Posts Tagged ‘foreclosure process Florida’
Posted on April 16th, 2012 by Mark Stopa
Below is a well-written, informative article by Kim Miller of the Palm Beach Post, illustrating how 7,000 foreclosure cases lie dormant in Palm Beach County alone. Make sure you comment on Kim’s article, and be sure to let her know you particularly like the quotes from me. 
The zombie files: Nearly 7,000 stagnating foreclosure cases lie dormant in Palm Beach County’s courts
Nearly 7,000 stagnating foreclosure cases lie dormant in Palm Beach County’s courts, creating a payment-free limbo for some homeowners but a stain of vacant and abandoned homes in deteriorating neighborhoods.
These sleeper files, which have remained inactive for a year or longer, date as far back as 1997, according to documents provided to The Palm Beach Post by the clerk of courts.
But most are from the early years of the housing crash when lenders feverishly sought to repossess homes, unaware that the frenetic pace would cause a second crisis based on faulty documents and unlawful corner-cutting.
While an unknown number of dormant files are mistakes, such as one party forgetting to request a dismissal after an agreement is reached, others remain open but unmoving because of homeowner bankruptcy, loan modification negotiations or bank neglect.
“I have no idea what’s going on and I’m not pushing it,” said Robert Feinson, a Jupiter resident whose case has sat idle since November 2010, more than two years after his lender initially filed for foreclosure against him. “Right now, we’re just waiting to see who is going to make the next move.”
The 6,927 zombie files make up about 17 percent of Palm Beach County’s 39,252 foreclosure cases.
The banks with the largest number of dormant cases include Bank of America (670), JPMorgan Chase (602) and Deutsche Bank (546).
After 10 months of inaction, a homeowner, or the court itself, can seek a dismissal of the foreclosure based on non-prosecution . If the bank fails to react within 60 days, the case can be thrown out and the bank forced to start over.
It’s a move Palm Beach County Chief Judge Peter Blanc said might begin in earnest this summer after a one-time bump in state funding allows him to hire additional judges to tackle foreclosures and get rid of “deadwood.”
The last court-initiated weeding-out occurred two years ago when Blanc received $640,000 to add judges, he said.
“There’s a whole variety of reasons why cases were dismissed, which is sort of consistent with how the practice was all over the place in the early years,” Blanc said.
The frustration over stalled and prolonged cases can be heard in Palm Beach County Judge John Hoy’s foreclosure court.
This month, Hoy waved a calendar at bank attorneys who had missed deadlines or sought to cancel foreclosure sales for reasons such as a failure to publish the auction announcement or belief that a loan modification was in the works.
Often the claim that a short sale or loan modification is pending comes after a final foreclosure judgment is made as banks backpedal on rulings.
“This is a 2009 case,” Hoy said to one lender attorney who was seeking an extension of time. “If you can’t take care of your old cases, don’t file new ones. ”
On another foreclosure, which was filed in January 2008, Hoy was equally nonplussed.
“There are 111 docket entries in this case and we’re still screwing around on a motion to dismiss?” he asked the attorneys. “What’s going on around here?”
When the lender’s attorney couldn’t produce an endorsed note proving ownership, Hoy dismissed the case.
“I kicked them back just now to January 2008,” said foreclosure defense attorney Malcolm Harrison after Hoy’s decision. “You’ll find a lot more errors on these older cases because they didn’t know what they were doing.”
Harrison hopes the “fatal flaw” in the bank’s case will force it to modify his client’s mortgage instead of refiling the foreclosure. The homeowners have been living in their Olympia home in Wellington without making a payment for about four years.
The reasons cases may be delayed are myriad, said Guy Cecala, publisher of the trade publication Inside Mortgage Finance. They include:
- Fear of flooding the market with distressed properties that will crash prices.
- Concern over getting a clear chain of title.
- Unwillingness to take on maintenance and liability for a property.
- Negotiating a loan modification or short sale.
- A homeowner files for bankruptcy, putting the case on hold.
- Problems with paperwork or how a previous law firm handled a file.
After the collapse of the Plantation-based Law Offices of David J. Stern in March 2011, about 100,000 foreclosure cases statewide needed to be transferred to new attorneys.
