By Michael S. Perse
Last week, the Third District Court of Appeals’s decision in AG Group Investments, LLC v. All Realty Alliance Corp. provided those of us who handle foreclosure cases with a much-needed review of Florida law.  Simply stated, the Third reminded parties that junior lenders still have rights and their rights cannot be foreclosed until after the foreclosure sale.  If you are a junior lender facing extinguishment of your mortgage as a result of a foreclosure sale, your rights will not be foreclosed until after the Certificate of Sale is recorded.

In this case, another junior mortgage holder, Pinnacle Three Corp., purchased the first position days before the foreclosure sale date.  Then, Pinnacle somehow convinced the trial court that the other junior mortgagor did not have rights in the subject property.  However, the Third District reminded us all that junior mortgagors’ rights will not be extinguished until after the foreclosure sale – something that is important to remember if you are or you represent a junior mortgagor.