Government Liens That Survive Florida Foreclosure

August 17, 202611 min readBy Barrett Henry, REALTOR®Last updated: August 17, 2026

One of the most important principles in Florida foreclosure law is that a foreclosure sale "wipes out" junior liens -- liens that are subordinate (junior) to the foreclosing mortgage. When the first-mortgage lender forecloses, junior liens such as second mortgages, HOA liens, and judgment liens are generally extinguished. However, government liens operate by different rules. Certain federal and state government liens have special protections that can allow them to survive a Florida foreclosure sale, creating unexpected liabilities for buyers and remaining exposure for former homeowners.

The General Rule: Junior Liens Are Extinguished

A Florida judicial foreclosure sale by the first-mortgage lender extinguishes junior liens if those lienholders are properly named and served as defendants. The lien priority hierarchy in a typical Florida residential mortgage:

Lien Type	Typical Priority	Extinguished by 1st Mortgage Foreclosure?
Real estate property taxes	Senior to all (F.S. 197.122)	No -- survive the sale; buyer takes subject to them
Special assessments (paving, water/sewer)	Often senior (F.S. 170.09)	Typically no -- check local ordinances
IRS federal tax lien (with proper notice)	Recorded date determines priority	Yes, if IRS given 25-day advance notice of sale
IRS federal tax lien (without proper notice)	Recorded date determines priority	No -- IRS retains 120-day redemption right
SBA disaster loan lien (with proper notice)	Recorded date determines priority	Yes, if United States given proper notice
HUD subordinate lien (with proper notice)	Junior to first mortgage	Yes, if HUD properly named as defendant
Florida Housing Finance Corporation liens	Junior to first mortgage	Yes, if FHFC properly named as defendant
Second mortgage, HELOC	Junior to first mortgage	Yes, if properly named
HOA/condo assessments (post-mortgage)	Junior to first mortgage	Yes, subject to safe harbor cap

IRS Federal Tax Liens: The 120-Day Redemption Right

The most significant government lien issue in Florida foreclosure is the IRS federal tax lien. Under 26 U.S.C. 7425 and 28 U.S.C. 2410:

The United States must be given at least 25 days written notice before a foreclosure sale when it holds a lien on the property
If proper notice is given, the IRS lien is extinguished by the sale (if it is junior to the foreclosing mortgage)
If proper notice is NOT given, the IRS retains a 120-day redemption right after the sale -- the right to step in and purchase the property at the sale price plus interest and costs

For Florida homeowners, the key action is to ensure the foreclosing lender's attorney names the United States as a defendant and provides the required 25-day advance notice. For buyers at Florida foreclosure auctions, checking for IRS liens and confirming proper notice is essential before bidding.

For more on IRS liens in Florida foreclosure, see our guide on IRS tax liens in Florida foreclosure.

HAF Program Liens

The Florida Homeowner Assistance Fund (HAF) provided financial assistance to Florida homeowners facing COVID-19 hardship. HAF assistance was typically secured by a subordinate lien on the assisted property. Key points for homeowners in foreclosure who received HAF assistance:

HAF liens are generally junior to the first mortgage and extinguished by a properly conducted first-mortgage foreclosure if the Florida Housing Finance Corporation was properly named
However, HAF program rules typically require repayment of the assistance if the home is sold or foreclosed within a specified period (often 5-10 years, depending on the assistance amount)
A short sale or pre-foreclosure sale during the repayment period may trigger HAF repayment obligations -- review your HAF agreement carefully

See our guide on Florida Homeowner Assistance Fund for current program status and details.

HUD Partial Claim and Subordinate Liens

FHA-insured homeowners who used HUD's COVID-19 loss mitigation tools -- including the COVID-19 Standalone Partial Claim -- received interest-free loans secured by a subordinate mortgage to HUD. These HUD subordinate liens:

Are due and payable when the property is sold, refinanced, or the FHA loan is paid off
Do not require monthly payments
Are extinguished by a first-mortgage foreclosure sale only if the United States (HUD) is properly named and given required notice under 28 U.S.C. 2410
May trigger reporting consequences when extinguished (1099-C for the HUD lien amount)

Property Tax Liens: Always Senior in Florida

One government lien that is never extinguished by a mortgage foreclosure in Florida is the property tax lien. Under F.S. 197.122, ad valorem property taxes create a lien on real property that is senior to all other liens, including first mortgages. When a property is sold at a Florida foreclosure auction, the buyer takes the property subject to any unpaid property taxes. This is not a theoretical risk -- Florida homeowners in foreclosure sometimes stop paying property taxes as well as mortgage payments, creating potentially significant outstanding tax liabilities for buyers.

See our guide on property taxes in Florida foreclosure for more information.

What Homeowners Should Do

Get a title search -- a current title search reveals all recorded liens, including federal tax liens filed in the county and federal courts
In a short sale, ensure the purchase contract and lender approval letter address how government liens will be handled at closing
Explore a short sale with your lender -- a properly structured short sale can address government liens before they become a buyer or title problem
Understand deficiency exposure -- the lien priority analysis also affects how much deficiency, if any, remains after a foreclosure sale
Contact us for a free consultation -- Barrett Henry helps Florida homeowners navigate the full lien landscape before any transaction

About Barrett Henry

Barrett Henry is a Broker Associate at REMAX Collective with more than 23 years of Florida real estate experience. Government lien issues frequently arise in pre-foreclosure sales and short sales, and Barrett coordinates with title attorneys to ensure all lien issues are addressed before closing. Barrett serves Tampa Bay directly and statewide through a trusted referral network covering all 67 Florida counties.