Tampa-area defense attorney Mark Stopa said he didn’t have a hearing or trial set by a bank on any of his foreclosure cases in a year.
Stopa said he was able to get between 30 and 40 cases dismissed in the past six months because of lack of prosecution.
“That’s something I love to take advantage of, and in years past, the courts would do it on their own,” he said. “It’s a good way to clear dockets that is favorable to homeowners.”
Feinson, the Jupiter homeowner, said he tried to get a loan modification after losing his business, but found himself dealing with a revolving door of lenders and servicers. His loan traveled from LIME Financial Services to La Salle Bank to Wilshire and finally to Bank of America, he said.
The last action on his case was an unsuccessful mediation in late 2010, just when the problems with robo-signing were revealed.
“We don’t know who has the mortgage and no one seems to have any answers,” Feinson said.
Forgotten foreclosures may see a reanimation of activity following the $25 billion settlement between the nation’s largest banks and the states’ attorneys general, Stopa said.
The agreement, announced in February, requires banks to modify more home loans and outlines a standardized way to process foreclosures.
Whether the settlement is good news for homeowner Kathryn Siddons, also of Jupiter, remains to be seen. Her home has been in foreclosure since 2008 with the last action on her file taken in the fall of 2010.
But she’s also been working on a loan modification, she said.
“We got a letter two years ago saying they couldn’t find our original note and we could work on other options,” Siddons said. “I just keep reapplying (for a loan modification). I’m afraid not to because then you’re just giving up.”
Mark Stopa
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Posted on July 29th, 2011 by Mark Stopa
Read this post, courtesy of our friends at www.4closurefraud.org, and you be the judge.
Is New Director of Bondi’s Economic Crimes Division, Richard “DICK” Lawson, Defending Lender Processing Services & the Foreclosure Mills?
Lawson told the News Service on Wednesday that he did indeed ask about those two companies, after their lawyers expressed concerns about the way Edwards and Clarkson were handling the cases – and, in particular about a public presentation the two gave in a public forum that gave their “impressions and theories” about the Lender Processing Services, and characterized certain companies as foreclosure mills.
So, it sounds like LPS didn’t like these ladies poking around and the poor wittle foreclosure mills were offended by their characterizations…
Guess that didn’t sit well with ‘DICK’ for some reason. Wonder what that reason was?
He was hired by Pam Bondi shortly after she came into office btw… Hmmm…
Just so you all know, the presentation that “DICK” is referring to, as Barry Ritholtz puts it, as yeoman’s work, is the UNFAIR, DECEPTIVE AND UNCONSCIONABLE ACTS IN FORECLOSURE CASES report that was created, presented and praised under the previous administration.
I even got word that June and Theresa actually got an award for their groundbreaking work that was presented to the “public” at the December conference of the Florida Association of Court Clerks and Comptrollers by the attorney general’s economic crimes division.
The certain “companies” that they categorized as “Foreclosure Mills” that “DICK” is referring to are The “Law Offices” of David J. Stern, Shapiro $ Fishman, Marshall C. Watson, The Florida Default Law Group, Ben-Ezra Katz, Kahane, Consuegra, Albertelli, etc…
Oh my, slanderous… /sarcasm.
Okay folks, their true colors are starting to show here.
This is why you never react with emotion, because when you do, you fail…
Quotes from the New Director of Bondi’s Economic Crimes Division Richard “DICK” Lawson on Fraudclosuregate…
But first, the latest comment from Blondi…
“The decision that supervisors made to end the employment of these two employees, like every decision made in my office, was made based on sound policy and responsible management,” she wrote. “Any suggestion otherwise is both unfounded and offensive.”
Yea, sound policy and responsible management, right…
Now the latest from DICK Lawson…
Richard Lawson, the director of Bondi’s Economic Crimes Office, said that he had met with the women three times in their South Florida office to discuss his problems with their work. However, there is no documentation of these meetings, and their annual performance reviews for the past few years were complimentary. Edwards’ direct supervisor, Bob Julian, said in an interim evaluation in April that “I cannot overstate the degree to which I respect Ms. Edwards and her work with this unit.”
Lawson said Wednesday that his first meeting with the two women was shortly after he’d started his job last spring, so he did not believe the meeting warranted formal paperwork. He also said that he was unsure why Julian did not also see problems with their work.
