Report: Florida Foreclosure Backlog Being Cleared, But at What Cost?

The latest report from RealtyTrac listing firm indicates the number of foreclosures in South Florida is down significantly over the last year.
window1.jpg
In January, it was reported January tallied nearly 900 home foreclosures, which was nearly double the 470 foreclosures reported the same month in 2014. Similarly in Palm Beach County, there were 517 foreclosures, which was an 11 percent increase from a year ago. During this same time too, we’re seeing an uptick in bank repossessions, which one Sun Sentinel reporter indicated was a “welcome sign,” indicating a growing number of distressed properties are are clearing the clogged court pipeline. As a representative of RealtyTrac put it, “The pig is moving through the python.”

Yes, cases are being cleared. But the question becomes: At what cost?

Part of the reason there was such a great backlog of foreclosures was because courts were attempting to handle each case according to the letter of the law, affording each homeowner with all applicable rights. That hasn’t exactly been happening since an initiative was implemented last year that involved explicit instructions form the state Supreme Court and Legislature to gut the system of old cases and clear the docket. Ironically, the initiative was funded by mortgage fund settlement money that was intended to help borrowers. Instead, according to a late 2014 report by the Center for Public Integrity, homeowners ended up getting steamrolled.

Essentially, the courts are more concerned with getting the cases out of the system rather than ensuring justice is served. That has meant significantly reducing the time it takes for a foreclosure to process, which means families struggling to hang onto their homes have found themselves out on the street far sooner and with less of an opportunity to fight back against the foreclosure. In turn, the banks are getting their properties back much sooner, which means they are spending less on legal fees and able to resell the houses sooner.

The person who loses, consistently, is the homeowner.

Our Miami foreclosure lawyers have seen that many state judicial and legislative leaders have essentially turned a blind eye to the ramifications of tossing thousands of families out of their homes and then getting those properties back in the hands of the banks. These banks have already done an awful job of maintaining vacant properties that have been foreclosed. Because the housing market is already swamped, none of these banks are in a hurry to sell these properties, which means many of them become neighborhood blights.

Banks have also become notorious for the existence of so-called “zombie foreclosures.” That is, allowing foreclosure filing to linger in the system – even after they’ve kicked the borrower out of the home – so that the unsuspecting borrower is still on the hook for any accruing code violation fines, homeowner association fees or taxes racked up between when the borrower left and when the bank actually decides to sell it.

In the meantime, a parallel legal system has been established in Florida specifically to deal with the backlog of foreclosures. In these courtrooms, judges can weigh up to 100 motions every single day. The express goal of these courts was to clear the system of 260,000 foreclosure cases annually.

So it’s not surprising that the latest report indicates the measure has succeeded in this regard. However, one must ask the price our courts have paid for this accomplishment.

If you’re battling foreclosure or debt collection in Miami or the surrounding areas contact Jacobs Keeley for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Tuesday at 6 p.m. on “Debt Warriors with Bruce Jacobs and Court Keeley,” discussing foreclosure topics that matter to YOU.

Additional Resources:
Home foreclosures finally clearing courts, Feb. 12, 2015, By Paul Owers, Sun Sentinel
More Blog Entries:
Deficiency Judgments Plaguing South Florida Foreclosure Victims, Sept. 3, 2014, Miami Foreclosure Lawyer Blog