Florida Gov. Rick Scott is considering whether to sign a bill meant to speed up the home foreclosure process. But foreclosure lawyers are saying the measure is unfair to consumers, and they’re threatening a legal fight if it becomes law.
Florida’s housing market may be improving, but courts are still getting crushed by the backlog of foreclosure cases—that’s lenders trying to take possession of property when someone can’t pay a mortgage. As of February, about 340,000 foreclosure cases sat unresolved in Florida courts. And it’s predicted an additional 680,000 cases will be opened in the next two years.
Courts and lawmakers agree that’s a problem, but there’s disagreement about how to alleviate it. One solution is in a bill now before Scott, sponsored by Sen. Jack Latvala (R-Clearwater).
Debating the bill on the last day of the legislative session, Latvala said, “I don’t think our real estate market will really start getting back to normal in Florida with new home building and so forth unless we can reduce this backlog. I think we’ve added safeguards in this bill that on balance make it much more tilted toward consumers than it is the banks.”
Among other things, the measure would require judges to act more quickly through parts of the foreclosure process. And it requires judges to consider filings immediately without a hearing.
But some foreclosure lawyers are threatening to appeal it if Scott signs it. They say it gives the legislature too much control over the judicial branch. Matthew Weidner, from St. Petersberg, is part of the group Florida Consumer Justice Advocates, which formed in opposition to the bill.
“We’re hopeful that Governor Scott will look at the legislation with his legal team and recognize the very real constitutional problems and not sign this bad legislation into law,” Weidner said.
The group has several complaints with the bill. The biggest, they said, is it takes away a judge’s ability to correct mistakes in foreclosure cases. And, Weidner said, the legislature’s proposal ignores the root problem of the backlog.
“Existing laws in Florida and the existing judicial process allow courts to process foreclosures quite efficiently,” he said. “The problem is the banks are not doing their jobs properly. The foreclosure crisis in this state is a crisis that the banks created.”
Sen. Darren Soto (D-Kissimmee) said, banks are purposely processing foreclosures slowly so they don’t flood the market with properties. Soto wrote a letter to Scott urging a veto, saying the bill would mark the biggest reduction in homeowner property rights in generations.
During debate on the Senate floor, he said, “And the innocent people we’re protecting? Hedge funds. Flippers. Foreign investors. These aren’t families buying these houses in foreclosure, they’re sophisticated investors that know the risks they have. But the people who are losing their houses. They are our constituents. They are Florida’s families.”
And it’s not just the legislature looking at how to reduce the foreclosure backlog. The Florida Supreme Court just announced a rule change allowing judges to designate state agents called magistrates for the sole purpose of reviewing foreclosure cases. Meanwhile, Scott’s office says, he’s reviewing Soto’s letter and the bill.