Experts: Lull in foreclosure filings temporary

MANATEE — Local foreclosure filings plunged last week, but experts — while disagreeing on the cause — say it’s only a temporary lull.

Lenders filed 65 foreclosure suits in Manatee County Circuit Court last week, including a low of five Tuesday, court records show. That’s the fewest since the short holiday week of Dec. 29 and marked the first time in 22 weeks that the number of filings didn’t crack triple digits.

Experts offered various reasons for the sudden drop, including higher filing fees and increased government efforts to stem the foreclosure crisis.

A state law that took effect Monday increased the cost to file a foreclosure suit from $295 to between $395 and $1,900, depending on the amount of the delinquent loan. As a result, lenders’ lawyers now have to file with foreclosures a detailed estimate of how much the borrowers owe.

Court clerks kicked back several foreclosure suits last week because they didn’t include the estimate or pay the higher fee, said Ruth Schay, civil supervisor.

“I think that’s kind of thrown them off,” she said. “The response that we got from the (law) firms was that they didn’t even know about the law.”

But others said they doubt the higher fees are the cause. “I don’t think the fees really matter to them,” said Dawn Bates-Buchanan of Gulf Coast Legal Services Inc. in Bradenton, who represents low-income homeowners facing foreclosure.

Instead, she said a recent court-ordered stay on foreclosure proceedings against Fannie Mae- and Freddie Mac-backed mortgages in South Carolina — which since has been lifted — likely had a chilling effect on filings nationwide. “The servicers don’t want to begin the process and end up not being able to sell the property,” she said.

Shari Olefson, a real-estate attorney in Fort Lauderdale, said recent changes to the federal Making Homes Affordable program also contributed to the filing pause. Lenders are holding back while they assess the changes, designed to make it easier for homeowners to arrange short sales or voluntarily give up the house to avoid foreclosure, she said.

Whatever the cause, experts don’t think the slowdown will last long. “I don’t really care why. I’m just glad they’ve slowed them down,” Bates-Buchanan said. “But we’re ultimately going to be right back where we were.”