Warranty Deed to Trustee and Lease

We were renting a property, and found out July 28th it was in foreclosure. Long story short- the homeowner stopped communicating with us, stopped caring for the property as required in the lease, and refused to put our security deposit into a trust account (she was not required by FL law to hold it separately at lease signing). So we wrote and advised her to keep two months rent out of the security deposit and last month's rent we had given her at lease signing, gave our notice and we leased at a new property. I received notice from the attorney representing the bank, because we were listed as tenants, that they filed a motion for summary judgement. So I went on line to see exactly what was going on and I noticed in the court documents that the homeowner signed a "Warranty Deed to Trustee" back on June 13th (although it oddly wasn't filed at the court until mid October). The reason this is of interest to us is because the homeowner still owes us $1000 of the security deposit- she never made a claim against it in the allowed time frame. I am debating filing in small claims court and the only reason I haven't is because I doubt I would ever be able to collect. But what exactly does this Warranty Deed mean? Can she reassign the property "free of all encumbrances" while we had a lease with her? Should she even have collected the rent she did after that point? It just seems like she is doing something completely shady here.