Under Florida Law, the five-year statute of limitations on foreclosure begins to run when the last payment is due unless the mortgage or promissory note contains an optional acceleration clause. When the promissory note or a mortgage contains an optional acceleration clause, the five-year statute of limitations begins to run on the date the acceleration clause is invoked.
Fla. Stat. § 95.281(3) provides generally that the cause of action for mortgage foreclosures accrues at the time of the maturity date of the mortgage, however there exists a number of Florida decisions that have recognized a common law exception.
It is now clear under Florida law that when the promissory note secured by the mortgage contains an optional acceleration clause, the foreclosure cause of action accrues, and the statute of limitations begins to run, on the date the acceleration clause is invoked or the stated date of maturity, whichever is earlier.
Statute of limitations on mortgage foreclosure begins to run at the time of acceleration rather than at time of stated maturity date. In Locke v. State Farm Fire & Cas. Co., that Court denied Defendant's Motion to Dismiss where the Defendant was in default and the mortgagee filed its complaint after five-years from the default. That Court held the mortgagee had not elected to exercise its optional acceleration clause until the filing of its complaint and therefore the statute of limitations was not tolled and the action was proper.
In the case of Travis Co. v. Mayes, the Florida Supreme Court noted where a mortgage contains an automatic acceleration clause, the statute of limitations begins to run immediately when the default takes place.
Should a situation arise where a note and mortgage executed by the same parties as part of a single transaction regarding the same subject matter but contain two different acceleration clauses, the documents should be read and construed together so that the intent of the parties can be determined and carried out. In KRC Enterprises, Inc. v. Soderquist, the Defendant executed a promissory note that stipulated that upon default the unpaid principal and accrued interest would become due and payable. The mortgage however, provided for acceleration at the option of the mortgagee.That Court held reversed the District Court and said since the mortgage specifically provided that "anything in said promissory note or herein to the contrary notwithstanding," the mortgage optional acceleration clause prevails over the language of the note and therefore the five-year statute of limitations had not run.
Where no acceleration clause exists in a mortgage or promissory note agreement and the maturity date of the final installment of the obligation is ascertainable from the record of the mortgage, the five-year statute of limitations shall run from the maturity date of the final installment. In Conner v. Coggins, the Appeals Court affirmed the decision of the District Court and held an action against the Defendant for foreclosure was not barred by the statute of limitations. In that case the mortgage and installment contract did not contain an acceleration clause, the action was filed more than five years from the date of the mortgage and more than five years from the date of default, but within five years of the maturity date of the final installment. That Court further held, the mortgagee could have foreclosed earlier upon a previous default, but had mortgagee done so, mortgagee would have lost the security for subsequent unmatured payments.
In short the five-year statute of limitation period may accrue prior to the maturity date of a mortgage in two instances, where a lender has enforced an optional acceleration provision or where a lender maintain an automatic acceleration clause.