Concerned about government liens on your Florida property? Contact us today for a free consultation.

Behind on your mortgage?

Get a free, confidential consultation — no pressure to sell.

Get Free Help Call (813) 761-0133

Barrett Henry

REALTOR® & Broker Associate | REMAX Collective

Barrett Henry has 23+ years of real estate experience helping Florida homeowners navigate foreclosure, short sales, and distressed property situations. He serves all 67 Florida counties with offices in Tampa, Largo, and Brandon.

(813) 761-0133

Frequently Asked Questions

Do IRS federal tax liens survive a Florida foreclosure sale?

It depends on notice. Under 26 U.S.C. 7425 and 28 U.S.C. 2410, a federal tax lien is extinguished by a Florida judicial foreclosure sale ONLY if the IRS was properly named and notified of the sale with at least 25 days written notice before the sale date. If the IRS was not given the required notice, the IRS retains a 120-day right of redemption after the sale -- meaning the IRS can purchase the property at the foreclosure sale price and then resell it, even after the new owner has taken possession. Buyers at Florida foreclosure auctions must check for IRS liens and ensure proper notice was given.

What is the IRS 120-day right of redemption after a Florida foreclosure sale?

Under 26 U.S.C. 7425(d), when a property is sold at a state court foreclosure sale and the IRS was not given proper pre-sale notice, the United States has 120 days after the sale to redeem the property by paying the purchaser the amount paid plus interest and certain costs. This right is rarely exercised -- the IRS typically uses it only when the equity in the property substantially exceeds the foreclosure sale price and the government stands to recover a significant portion of the tax debt. However, the existence of this redemption right creates title uncertainty that can make it difficult to insure and sell the property until the 120-day period expires.

Do SBA disaster loan liens survive a Florida foreclosure?

Small Business Administration (SBA) disaster loan liens are federal liens governed by 28 U.S.C. 2410. They are subject to the same notice requirements as IRS liens -- the federal government must be properly named and notified at least 25 days before the foreclosure sale to extinguish the lien. If the United States was not given proper notice, the SBA lien may survive the sale. Florida homeowners who received SBA disaster loans after hurricanes, floods, or other disasters and later face foreclosure should ensure the SBA is named as a defendant in the foreclosure action.

What happens to HAF (Homeowner Assistance Fund) liens in a Florida foreclosure?

The Florida Homeowner Assistance Fund (HAF) program -- which provided assistance to Florida homeowners during COVID-19 hardship -- typically attached a subordinate lien to the assisted property. HAF liens are generally junior to the first mortgage and are extinguished by a first mortgage foreclosure sale if HAF was properly named as a defendant. However, HAF program rules vary, and some assistance was structured as a forgivable loan that must be repaid if the home is sold or foreclosed within a specified time period. Contact the Florida Housing Finance Corporation for specific HAF lien terms.

Do HUD subordinate mortgage liens survive a Florida foreclosure?

HUD subordinate mortgage liens -- such as those from the FHA's COVID-19 Recovery Standalone Partial Claim program -- are federal liens. Under 28 U.S.C. 2410, they are extinguished by a judicial foreclosure sale only if the United States (HUD) is properly named and notified in the foreclosure action. If HUD is not properly named, its lien may survive the sale. Servicers handling FHA-insured loans in foreclosure must follow specific procedures to properly name HUD and ensure its subordinate liens are addressed.

What about Florida Housing Finance Corporation (FHFC) subordinate liens?

The Florida Housing Finance Corporation (FHFC) issues subordinate mortgages to assist homebuyers with down payment and closing costs through programs like the Florida Assist Second Mortgage and the HFA Preferred Grant. These subordinate liens are state agency liens. As junior liens, they are generally extinguished by a senior first-mortgage foreclosure sale if the FHFC is properly named as a defendant. However, because FHFC liens are backed by state bond programs with forfeiture conditions, failing to name FHFC can lead to the subordinate lien surviving the sale and the new owner taking subject to it.

Do property tax liens survive a Florida foreclosure?

Property tax liens are in a special category. Under F.S. 197.122, property taxes create a lien on real property that is senior to virtually all other liens, including first mortgages. A mortgage foreclosure does NOT extinguish superior property tax liens -- the winning bidder at the foreclosure auction takes the property subject to any outstanding property taxes owed. Buyers at Florida foreclosure auctions must account for outstanding property taxes, which can be significant if the homeowner has been delinquent for multiple years.

How can a homeowner facing Florida foreclosure protect themselves from government lien issues?

Homeowners in foreclosure should: (1) conduct a thorough title search to identify all liens on the property, including federal liens recorded in the county property records and federal tax lien records (which are searchable through the IRS FOIA database); (2) ensure any pre-foreclosure sale (short sale or equity sale) addresses government liens directly; (3) if pursuing a short sale, require the lender and buyer to address IRS and other federal liens in the short sale approval agreement; and (4) consult with a Florida real estate attorney about the lien priority waterfall before any transaction.

Florida Foreclosure Guides

Understanding your options is the first step. These guides break down every path available to Florida homeowners.

→How Foreclosure Works in Florida →Ways to Stop a Foreclosure →Loan Modification Options →Short Sale Guide →Foreclosure vs. Short Sale →Lis Pendens Explained →Get a Cash Offer →Sell Before Foreclosure

Need Help With Your Situation?

Free consultation — no cost, no obligation, no judgment.

Full Name *

Phone Number *

Email Address *

Property Address (optional)

County *

Best Time to Call *

Tell Us About Your Situation (optional)

Your information is confidential. We will never sell your data.

Ready to Explore Your Options?

Get Free Help Now