After some skirmishing up in Tallahassee, representatives of the Florida House and the Florida Senate have aligned with Florida Attorney General Pam Bondi in a joint announcement this week which outlined Ms. Bondi’s plan on what to do with $300 million from the national Attorneys General – The Big Banks Foreclosure Fraud Settlement is now a done deal. Basically, the Florida Legislature isn’t going to fight Pam Bondi on what to do with the money.
Where Will the $300,000,000 Be Spent?
As for how that $300,000,000 will be distributed, according to Attorney General Pam Bondi, $60 million is tagged for helping people with down payments on homes, along with providing legal assistance and lawyers to those who cannot afford a foreclosure defense attorney, and another fistful, will go to helping the judicial system, with money going into the Florida Court system to help with the foreclosure lawsuit bottleneck. Some funds will be used by the Attorney General’s office in enforcing foreclosure laws.
After subtracting the $60 million from the total, $200 million will be spent on housing-related items as defined in the overall AG-Big Bank settlement agreement. That includes helping neighborhoods hard hit by foreclosures, helping with legal counseling, helping find affordable housing for people, programs for foreclosure prevention, and more housing-related services. Pam Bondi will have around $40 million of the settlement funds for additional civil penalties.
Larry Tolchinsky’s Tip:
This $300,000,000 has been sitting in an account waiting for decisions to be made on how it will be distributed since April. The Florida Legislature and the Florida Attorney General were in a battle over this cash — there was a legislative pull to get this money into the state budget, and there was even one legislative argument was that it should be used to get state employees a big raise (yes, really).
Pam Bondi has won her fight to keep this money on target to help the Florida Foreclosure Mess though around $40,000,000 will end up in the state budget for the Legislature to use.
As for when Floridians will actually see any help from this settlement chunk, well it’s not anytime soon. The Legislature will distribute the funds and they will not meet and approve distribution of these sums until next year – the money won’t be spent until Summer 2013. And this is an optimistic viewpoint.
Meanwhile, foreclosure lawsuits are being filed by banks here in Florida every day and with the December 2012 deadline for short sale income tax benefits drawing close, it’s not a big surprise that more and more Florida home owners facing foreclosure and in financial distress are filing bankruptcy. Reports are that there was a big jump in bankruptcy filings here in Florida last month (October 2012) with Broward County, Miami-Dade County, and Palm Beach County seeing a spike of 19% in one month’s time.
Bottom line: while the State of Florida ponders what to do with that settlement money, individual mortgage holders are on their own in deciding what is their best course of action. Bankruptcy? Strategic default? Negotiation with the bank? Short Sale? South Florida foreclosure defense attorneys can help people in all sorts of unique circumstances and right now, it’s the real estate lawyer that is the reality here — not the Tallahassee settlement proceeds. Most Florida real estate lawyers can help by offering creative legal fee structures, so mortgage home owners can afford to fight to keep their home and/or fight to protect their credit, future earnings, and their families well being.
Do you have questions or comments? Then please feel free to Chat with Larry in the comments below, at firstname.lastname@example.org, or (954) 458-8655. If you have a specific situation, please call or email Larry because he can’t answer specific fact questions in general comments. He’s happy to take your call.