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Florida's Foreclosure Disorder

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By : Karim El Sheikh    99 or more times read
In what appears to be a growing trend in Florida, more foreclosure judges are denying claims made by banks and awarding the defendant (home owner) rights to the house. Judges, fed up with mismanaged or faulty paperwork concerning foreclosures are dismissing cases and imposing restraining orders against the lenders from filing against the defendant again. It is a trend that is growing, and has many concerned.

Lawyers for the lenders are speaking out against this trend, stating that judges do not have the authority to defend people in their courts. They state that a judge only has the authority to rule on the validity of the case. However, many judges are stating that they are, in fact, doing just that. One of the leading judges in the South Florida area stated that she could not effectively decide a case if the paperwork was not in order. She went on further to state that if she ruled on a foreclosure that had no proof it was valid, than she herself would be violating the law.

Florida suffers from very high foreclosure rates. Second only to California, Florida has been hit very hard by the housing crash. Foreclosures take an average of 22 months to make it into a courtroom in the state, making it one of the most back logged states in the country. Last year, in an effort to move these pending cases along, Florida courts were given a grant to bring in retired judges and open up temporary court buildings to help clear their docket.

Currently in Florida the State Attorney, Federal Bureau of Investigations (FBI) and the Bar Association have been investigating the foreclosure process in the state. What they have found is a plethora of mismanaged cases, forged signatures, robo-signed paperwork and lost documents. It seems like the entire system is in shambles. The media has been actively reporting on this disaster and advocacy groups have cropped up to help distressed home owners. Defense attorneys are fighting back, disputing claims by the lenders, and they are beginning to win.

At the beginning of the foreclosure crisis banks were never questioned. It was just assumed that they had credible reason to file a foreclosure. Now, after so many scandals have erupted, judges are questioning the banks. However, a judge is not able to do this for uncontested foreclosures. A judge can only review a case that is defended, not work as an advocate to a home owner.

David J. Stern, an attorney credited with running Florida’s largest “foreclosure mill,” has decided to fight back against the judges. He sent a letter out to 20 Circuit Court judges in Florida informing them that he intended to violate Florida court rules if this did not stop. How will he violate the court rules? By dumping another 100,000 foreclosure cases into the system at one time, overwhelming the courts and forcing dockets to be cleared without proper review.

Analysts from around the country are keeping a close eye on the events taking place in Florida. Many are cheering on the judges that are standing up for the state constitutions they are sworn to uphold. “These judges are doing what they were placed into office to do,” commented one law professor. Others are worried that the trend will catch on in other states, slowing down the foreclosure process even more, and delaying any recovery in the housing market.

Still other legal analysts believe that these actions by the judges will force banks and loan servicing companies into better business practices. If lenders are forced to prepare paperwork correctly and have all supporting documentation before entering the court, they may be more inclined to find alternatives to foreclosure. Many lenders and servicing companies have found in the past that a quick foreclosure was much easier than negotiating a loan modification. Perhaps by changing the ease with which they can file, they will opt for working with the home owner.
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