If Bob buys a property "subject to"from Pam, leases it to Jim in a lease option to buy,

Question

then Bob defaults on Pam's loan and the house goes into foreclosure, can Jim or Pam file any type of legal action against Bob?

PS: This is in the state of Florida

Answer 1

Bob bought a house.  He lost that house to foreclosure.  He didn't want to lose it.  He didn't intend to lose it.  So it is not easy for Jim to go after Bob.  

The original mortgage had "And Assignment of Rents" on the first page-- often right at the top in bold letters.  It means that Bob can not collect the rent and not pay that amount (even if it is less than the normal mortgage payment) to the lender.  Bob was not allowed to do that.  It sounds like Bob did pocket the rent.  That is what can get Bob into trouble. /

Answer 2

It depends on facts not evident from your question.  Bob may be liable for any purchase money deposit Jim paid as part of his lease to own.  He could also be liable to Pam for any deficiency judgment she may have to pay in the foreclosure (she would be named as a defendant in the foreclosure because the mortgage was in her name, but she probably would not have a deficiency judgment entered against her).  There could also be incidental damages (costs of moving, etc) for Jim.

If Bob had the ability to pay the mortgage and simply refused to pay, then they may be criminal and/or civil fraud charges.  It al depends on the precise facts.