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The real estate crisis hit Florida hard. The state has one of the nation’s largest backlogs of foreclosures. Something that isn’t surprising when you consider that Florida also has one of the longest repossession timelines at 676 days.
In order to deal with this glut of foreclosures, the state house recently passed the "Florida Fair Foreclosure Act," to shrink that time. It also changes the amount of time a bank can go after a foreclosed homeowner for a deficiency judgment to from five years to one year, reduces the number of required hearings and allows for speedier foreclosures of abandoned properties.
But, as with any proposed law, there are ups and downs. Let’s go through a few. Comment or send me an email to tell me where you stand.
- Speeding up the foreclosure process will boost the state’s economy because homes can be put back on the market and improved.
- Shortened time between an owner abandoning a property and the bank foreclosing on it means the property won’t sit vacant and fall into disrepair. Banks can take responsibility for them, bring them up to code and sell them for a reasonable price. (See this example of how a shortened time between abandonment and foreclosure would have helped property values and the neighborhood.)
- This bill strengthens the requirement of proof that a party trying to foreclose on a property actually owns it. Banks would have to show how the mortgage was bought and sold, or justify to a T why original documents are not available. This will prevent fraud in the speedier process.
- Florida’s courts are packed with foreclosure requests, and the housing market in Florida is continuing to fall. In order for the market to be brought back to normalcy, the glut of abandoned homes needs to be sold off and the stagnant amount of homes in foreclosure needs to be dealt with. A turnaround rate of 676 days is not sustainable.
What do you think?