Much misinformation has been written in the blogs (much of it intentional) about my foreclosure bill (House Bill 213) that passed in a bipartisan vote in the House Judiciary Committee last week and was referred to in L.N. Ingram III's letter to the editor Friday.
I would like to set the record straight. Without commenting on the patronizing and downright nasty tone of Ingram's letter, H.B. 213 does not contain any provision (to quote him) "that if a bank wrongfully forecloses a mortgage, and homeowners wrongfully lose their home in the foreclosure sale, they cannot get the foreclosure sale set aside, but may merely be awarded monetary damages."
The bill contains four key components:
1. Much has been written about the defective documents that have been filed in foreclosure cases over the past several years. In order to put a stop to this practice, the bill sets forth specific requirements of lenders when a foreclosure complaint is filed and requires them to file accurate and complete paperwork at the outset of a foreclosure action or the complaint will be dismissed.
2. Florida law currently contains provisions known as "order to show cause" which allows only the lender to request the court to review the pleadings and issue an order to the defendant to "show cause" why a judgment should not be entered. In this bill, if the defendant fails to respond within 45 days (current law is 20 days), the case moves on to final judgment. If the defendant responds and files a meritorious defense as determined by the judge, the case will be heard by the judge. This bill allows any lienholder (including condominium or homeowners associations) to also ask the court to hold a "show cause" hearing. This provision is critical to condo and homeowners associations which may be owed thousands of dollars in unpaid assessments while the foreclosure case is stalled in the court by a lender that does not want to move the case along.
3. Currently, after a foreclosure or short sale is completed, the lender has a period of five years to pursue a deficiency judgment against the borrower. This bill reduces that time to 1 year, thereby allowing the borrower to get on with his life without having the added burden of worrying if the lender is going to sue him for a deficiency two, three, four or five years later.
4. The bill contains an expedited procedure only for abandoned residential property and contains procedures for determining when property is abandoned. Right now, abandoned homes have become sore spots in communities with overgrown lawns, broken windows, trash and debris accumulated, unpaid assessments and fees and, worst of all, they have become ridden with mold and mildew and are havens for criminal activity.
Since I filed H.B. 213 last fall I have met with, spoken with and corresponded with several hundred attorneys (representing borrowers, lenders and lienholders), members of the public, advocacy groups and borrowers in foreclosure. From those comments and public testimony heard during the committee process, the bill was revised at least a dozen times to take into consideration those comments and testimony.
I appreciate the opportunity to provide correct information on H.B. 213 and would invite anyone to review the final version of the bill, which can be found on the Florida House of Representatives website.
P.S. — I have lived in Naples since 1979 and have no intention of moving to New Jersey, as Ingram suggests.