Okay, two things here…
One, this guy comes aboard not knowing a thing about foreclosuregate, (we met with him for about an hour in March after he claims of this meeting with June & Theresa and he still had no clue) and criticizes something he knows nothing about shortly after he started? Really?
Try harder there DICK. No pun intended…
Two, I think we should all be concerned for Clarkson’s and Edward’s previous supervisor Bill Julian with the way DICK is trying to discredit his opinion of these ladies…
He also said that he was unsure why Julian did not also see problems with their work.
I hope Bob’s job is now not in jeopardy.
To continue…
Lawson also denied that the office was easing up on Lender Processing Services, a Jacksonville firm that recently hired Joe Jacquot, a lawyer from Bondi’s office who was a holdover from former Attorney General Bill McCollum‘s office. Edwards and Clarkson had said publicly that Lawson had questioned them extensively about the firm.
Lawson said he and several assistant attorneys general from other states had met with LPS about their practices a day before the first story on Edwards and Clarkson broke and that he was “frustrated” by accusations that the office was easing up on its investigations.
So, this guy, Joe Jacquot, was hired by LPS the same week that June and Theresa were fired. His new position, Senior Vice President of Government Affairs for Lender Processing Services, Inc.
WOW, talk about a coincidence. Go from an office that is investigating LPS for fraud to its Senior Vice President of Government Affairs for Lender Processing Services, Inc. What a lucky guy!
From LPS’ web site. (You can’t make this stuff up folks!)
As Senior Vice President, Government Affairs, for Lender Processing Services (LPS), Joe Jacquot provides leadership and strategic oversight of LPS’ legislative, political, advocacy and other public affairs activities. Joe is responsible for analyzing and responding to pending legislation and regulation affecting LPS; identifying legal, policy and operational issues for LPS; and building effective relationships with internal and external partners, including government officials and industry professional associations.
But wait, it gets better…
DICK doesn’t know when to stop…
Edwards and Clarkson said publicly in newspaper stories that their boss, Richard Lawson, who heads up the economic crimes division in Bondi’s office, questioned them extensively about two mortgage processors that are under investigation by the office, Jacksonville-based Lender Processing Services and Tampa-based ProVest.
Lawson told the News Service on Wednesday that he did indeed ask about those two companies, after their lawyers expressed concerns about the way Edwards and Clarkson were handling the cases – and, in particular about a public presentation the two gave in a public forum that gave their “impressions and theories” about the Lender Processing Services, and characterized certain companies as foreclosure mills.
Poor wittle LPS, Provest and the foreclosure mills…
I don’t know what else can be further presented to characterize these “impressions and theories” as criminal intent and felonies…
And, the “certain companies” ARE Foreclosure Mills. How else would you define them?
Fraud is fraud and it is rampant. How can you deny it?
If any one of the homeowners did anything remotely close to what these fraudsters have done they would be in jail. Do not pass go, do not collect $200, directly to jail.
Anyway, we will close this one out with Bondi’s final quote of the day…
Bondi, who was one of several politicians who got “small” campaign donations from Lender Processing Services last year, also released a lengthy statement on the growing controversy on Wednesday.
“The most important directives I have given to the Division of Economic Crimes have been to increase its efforts to pursue foreclosure law firm investigations and to protect consumers,” Bondi said in the statement. “I am proud that based on my direction, we are more aggressively pursuing foreclosure law firm investigations and have substantially increased the amount of time and more than doubled the number of employees working on these investigations. From 2009 to 2010, 1,300 hours were spent on these investigations. From April to July 2011, more than 1,500 hours have been spent on these investigations….
“The two employees who were given the option of resigning or being terminated were failing to meet expectations, and they were held accountable for those shortcomings,” Bondi wrote.
Well if that’s the case, we should be seeing some fines levied, some criminal prosecutions initiated and some bar licenses lost.
Right Pam? Because if two investigators were able to accomplish the amount of work that they did in a year, or about 1300 hours, the new “investigators” should have something out this week if they spent more time and efforts than June and Theresa did over the last 3 months or 1,500 hours than J&T spent over the last year…
If not, we will speculate why…
Is it not true that you think homeowners are a “moral hazard” that can simply take advantage of their lender? Must, protect, the banks…
“Some homeowners may simply default on their loan and use the States’ agreement to obtain a principal reduction — whether or not they actually made an effort to maintain their mortgage,” wrote Bondi, who serves on the negotiating group’s executive board.
