TALLAHASSEE -- Florida lawmakers sent Gov. Rick Scott a bill Friday that is aimed at speeding up the residential mortgage foreclosure process in a state where the real estate market went into a tailspin during the national housing crisis.
Supporters of the measure (HB 87) said they hope it will help ease a foreclosure backlog and rejuvenate the vast housing sector.
"I don't think our real estate market will really start getting back to normal in Florida with new home building ... until we can reduce this backlog," said Sen. Jack Latvala, R-Clearwater.
The bill cleared the Senate on a 26-13 vote on the final day of the Legislature's 60-day session. It passed the House recently 87-26.
It wasn't immediately clear whether Scott supports the measure. A spokesman for the governor said Friday that the bill was being reviewed.
Latvala said the bill would make overdue improvements to the foreclosure process. It would make banks prove in more detail that they own a mortgage or explain why they can't prove ownership. It also creates a process for others besides mortgage-holders to ask the court to speed up foreclosure cases.
Sen. Darren Soto, D-Orlando, was the most outspoken critic, saying the bill chips away at long-established property rights and fails to protect Floridians who lose their homes due to fraud.
Latvala said the bill has safeguards that tilt more in favor of consumers than banks.
Florida was one of the states hardest hit by the national collapse in the real estate market that began in 2008. Foreclosure cases quickly swamped an already overworked court system.
One key provision would reduce from five years to one year the amount of time for banks to go after foreclosed homeowners on deficiency judgments. Deficiencies are the difference between the money obtained from selling a foreclosed home and what the original homeowner still owes on it.
Soto said he was told by a judge recently that the mortgage case backlog isn't a result of state law, but is a calculated move by banks to keep foreclosed properties from glutting the market, which would collapse housing prices. "So what we're going to see here is, we're going to reduce property rights ... that have been on the books for generations and it's not even going to work," he said. "This isn't a legacy that I want to leave."
The number of U.S. homes repossessed by lenders last month fell to the lowest level in more than five years. While some states saw increases in homes taken back by banks, home repossessions fell 3 percent nationally in March from the previous month.