Sen. Aronberg, other lawmakers fire back at bank-backed foreclosure proposal

Article Courtesy of The Palm Beach Post

By Dara Kam

Published February 12, 2010

The bank-backed move to speed up foreclosures has agitated Democrats fighting back in the Legislature.

State Sen. Dave Aronberg and Rep. Darren Soto are proposing a "Foreclosure Bill of Rights" in opposition to a yet-to-be filed measure that would let mortgage lenders get their properties back without giving homeowners their day in court.

And the battle puts Senate President Jeff Atwater, a North Palm Beach banker, and other lawmakers in a sticky spot with more than 500,000 Florida homes now in the foreclosure process.

Condo and homeowners' associations complain that they're losing out on dues because of the backlog of foreclosure proceedings in the courts, which can take up to two years or more to complete.

But in an election year in a state with unemployment in the double-digits and climbing, the expedited process pushed by the Florida Bankers' Association could be a hard sell.

"Imagine here you are asking public policy makers to consider accelerating someone's loss of their home," said Atwater, R-North Palm Beach, who is running statewide for chief financial officer. "I think that's going to be a very tender spot to go."

Already under fire for federal bail-outs and being blamed for an economy in ruins, the bankers have their work cut out for them.

Aronberg, a lawyer who is running statewide for attorney general, said the bankers' proposal "pushed him over the edge" and says it defies Floridians' constitutional right to due process in the courts.

Aronberg, D-Greenacres, blames the foreclosure rate on "large institutions that helped create this economic crisis through their own reckless behavior and in some cases fraudulent behavior." His district runs from Palm Beach County across the state to Lee County, which has the second highest foreclosure rate in the nation last year.

Aronberg's bill would keep foreclosures in the judicial system, require mediation and allow lenders to put a lien on the property in foreclosure if its value is less than the amount of the mortgage. It would only apply to homesteaded property owners who reside in their homes.

Rep. Tom Grady, also a lawyer, is considering filing a bill that would speed up the process in cases where foreclosure is inevitable but he said he is mindful of the constitutional issues involved.

"I don't want to do anything to take away from the ability of a homeowner to present a real defense in a real court of law," said Grady, R-Naples.

And, he said, he wants to make sure that homeowners aren't left on the hook if they owe more on their mortgage than their home is worth.

"Where this can be done and it doesn't deprive a homesteaded borrower of their day in court, I'd like to try to explore that and make that happen. I think that is good for borrowers and good for condo associations. And I'd like to see if we can do that," Grady said.

The bankers say they're getting hammered by the associations who say they're not moving fast enough.

"These are inevitable. You have homeowners screaming at us saying, 'Foreclose now. I want this eyesore out of my neighborhood,'" said Alex Sanchez, president of the Florida Bankers Association. "We're getting hit by every side. Our bankers are working to keep Florida families in their homes.

But if eight months go by and you can't work something out ..."

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