top of page
Diaz Anselmo & Associates

FRAUDULENT EQUITABLE LIEN FORECLOSURES | KEY POINTS

  • Writer: diazanselmo
    diazanselmo
  • Feb 24, 2023
  • 2 min read

Updated: Mar 21

  1. Over the last few years Florida courts have seen an increase in equitable lien foreclosures in what appears to be a prolific scheme to defraud unsophisticated and unsuspecting third-party purchasers at foreclosure sales. The Second DCA of Florida rendered a decision earlier this month in Quest Sys., LLC v. Far, No. 2D22-1545, 2023 WL 1806213, at *1 (Fla. 2d DCA Feb. 8, 2023) where, based on evidentiary deficiencies, the Court was unable to put a stop to the scheme.

  2. The core facts in each of these cases appear to be the same: A mortgage loan goes into default, a third party owner takes title to the property subject to a superior lien, simultaneous with taking title, the new owner is sued by another entity which claims to have provided funds for the most recent acquisition of the property, the new owner and the foreclosing entity consent to judgment within hours of the complaint being filed, the court enters the consent judgment, the property proceeds to sale, and an unsuspecting third-party purchases the property at the sale all within a matter of weeks. That is what happened in the Far case.

  3. Although the lower court vacated the sale in Far, the Second DCA reversed that order finding there to be a lack of substantial competent evidence to demonstrate any fraud or irregularity at the sale or any connection with the sale. The DCA concluded that Far failed to connect the dots between his decision to bid on the property, his lack of knowledge of the first mortgage and Quest’s fast-track foreclosure of its allegedly equitable lien. There is sure to be additional litigation on this subject and we will keep you apprised of significant developments.


 
 

Headquarters:

499 NW 70th Avenue, Suite 309 

Plantation, FL 33317

Main: 954-564-0071

Fax: 954-564-9252

Mailing Address:

PO Box 19519

Fort Lauderdale, FL 33318
 

Main: 954-564-0071
Fax: 954-564-9252

Diaz Anselmo & Associates P.A.

Indiana

9465 Counselors Row, Suite 200
Indianapolis, IN 46240

Kentucky
50 East River Center Blvd., Suite 412
Covington, Kentucky 41011​

Ohio
400 Techne Center Drive, Suite 111
Milford, OH 45150

Wisconsin
342 N. Water Street, Suite 600
Milwaukee, WI 53202

Illinois
1771 West Diehl Road, Suite 120
Naperville, IL 60563


Main: 630-453-6960
Fax: 630-428-4620


Real Estate Main: 630-453-6800
Real Estate Fax: 630-428-4640

Website: diazanselmo.com

© 2025 Diaz | Anselmo Attorneys At Law

Crafted By: Finfrock Marketing

bottom of page