Lenders Beware–Retroactive Tax Lien Trumps Recorded Mortgage [Florida]

Under Florida law, a mortgage lender’s lien against real property takes priority over later filed liens. However, under Fla.Stats. §197.122(1), ad valorem tax liens filed against Florida real property will take priority over a previously filed mortgage – such tax liens become super liens. Not great for lenders, but at least they can deal with exposure to these tax liens against their security by making sure ad valorem taxes are properly paid (e.g., through mortgage escrows and/or covenants in the mortgage to keep taxes current).

Fla.Stats. §196.161 allows a property assessor to go back 10 years and assess taxes, a penalty of 50% of taxes, and 15% interest . .

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