Thursday, March 7, 2013

Different perspectives on foreclosures could hurt association bill's chances.

Yesterday, a bill designed to speed up stalled bank foreclosure actions filed by Representative Kathleen Passidomo ( a Republican from Naples,FL) was debated at length in the House Justice Appropriations Committee. The bill did pass out of this committee by a vote of 9 to 2 but only after much emotional testimony that clouded the real issues at times.
The individuals who spoke in opposition of the bill did so from the perspective of folks who had previously lost a property to foreclosure. While it usually tugs at the heartstrings to hear of people losing homes as a result of their inability to make their mortgage payments, one could be equally sympathetic to the folks who continue to pay and now must pay more to make up for often significant shortfalls in their association's budgets. Some of those still-paying folks have one foot on the foreclosure path themselves if relief doesn't arrive in time.
The individuals who testified yesterday in opposition also did not seem to understand the significance of the bill's provisions which would shorten the amount of time that banks can pursue deficiency judgments from the current five years to one year! Instead, the focus was that Pep. Passidomo's bill would force banks to move their foreclosures forward expeditiously, a result that is soundly applauded by most people in the community association industry, including the writer of this blog!
A mortgage defense attorney testified that her own home was the subject of a foreclosure action which seemed odd in terms of being compelling testimony against this bill. Many delinquent owners have managed to stave off bank foreclosure actions for years as a result of the bank's own shoddy housekeeping or as a result of missing or flawed loan documents. However, at some point the bank usually overcomes those hurdles and then the owner must pay or leave.
What most opponents missed yesterday was the concept of this bill addressing the greater good. The fact remains that speeding up bank foreclosures will help struggling associations and the majority of people living in them. The folks that are displaced as a result will hopefully eventually own again with a mortgage which they are capable of paying. 

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