She called it a potential “moral hazard” that “rewards those who simply choose not to pay their mortgage — because they can simply take advantage of lenders‘ obligation to honor virtually automatic principal write-downs.”
Oh, yea. I almost forgot…
If you want to contact DICK Lawson and tell him how supportive you are of him and his new fraudclosure team, you can contact him through the methods below…
Richard “Dick” Lawson
Director Economic Crimes Division
Office of the Attorney General
State of Florida
PL-01, The Capitol
Tallahassee, Florida 32399-1050
Ph: (850) 414-3300
Fax: (850) 488-1249
[email protected]
But don’t don’t be disappointed if you do not get a response. We have sent numerous requests to his new fraudclosure “investigators” on who is monitoring and enforcing the Marshall C. Watson “settlement agreement,” in which it appears to have ongoing violations and have received no responses at the time of this posting…
Mark Stopa
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Posted on April 20th, 2011 by Mark Stopa
I recently had a hearing on a Motion to Quash Service. The Plaintiff was unable to serve my client via personal service, i.e. a process server hand-delivering the Summons and Complaint, see Fla. Stat. 48.031, so it resorted to service of process by publication. This is where a plaintiff can follow statutory procedures to effectuate service on a defendant through the Secretary of State.
There were several problems, any one of which required that service be quashed.
First, by including a request for a deficiency judgment in its Complaint, Plaintiff was seeking monetary relief, and Florida law does not authorize service of process by publication in cases where the plaintiff seeks monetary relief. See Fla. Stat. 49.011; see also Huguenor v. Huguenor, 420 So. 2d 344 (Fla. 5th DCA 1982) (“The action here is one for money damages based on the tort of conversion. It is simply not the type of action where service may be obtained by publication.”).
Second, Plaintiff contended my client had evaded service, but failed to so allege in the body of its Complaint. This failure requires that service be quashed. See Monaco v. Nealon, 810 So. 2d 1084 (Fla. 4th 2002); Drake v. Scharlau, 353 So. 2d 961 (Fla. 2d DCA 1978).
When I argued this second principle of law, the judge found it difficult to believe – “How can a plaintiff allege evasion of service in the Complaint?” This is a fair criticism, particularly since a plaintiff would have no way to know a defendant will evade service when it drafts the Complaint. However, the law requires this, and the requirements for service by publication are strictly construed, so this requirement must be followed. As I told the judge, it’s not as hard as one might think – the plaintiff just needs to file an Amended Complaint.
Third, my client did not evade service; the plaintiff resorted to service by publication too quickly. To illustrate, the process server went to my client’s property on just six different occasions, and he easily could have not been home. Also, the process server left a business card, and my client called and offered to cooperate, but by that point was told the process server no longer had the paperwork.
When I made the third argument, the judge appropriately wondered whether an evidentiary hearing was required to resolve the factual dispute. I told him it was necessary to resolve the factual dispute on that issue, i.e. whether my client evaded service, but the motion should be granted for both of the first two reasons (which required that the motion be granted regardless of anything else).
I also asked for a stay pending appeal, as in the event the court ruled against me, I was entitled to seek appellate review and have the case stayed while I did. (And, yes, there is case law on this as well.)
The plaintiff’s attorney realized he was getting destroyed in the arguments. Hence, before the judge could rule, he offered to waive deficiency if my client agreed to have the motion to quash service be denied. His thought process made sense, sort of – if service by publication was not authorized in cases that seek monetary relief, as I argued, the plaintiff could cure the problem (or that problem, anyway), by striking the request for monetary relief. It was as if the lawyer was saying “we struck the request for monetary relief, so now service by publication was okay.”
The judge asked if I agreed to this request. When I said I’d need to speak to my client, he stopped the hearing to allow me to do so. My client agreed, and I hand-wrote an Order, to which the other side agreed and the judge signed, saying:
The motion to quash service is denied. Plaintiff’s request for a deficiency judgment and monetary relief is stricken with prejudice. This is an in rem proceeding only, and Plaintiff is entitled to no relief against Defendant.
