TALLAHASSEE, FL-- Fed up with foreclosure filings bogging down the state’s court system Florida Supreme Court Justices are using the bench to fight the problem.
The high court formed a foreclosure task force and is recommending changes to the way lenders and borrowers handle mortgage defaults. Mandatory mediation for homesteaded properties is one recommendation.
“To participate they would have to go through the foreclosure counseling," said Florida Supreme Court Justice Barbara Pariente.
Greenacres State Senator Dave Aronberg is sponsoring similar legislation that would allow down and out borrowers to reduce their payments. “A homeowner could stay in the home, pay a little bit each month and the bank would have a lien towards the end, so the homeowner would still owe the amount. There’s not free lunch here."
But for homeowners who have lost their jobs and are out of cash, mediation would simply delay the inevitable.
The Florida Bankers Association says mandatory mediation could bog down the courts even more. Bankers say borrowers should have a choice.
“I think they should be treated like the grownups that they are and allow them to say 'yes I want to do this and I’ll put a reasonable amount of money into the process' or 'no I don’t want to do this because it’s just not worth it to me,' ” said Virginia Townes of the Florida Bankers Association.
The justices are still considering an opt out option for borrowers who have given up on saving their property.
Still hanging in limbo is the question of who will pay for the bulk of mediation which costs an estimated 750 dollars. Some say the lenders should foot the bill, others suggest a 50 – 50 split.
