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Floridians facing foreclosure could lose their homes faster under plan in Tallahassee

By Kathleen Haughney

Sun Sentinel

Updated: 9:01 a.m. Friday, Sept. 23, 2011

— Floridians facing foreclosure could be stripped of their homes faster and have routine access to the courts limited under a proposal likely to come before Gov. Rick Scott and the Legislature in the coming months.

Bankers see it as a speedy and efficient way to manage foreclosure cases and get tens of thousands of Florida properties in ownership limbo back on the market, helping pull the state out of its economic doldrums.

In contrast, foreclosure defense lawyers and consumer activists see the plan as removing judicial oversight from a system that has proven to be riddled with fraud and abuse, and leaving ordinary homeowners defenseless before some of the state's most powerful financial interests.

"Obviously there's a lot of fraud being perpetrated by the banks in these cases," said Michael Redman, a Palm Beach County resident who founded the Website to chronicle Florida's ongoing foreclosure crisis. "At this point in the game, it's almost ridiculous to take it out of the court system."

But the Florida Bankers Association, which has pushed the plan over the past few years, has key allies. Scott voiced support for the proposal at a Florida Bar convention this summer and told reporters Wednesday he is still interested in it. Some lawmakers have already jumped on board.

"Well, I want to make sure that we have an efficient process, so we don't create a reason for banks or whoever lends money not to lend money in Florida," Scott said. "When you talk to people that are in the system now they say it's 600 days to get through foreclosure. All that does is create another incentive for people to not lend money when we want people to lend money to our state.

"I don't know the answer yet, but I want to look at the process," Scott said. "I want to get more information before I make a decision."

According to RealtyTrac, a foreclosure tracking firm, Florida had the third highest foreclosure rate in the nation and was second in the number of foreclosure cases filed in 2010. On average, the firm said, the foreclosure process takes 676 days.

Usually the lender reclaims possession; other times, homeowners get to keep their property.

Currently, Florida is one of only 20 states to handle the foreclosure process through the courts. In California and Nevada, which have also been plagued by high foreclosure rates, foreclosure proceedings are primarily conducted outside court in about four months, though a judge can get involved if one of the parties deems it necessary.

Typically in states using a non-judicial system, the mortgage contract is based on a deed that includes a clause allowing banks to begin foreclosure proceedings without going to court. The bank gives notice to the homeowner and if the homeowner did not respond, the bank can reclaim the property.

Lawmakers and the Florida Bankers Association have pushed in the past for Florida to become a non-judicial foreclosure state but have come up short, with concerns about rampant fraud by some lending institutions trumping other arguments.

Legislation has not been filed yet this year on the issue, but legislative leaders in Tallahassee seem interested. Legislative economist Amy Baker gave a presentation on the issue this week to the House Civil Justice Subcommittee and Katie Betta, a spokeswoman for House Speaker Dean Cannon, said that Cannon, R-Winter Park, has said he is open to it, but cautioned that the "devil is in the details."


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