Perhaps my favorite part about this episode, aside from the fact that the deficiency was stricken with prejudice (meaning it cannot be pursued ever again) is that the case is still not over; in fact, my client’s Motion to Dismiss is still pending. In other words, my client is still able to defend the foreclosure case on the merits, and continue living in his home while he does, without risk of a money judgment against him.
This sounds like an impossibly good result, but I can see this scenario unfolding again. So make sure you challenge service of process by publication. Make sure you point out that deficiency judgments are unavailable if process is served by publication. It wouldn’t surprise me if the plaintiff agrees to waive/strike the claim for deficiency to try to avoid more headaches with deficient service of process (particularly if you request a stay pending appeal, as that will lawfully throw a huge monkey wrench into any attempts to move the foreclosure suit forward).
Mark Stopa
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Posted on January 21st, 2011 by Mark Stopa
Foreclosure defense attorney Mark Stopa and a client of the firm were profiled today on Bay News 9 (Tampa’s NBC affiliate). Here is a video version of the story; the written version is below.
What should you take from this? Easy. Fight your foreclosure. Don’t give up. You may be able to improve your situation drastically if you retain a competent foreclosure defense lawyer to defend your foreclosure case.
ST. PETERSBURG –
Susan Reboyras has lived in her St. Petersburg home for nearly eight years but she hasn’t paid her mortgage in nearly two. “When the boom was high, we thought it was going to stay high, and we pulled equity out,” Reboyras said.
Reboyras and her fiancé run A-Plus Restorations out of the home. When the economy stalled, they made a decision. “We had to decide were we going to make the payments,” Reboyras said, “or were we going to continue with advertising to bring money in the door to keep the business going so we could make payments.”
Many are in the same situation all across the state. According to data from LPS Applied Analytics, the average is 677 days before a house in foreclosure is sold and the homeowners kicked out. It’s one of the highest totals in the country.
Foreclosure defense attorney Mark Stopa said more homeowners in foreclosure should fight it. “Don’t just give up and walk away. Defend and fight your case and save up your money,” Stopa said.
Stopa said foreclosed homeowners staying in their home benefits the community more than if the bank was in control of the home.
“Time and time again, these banks, even when they get that foreclosure judgment, they don’t actually set the sale,” Stopa said. “What results is this lengthy period of limbo where the homeowner has lost and they’re scared into leaving, but the bank doesn’t take the title, so the property sits vacant for months, sometimes years.”
In Reboyras’s case, she believes she made the right decision for her family. “Right now, we’re self-sustaining, she said. “Yeah, we’re not making the mortgage payments but it’s going to a means that keeps us from the government supporting us.”
Mark Stopa
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Posted on December 29th, 2010 by Mark Stopa
Florida’s Second District Court of Appeal issued a very significant ruling today that helps frame the arguments for many foreclosure cases in Florida. Here’s the backdrop …
A Hillsborough County judge appropriately dismissed a foreclosure lawsuit because the bank lacked standing to sue. Having prevailed in the lawsuit, the defendant moved for attorneys’ fees under Fla. Stat. 57.105, asserting the bank and its lawyers knew or should have known the lawsuit lacked the requisite legal or factual support. In layman’s terms, the defendant alleged the lawsuit was frivolous, and since the bank’s lawyers knew it, the lawyers and the bank should pay the defendant’s attorney’s fees. When the Hillsborough judge denied a fee award, the defendant appealed.
The Second District reversed the Hillsborough judge’s order, finding the lawsuit was frivolous and the defendant should have been awarded attorneys’ fees (from the bank and the bank’s lawyers). Why is this so significant? Well, it’s not easy to get attorneys’ fees against a lawyer as a sanction. Fla. Stat. 57.105 sets forth the circumstances where it can happen, but judges (who are lawyers themselves) typically don’t like awarding sanctions under the statute.
The point here, though, isn’t about attorneys’ fees. The point is that the Second District is saying that certain legal principles in foreclosure cases are so well-established that the banks and their lawyers subject themselves to sanctions if they contend otherwise. This is earth-shattering news because, candidly, these are arguments that Florida foreclosure defense attorneys make on a regular basis.
