first mortgage lender must pay to the condo association when the lender acquires the unit through foreclosure. The safe harbor amount is the same calculation as the super-lien: 12 months of regular assessments or 1% of the original mortgage debt, whichever is less.

Important details about safe harbor:

• Safe harbor limits the lender's liability — not yours. The association can still pursue you personally for the full amount of unpaid assessments beyond the safe harbor.
• Safe harbor applies only to the first mortgage holder. Second mortgage holders and other junior lienholders are not protected by safe harbor.
• The association must provide notice to the lender of the outstanding assessment balance before the safe harbor limitation applies.

Dual Foreclosure: Lender and Association

Condo owners in Florida can face simultaneous foreclosure actions from both the mortgage lender and the condo association. These are separate lawsuits that proceed independently through the court system.

When both are pursuing foreclosure:

• If the lender forecloses first, the association receives the safe harbor amount and the new owner assumes responsibility for future assessments.
• If the association forecloses first, the new owner takes the unit subject to the existing mortgage. The mortgage lender can then foreclose separately.
• Both cases can settle through negotiation, mediation, or if you resolve the debt before either sale occurs.

Special Assessments and Building Repairs

Florida condo associations sometimes levy special assessments for major repairs, building improvements, or to replenish reserves. Following recent changes to Florida law requiring structural reserve studies and milestone inspections for older buildings, many associations have increased regular assessments and levied special assessments to build adequate reserves.

These increased costs have pushed some condo owners into financial difficulty. If a special assessment of thousands of dollars is levied on top of already rising monthly assessments, the total financial burden may become unsustainable.

Special assessments are included in the association's lien, but the super-lien priority typically applies only to regular periodic assessments. This distinction matters when calculating the association's priority position relative to the mortgage.

Your Options as a Florida Condo Owner Facing Foreclosure

Barrett Henry, a REALTOR with 23+ years of real estate experience and Broker Associate at REMAX Collective, works with Florida condo owners navigating both mortgage and association foreclosure situations. Your options include:

• Negotiate with the association— Many associations will accept payment plans for delinquent assessments. Contact the board or management company in writing to request an arrangement. Getting a payment plan in place can stop the association's foreclosure action.
• Apply for a loan modification — A loan modification can reduce your mortgage payment and free up funds to keep assessments current.
• Sell the unit — A pre-foreclosure sale or short sale resolves both the mortgage and assessment debts from the sale proceeds.
• File an answer to both lawsuits — If both the lender and association have filed, respond to both within the 20-day deadline.
• File for bankruptcy — Chapter 13 bankruptcy can address both the mortgage arrears and the delinquent assessments through a single repayment plan.

Facing a condo foreclosure in Florida? Contact us today for a free consultation — no cost, no obligation.