Bill to Simplify Processing of Bank and Government Foreclosures Filed
A legislative bill aimed at simplifying the processing of bank and government foreclosures has been filed in Florida. The measure is also designed to provide protections to homeowners and clear the confusion often associated with foreclosures. A number of market analysts have praised the measure and expressed belief that it will help address challenges concerning foreclosure processing.
According to industry analysts, the rise in the number of distressed homes in Tampa and foreclosure properties in the rest of Florida is partly due to the breakdown in the procedure used by foreclosing entities such as banks and mortgage servicers and also due to lack of proper state laws. The recently filed measure is reportedly meant to serve as an alternative procedure to foreclosure, with its use dependent on the consent of both homeowner and lender.
The bill can also apply to abandoned distressed properties in Florida and to properties whose assessed values have gone down by 150% below the mortgage loan amount. The proposal is being seen by supporters as a way to assist the state's court system which has been overloaded with foreclosure-related cases. One of its provisions will require the entity filing the foreclosure action to provide a mortgage loan note, sources have said.
Processing of bank and government foreclosures can take several months, with some cases even running for years. Part of the reason for the long time is the confusing steps involved in foreclosures, analysts stated. There is also the matter of multiple entities or companies claiming ownership of the loan, causing delays and errors in filing and processing. These are just some of the issues that the bill reportedly aims to address.
Another notable provision in the bill is the need for lenders to notify homeowners or tenants that they are facing the possibility of seeing their homes become distress properties for sale. Information about homeowner assistance and warnings about potential fraudulent foreclosure rescue schemes will also be required under the legislative bill. The measure has been described as quite complicated and might require a more thorough assessment and a longer time in various legislative committees.
Supporters of the proposal have stated that they are hoping that the bill will pass in time to prevent more homeowners from losing their properties to bank and government foreclosures. However, most of them predicted that it will likely take the legislature until next year to decide on the measure given the many provisions contained in it.
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