The fact pattern in this case was one I see often. The bank filed suit for foreclosure and to re-establish a lost note. As the case progressed, the bank could not prove it was the owner or holder of the Note. The note was lost (and hence not in the bank’s possession), and an Assignment of Mortgage had not been recorded in the Hillsborough County Public Records as of the date the Complaint was filed. Essentially, the bank could not prove it had standing to foreclose as of the date the lawsuit was filed. In the words of the Second District:
Because J.P. Morgan did not own or possess the note and mortgage when it filed its lawsuit, it lacked standing to maintain the foreclosure action. See Bank of N.Y. v. Williams, 979 So. 2d 347, 347 (Fla. 1st DCA 2008); Jeff-Ray Corp. v. Jacobson, 566 So. 2d 885, 886 (Fla. 4th DCA 1990). It follows that when J.P. Morgan filed its mortgage foreclosure action, it knew or should have known that its action was unsupported by the material facts necessary to establish the claim.
Based on these facts, the Second District concluded not only that the foreclosure lawsuit was appropriately dismissed, but that the bank and its lawyers were deserving of sanctions, i.e. payment of attorneys’ fees to the defendant! This is huge news, so much so that it will impact my arguments in court on a daily basis. Now, every time I have a case with this fact-pattern (and I have many), I’m going to tell the presiding judge not only that dismissal is required for lack of standing, but that the law is so well-established in this regard that appellate courts have required sanctions for the bank filing the suit in the first place. Again, the point isn’t about sanctions or attorneys’ fees, but to make judges realize that the law in this arena is clear, and foreclosures can’t happen upon such facts. I assure you – judges will open their eyes when they realize an appellate court issued sanctions against a lawyer.
So what are the facts? Well, this is the fact-pattern I’ll be looking for: (1) a foreclosure lawsuit where plaintiff is not the original mortgage holder; (2) no assignment of mortgage as of the date the suit was filed; and (3) no indorsement to plaintiff/indorsement in blank as of the date the suit was filed. When presented with such a fact pattern, Florida courts should – no, *must* – dismiss foreclosure lawsuits.
One note – notice how the Second District emphasized the bank’s lack of standing “when it filed its lawsuit”? This is no coincidence. There is a well-established line of cases holding that a plaintiff cannot acquire standing to foreclose after filing suit. Hence, if the plaintiff obtained an indorsement/assignment after the suit was filed, and did not have the indorsement/assignment beforehand, dismissal is still required, even if the original note is in thecourt file. The Second District did not explicitly say dismissal is required even if the original note is in the file, but that’s what they mean when they talk about the bank not having standing “when it filed the lawsuit.” It doesn’t matter if the note shows up afterwards – it matters if the bank had the note when it filed suit.
Mark Stopa
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Posted on December 24th, 2010 by Mark Stopa
The title of this blog is not my verbiage – it’s the title of the most recent media article that criticizes how judges are handling foreclosure lawsuits in Florida. The article concentrates heavily on the perverse foreclosure procedures and rulings in Lee County, including the premature “docket soundings” that I’ve blogged about previously.
I encourage you to read the entire article, but here’s a good synopsis of the total apathy exhibited by some Florida judges in foreclosure cases. One Fort Myers judge, when confronted with a motion by the bank to temporarily suspend a foreclosure case because it was questioned the accuracy of its own filings, denied the motion!
Think about that. This was one of the rare instances where a bank tried to clean up its misconduct, and halt a foreclosure while it evaluated the propriety of its actions, yet the judge basically said “I don’t care – just finish the foreclosure.”
Respectfully, some judges need the judicial canons by which they are bound.
Canon 1 – A Judge Shall Uphold the Integrity and Independence of the Judiciary
Canon 2 – A Judge Shall Avoid Impropriety and the Appearance of Impropriety in all of the Judge’s Activities
Canon 3 – A Judge Shall Perform the Duties of Judicial Office Impartially and Diligently
Canon 4 – A Judge May Engage in Activities to Improve the Law, the Legal System and the Administration of Justice
Canon 5 – A Judge Shall Regulate Extrajudicial Activities to Minimize the Risk of Conflict With Judicial Duties
Canon 6 – Fiscal Matters of a Judge Shall be Conducted in a Manner that does not Give the Appearance of Influence or Impropriety; etc.
