Florida Condominium Assessments: What Foreclosure Buyers Must Know About Purchaser Liability Under Section 718.116
Introduction
Foreclosure investors targeting Florida condominiums face a liability trap that catches even experienced bidders off guard. Unlike many property types where a foreclosure sale may extinguish certain obligations, Florida's Condominium Act creates a statutory framework that passes unpaid assessment debt directly to the new owner—regardless of how title was acquired.
Florida Statutes Section 718.116 establishes clear rules governing this liability transfer. Understanding precisely what the statute mandates, and what it does not address, is essential before bidding on any condominium unit at foreclosure.
The Core Statutory Framework
Section 718.116(1)(a) establishes two distinct categories of assessment liability for unit owners:
Current assessments: A unit owner "is liable for all assessments which come due while he or she is the unit owner." This applies "regardless of how his or her title has been acquired, including by purchase at a foreclosure sale or by deed in lieu of foreclosure."
Pre-transfer assessments: The statute further provides that "a unit owner is jointly and severally liable with the previous owner for all unpaid assessments that came due up to the time of transfer of title."
This joint and several liability provision is particularly significant for foreclosure purchasers. It means the condominium association may pursue the full amount of unpaid assessments from either the previous owner or the new purchaser—or both. As a practical matter, associations typically pursue whoever has assets available, and a successful bidder at foreclosure has just demonstrated liquidity.
The Association-as-Prior-Owner Exception
The statute carves out one important exception to joint and several liability. When a condominium association itself acquires title to a delinquent unit through its own foreclosure action or by accepting a deed in lieu of foreclosure, the association is explicitly excluded from the definition of "previous owner" for liability purposes.
The statute specifies: "A present unit owner's liability for unpaid assessments is limited to any unpaid assessments that accrued before the association acquired title to the delinquent property through foreclosure or by deed in lieu of foreclosure."
This means if an association forecloses its assessment lien, takes title, and later sells the unit, the subsequent purchaser is not jointly liable for assessments that accrued during the association's ownership period. However, this exception applies only when the association itself held title—not when a third-party lender or other entity was the foreclosing party.
The Right of Recovery
The statute preserves a new owner's theoretical right to pursue the former owner for reimbursement. It states that joint and several liability exists "without prejudice to any right the owner may have to recover from the previous owner the amounts paid by the owner."
However, this right has limited practical value in most foreclosure scenarios. A previous owner whose property proceeded through foreclosure is often judgment-proof or difficult to locate. The statute creates the legal right but does not guarantee collectability.
What the Statute Does Not Address
Section 718.116(1)(a) establishes liability principles but leaves several critical questions to other statutory provisions, case law, or association governing documents:
- The statute does not specify how to calculate the exact assessment amount owed at any given time
- It does not establish procedures for obtaining payoff information from associations
- It does not address special assessments versus regular assessments in the liability calculation
- It does not resolve priority disputes between competing lien types
These gaps make pre-auction due diligence essential rather than optional.
Verification Steps for Foreclosure Bidders
Before bidding on any Florida condominium at foreclosure, investors should verify several categories of information:
Association estoppel certificate: Request a formal statement from the association showing all amounts currently due. Florida law elsewhere governs the association's obligation to provide this information, but obtaining it requires affirmative effort by the prospective purchaser.
Assessment history: Review recorded liens and any court filings involving the association and the subject unit. Look for evidence of special assessments, which may represent significant additional liability.
Foreclosing party identity: Determine whether the foreclosure is being conducted by a mortgage lender, the association itself, or another lienholder. The association-as-previous-owner exception only applies in specific circumstances.
Chain of title: Examine whether the association previously held title to the unit. If so, the exception limiting liability to pre-association assessments may apply.
Hypothetical Illustration
The following example is hypothetical and does not represent any actual property, transaction, or dollar amount.
Consider a scenario where a mortgage lender forecloses on a condominium unit. The previous owner had not paid monthly assessments for an extended period. A bidder purchases the unit at the lender's foreclosure sale, believing the foreclosure extinguished all prior obligations.
Under Section 718.116(1)(a), the bidder would be jointly and severally liable with the previous owner for all unpaid assessments that accrued before the foreclosure sale transferred title. The association could demand payment from the new owner, and the new owner's only recourse would be attempting to recover from the now-foreclosed previous owner.
Key Takeaways
- Florida Statutes Section 718.116(1)(a) makes foreclosure purchasers jointly and severally liable for unpaid assessments from the previous owner's tenure
- The method of title acquisition—including foreclosure purchase—does not eliminate this liability
- An exception exists when the association itself previously held title through its own foreclosure or deed in lieu
- The statutory right to seek reimbursement from the previous owner has limited practical value in most foreclosure contexts
- Obtaining current assessment information directly from the association is essential before bidding
How TitlePin Can Help
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