New legislation aims to address Florida foreclosure crisis

April 04, 2013

Florida has been hit extremely hard by the foreclosure crisis. According to data published in the Herald-Tribune, 3.1 percent -- or 1 in 32 -- of all housing units in Florida were the target of a foreclosure filing in 2012. In fact, foreclosure filings last year were 70 percent higher than they had been in 2011.

The high rate of foreclosures has left many Florida homeowners fighting with their lenders and struggling to stay in their homes. In addition, the foreclosure crisis has negatively affected the entire real estate market, since a glut of vacant and inexpensive homes has pushed overall prices down.

Florida legislators have been working on ways to address this problem, to mixed effect. Currently, there are two major foreclosure bills working their way through the legislature: one that would create a homeowner "bill of rights" and another that aims to create a speedier process for judicial review of foreclosures.

Homeowner bill of rights

The homeowner bill of rights legislation is being sponsored by Rep. Mark Danish of Tampa. Among other things, the legislation prohibits lenders from foreclosing on a home until the lender has made a good faith effort to consider the borrower for a loan modification. Lenders that deny a loan modification application would be required to provide borrowers with specific justification for the denial.

The legislation also requires lenders to provide borrowers with a single contact person who will be responsible for answering borrowers' questions and guiding them through the foreclosure process.

In addition, the legislation establishes a more transparent framework for requesting and approving short sales.

Process legislation

The process legislation, on the other hand, is not aimed so much at protecting borrowers as it is at clearing the excess supply out of the Florida housing market. It would remove some hearings from the foreclosure process and would shift the burden of proof so that borrowers would be required to prove why a lender should not be granted an expedited foreclosure.

It would also prevent homeowners who had been wrongfully foreclosed on from suing to get their houses back. Instead, they would be limited to seeking monetary damages.

Working with a foreclosure defense attorney

Regardless of whether these bills become law, it is important for homeowners in Florida to understand just how complex the state's foreclosure process is. Very few homeowners are equipped with either time or knowledge it takes to fully protect their rights in a foreclosure proceeding. For that reason, homeowners facing foreclosure would be wise to consult with an experienced Florida foreclosure defense attorney. The attorney will be able to review all of the facts in case to determine the best options for moving forward.

Article provided by Mascia Law Firm, P.L.
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