Canon 7 – A Judge or Candidate for Judicial Office Shall Refrain from Inappropriate Political Activity
Mark Stopa
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Posted on November 26th, 2010 by Mark Stopa
Kimberly Miller of the Palm Beach Post has been on top of the emerging foreclosure stories as any reporter in the country. Here’s her article today on how Fannie and Freddie have resumed foreclosure sales, essentially ignoring the pervasive fraud and title problems with which we’ve become all too accustomed. …
By Kimberly Miller; Palm Beach Post Staff Writer
Fannie Mae and Freddie Mac gave the go-ahead this week to restart sales of their foreclosed properties, which had been on hold since September when it was revealed that flawed or fraudulent court documents may have been used to repossess homes.
Brokers received memos Wednesday from the government-sponsored enterprises saying that the homes could once again be marketed and sales finalized on properties already under contract. Fannie Mae’s letter explains that evictions and lockouts are still suspended on its properties.
In South Florida, the move releases thousands of houses for sale that were removed from the market earlier this fall, leaving buyers and Realtors in limbo.
Brokers were encouraged in Fannie’s letter to contact buyers who chose to cancel delayed contracts to see if they are still interested. “I’ve already sent e-mails to clients who opted out,” said Bill Richardson, managing broker for the Keyes Company in Boca Raton and president of the Realtors Association of the Palm Beaches. “I had numerous people put on hold, and some of them canceled because it was very uncertain when the auditing process would be done.”
A Lake Worth broker said she received a similar memo from Freddie Mac on Wednesday, but a Freddie spokesman said he could not confirm it today because too many people were off for the Thanksgiving holiday.
Amy Bonitatibus, spokeswoman for Fannie Mae, said the decision to move forward with the sales was made after a review of property acquisitions, including those handled by the Plantation-based foreclosure firm of David J. Stern.
Fannie Mae and Freddie cut ties with the firm last month after former employees, one of whom had been fired, gave sworn statements to state investigators about wrongdoing at the company such as forged signatures on foreclosure documents and the hiding of flawed files from auditors. The Stern firm is one of four so-called “foreclosure mills” in Florida under investigation by the state attorney general’s office.
“Fannie Mae remains committed to ensuring that borrowers are treated fairly in accordance with the legal process and to allowing new homebuyers to close on transactions in a timely manner,” Bonitatibus said.
But some homeowner advocates said there are still too many unanswered questions about whether foreclosures have been handled legally. Concerns about obtaining a clear title are legitimate, said Tampa-based foreclosure defense attorney Mark Stopa.
The foreclosure paperwork problems already have led at least one former homeowner to challenge his foreclosure in Pinellas County. The man’s home, repossessed in 2008 by Bank of America, has since been sold to a family who has had to hire an attorney to defend their title to the property.
“There are still legitimate questions about the validity of title to these homes,” Stopa said. “Unfortunately, too few people in positions of authority care. The fraud is there and we all know it, but too many people think it’s easier or better to ignore it than fix it.”
Fannie Mae and Freddie Mac own or guarantee about half of all U.S. mortgages, or 31 million home loans worth more than $5 trillion. About 12 percent of Fannie Mae loans in Florida are delinquent, while Freddie Mac has 17 percent of its Florida mortgages in arrears.
The embargo on selling foreclosed properties likely added to last month’s slump of existing home sales, which dropped 12 percent in Florida compared to September and 21 percent compared to October 2009.
Mark Stopa
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Posted on November 22nd, 2010 by Mark Stopa
This article is disturbing on a number of levels. Wells Fargo foreclosed on a home, then sold it to a third party, and only then did the buyers find the original homeowner, in the garage, deceased – apparently for a long time. Before you write that off as “just one of those things,” consider this quote from the neighbor of the deceased woman:
‘The main thing I think is sad about it is that somebody could have their house foreclosed on and sold out from under them and they’re still dead inside the house. I just think that’s pretty inhumane, and it certainly says we need to change this process somehow, reach out to people a little better than that. At least make sure they’re alive before you sell their house.’
I couldn’t have said it better myself.
Mark Stopa
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