A bill has been introduced in the Florida State Senate that would give lienholders more rights in the case of a residential foreclosure.
Florida H.B. 471, proposed by State Senator Jay Fant, a former Chairman and CEO with First Guaranty Bank & Trust Company, “Authorizes certain lienholders to use certain documents as admission in action to foreclose mortgage; provides that submission of certain documents in foreclosure action creates certain presumptions; authorizes lienholder to make request for judicial notice,” according to the language of the bill.
The bill authorizes a lienholder to use any documents from the mortgagee’s bankruptcy case that indicates an intention by the defendant to surrender the property. If the defendant does not withdraw the document in question, that document submitted along with a bankruptcy discharge, “creates a rebuttable presumption that the defendant has: 1. Surrendered to the lienholder the defendant's interest in the mortgaged property; and 2. Waived any defenses to the foreclosure.”
The defendant’s legal recourse in such a case includes “raising a defense based upon the lienholder's conduct subsequent to the filing of the document filed in the bankruptcy case that evidenced the defendant's intention to surrender the mortgaged property to the lienholder.”
The bill was filed with the House in Florida on Tuesday, January 24, and would go into effect on July 1, 2017, if it passes.
Morgan Weinstein, Attorney with Florida-based Van Ness Law Firm, said the language of the H.B. 471 may prove to be problematic.
Florida was one of the states hit hardest by the foreclosure crisis, though the rate at which foreclosures are being completed has declined substantially over the last few years. For the 12-month period ending November 30, 2016, there were approximately 48,000 residential foreclosures completed in Florida, compared with 83,000 for the 12-month period ending November 30, 2015, according to data from CoreLogic.
Click here to view the full text of Florida H.B. 471.