Fraud No Impediment to Foreclosure, Florida Lawmakers Decide

Legislation passed Friday in Florida “prevents a homeowner who loses a foreclosure case from recovering the property, even if the bank’s actions are later determined to be fraudulent,” the Sarasota Herald-Tribune reports.

An estimated 352,890 foreclosures are languishing in the court system statewide.

Republican state Sen. Nancy Detert has little sympathy for homeowners caught in the fraudulent robo-signing scandal. Although banks committed wrongs in falsifying foreclosure documents, she says, they did so only in cases in which homeowners were already behind on their mortgage payments.

“People are victims of fraud, the fraud was the bank robo signing, but those people were already in default on their loans so they had not made their payments,” Detert said. There was no indication in the article published by the Herald-Tribune that Detert believed banks should be punished for fraud.

The state Senate approved the bill 26-13, largely on a party line vote.

The measure was passed in the context of a housing market that many experts allege is improving nationally. But recent reporting showed the real estate comeback is largely attributable to banks (rather than consumers) buying up homes and selectively stalling foreclosures.

— Posted by Alexander Reed Kelly.