Meanwhile, for those working with Florida home owners and Florida borrowers in the current South Florida real estate market, it’s not that rosy. Here’s why:
Proposed Legislation to Help Banks Not Borrowers with Home Foreclosures Moving Forward in Tallahassee
Things are cooking on the Florida Legislature Stovetop and those proposed bills to change current Florida Foreclosure law to let foreclosures happen faster are still bubbling away in their pots. This isn’t good news for Florida homeowners defending themselves against foreclosure by Florida banks; however, it’s nice to hear for lenders and those concerned about backlogs in the court system. Consider this:
1. House Bill (HB87) is moving forward “favorably” through the Committee process. As of yesterday afternoon, it had been added to the Second Reading Calendar and has made its way through the Civil Justice Committee, the Justice Appropriations Committee, and the Judiciary Committee to its current spot before the Appropriations Committee.
2. Senate Bill (SB 1666) likely is getting favorable consideration as it just got approved in a vote count of 6 yeas to 2 nays before the Florida Senate’s Judiciary Committee. It’s now before the Appropriations Committee.
Neither of these proposed new laws recognize the time that is needed by foreclosure defenses to mount a proper defense against lender-plaintiffs who all too often have screwy paperwork if not outright fraudulent documentation. Furthermore, where are the tools to punish wrongdoing in these matters? Not in these bills. Not even a hand-slap on banks who have done bad things.
For details on these two pieces of legislation, read our earlier post “Florida Legislature Annual Session Begins Today: Proposed Laws That Impact South Florida Home Owners In a Big Way Are on the Table.”
South Florida Continues to Lead the Nation in Foreclosures – a Growing Inventory of Homes on Bank Books
Out of the entire United States, not only does Florida lead the nation in foreclosure rates in 2013, according to studies performed by those in the know like the economists at RealtyTrac, but South Florida – and in particular, Miami – leads the Sunshine State in the number of homes foreclosed upon by lenders. We’re Number One, and not in a good way.
- Around ten days ago, the Miami Herald reported on this current economic reality in a story that not only highlighted the RealtyTrac numbers but discounted the impact of the elephant in the room, that big Shadow Inventory of homes setting on bank books right now.
- Meanwhile, there cannot be a foreclosure without the title to that property going somewhere: and as foreclosure numbers make records, that means that Shadow Inventory numbers are breaking records, too. These lenders are holding lots of property — and that property comes with duties like insurance and taxes and upkeep.
- In fact, the Palm Beach Post reports that there has been an 86% jump in the Miami Shadow Inventory from the first quarter of 2012 to the first quarter of 2013, with the State of Florida overall having an increase almost as big (82%). That’s a lot of homes.
How will that Shadow Inventory impact the Florida economy? As we’ve reported earlier, there are experts opining that it’s going to hold Florida’s economic recovery down until 2015 if not later.
Employment Rates Impact Housing Recovery Says Fannie Mae Ecomonist
The economy is a mishmash of lots of different things working together and the housing market in Florida doesn’t operate independently of other economic conditions. No news to those of us here, monitoring our personal budgets and planning for our kids’ college and our own retirement, right?
So it’s not news but it’s a good point to remember when Richard Koss, the director of mortgage market analysis at Fannie Mae is quoted from a speech he gave in Texas this week to a conference of bankers (mortgage servicers), that the number of people employed or underemployed directly influences the housing economy of South Florida.
- There needs to be people ready and willing and able to buy homes and to get mortgages. People need good and steady jobs to do this. Lenders need proof of the buyer’s ability to repay the mortgage before they can offer the home loan. Buyers need to have money each month to pay the mortgage and the insurance and the taxes.
- Right now, unemployment numbers are bad for the country. Reuters is reporting that March 2013 was the worst hiring month out of the past nine months.
- According to the Department of Labor, the national unemployment rate fell to 7.6% in March 2013. This, reports USA Today, is because almost half a million Americans (496,000) gave up trying to find a job. Bottom line, in March 2013, the number of working Americans was the lowest percentage in over 30 years (since 1979).
Larry Tolchinsky’s Tip: South Florida is hurting and will be hurting for the foreseeable future, that’s the reality. For Florida borrowers considering a short sale, or Florida home owners facing foreclosure, it’s important to understand the battlefield before entering into negotiations with their mortgage lender, or pricing their home for a quick sale to avoid foreclosure by the bank. It’s tough times and home owners need to be savvy more than ever before when making financial decisions about their real estate.
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 or personal situation, please call or email Larry because he can’t answer specific fact questions in general comments.
“I’m happy to take your call.”