The Florida Foreclosure Debacle
September 5, 2010 by Rachel Baker · Leave a Comment
We all know Florida is in the midst of a foreclosure crisis:
The state routinely sets new records for foreclosures — in the second quarter, 20.13 percent of its mortgages were delinquent or in foreclosure, a national high, according to the Mortgage Bankers Association. And with housing prices still in a free fall, almost half of all borrowers in Florida owe more on their mortgages than their properties are worth, says CoreLogic, a data firm.”
No one disputes that foreclosures dominate Florida’s dockets and that something needs to be done to streamline a complex and emotionally wrenching process. But lawyers representing troubled borrowers contend that many of the retired judges called in from the sidelines to oversee these matters are so focused on cutting the caseload that they are unfairly favoring financial institutions at the expense of homeowners.
The NY Times has an interesting informative article on this issue.
This is a really long article (I’ve provided the link to see the whole article on one page), but its worth a read. The article touches on the Foreclosure Courts set up to address the foreclosure backlog; the challenges that have arisen from these courts in regards to questions of ownership; and the Florida Attorney General’s response to the practices of these courts.
Excerpts:
Setting up discrete foreclosure courts statewide was seen as a way to help deal with the issue; consumer law experts say they aren’t aware of any other state that has set up a temporary court to work down such a backlog.
But it is paradoxical, say lawyers representing homeowners in the cases, that Florida’s attorney general acknowledges problems in the cases while retired judges, intent on reducing caseloads, seem unconcerned about those same problems — like flaws in the banks’ documentation of ownership.
and
The Waters case offers an example of how wrong things can go in complex foreclosure cases.
While AmTrust, a failed Ohio bank that is now a division of New York Community Bank, said it owned the note and could foreclose, Mr. Waters’s lawyer produced documents showing that Fannie Mae, the taxpayer-owned mortgage finance giant, was really the owner.
In spite of the conflicting evidence, Aaron Bowden, the retired judge overseeing the case, made a summary judgment on Aug. 3, ruling that the property should go back to AmTrust.
…David Tong, the lawyer representing AmTrust in the case, declined to comment on the matter. But on Friday, he did an about-face, filing papers with the court acknowledging that Fannie Mae owns the note.
As a Floridian, I thinks its our duty to at least know what’s been going on. Judges’ rulings can set precedence that have far reaching consequences.
It is really tough to know, at this time of the year, if an article was written for political reasons during an election cycle. While I don’t know the answer to why this written, I’m willing to bet the examples in the article are on public record with the case documentation.
Regardless of why this was written, I think the article warrants some attention from regular every day Floridians. Frankly, after reading this article, I can’t help but wonder if the crisis would be near as bad if attention to detail was demanded.
One firm, as cited in this article,
…filed 70,382 foreclosure cases last year. Critics say the Stern firm has been able to handle this high volume because its lawyers frequently refuse to work with borrowers and are very aggressive about pushing cases through the courts even when there are questions about the documentation.
I can’t help but wonder if the number would be much lower if the justice department was not just trying to clear a backlog.
Read the article, see what you think. If nothing else, maybe we should be asking the Candidates about what they will do to fix this.
