In comparison with 2011's figures, which shows 85,000 completed foreclosures in March, the report is hopeful for homeowners facing foreclosure in Florida and across the country. In fact, the national mortgage delinquency rate is at its lowest level since 2009.
]]> An executive with CoreLogic explained, "Compared to a year ago, the number of completed foreclosures has slowed. Since the foreclosure inventory is also coming down, this suggests that loan modifications, short sales, deeds-in-lieu are increasingly being used as an alternative to foreclosures to clear distressed assets in our communities."The CoreLogic report also revealed that Florida was one of five states that collectively accounted for nearly half of all foreclosures in the U.S. between March 2011 and March 2012. Florida saw 92,000 foreclosures during this period, the second most in the nation. Florida saw the nation's highest foreclosure rate, with 12.1 percent of all mortgaged homes in the state being in some phase of foreclosure.
Nationwide, about 3.4 percent of all residential mortgages were under foreclosure, totaling 1.4 million homes. This represents no change from February. However, the figures mark a 6 percent drop from March 2011, when 1.5 million homes were in foreclosure.
The ratio of foreclosure sales to completed foreclosures rose between February and March, with 81 foreclosed properties being sold for every 100 finalized foreclosures in March. In February, about 76 foreclosed properties were sold for every 100 completed foreclosures.
While many in Florida are gaining their financial footing once again, for many others, once the ball has been rolling it just continues to gain in speed. Mounting credit card debt along with mortgage payments coupled with employment struggles is difficult for anyone. Some individuals at risk for losing their home may qualify for a mortgage modification through many of the new government plans.
It is worth the time to contact a professional to guide you through your options.
Source: MortgageLoan.com, "Foreclosures Pick Up Slightly," Kara Johnson, May 2, 2012
]]>While unemployment, medical issues and other financial problems have contributed to this increase, experts say that much of the uptick is an effect of the robo-signing scandal.
]]> When it was discovered that major banks in Florida and across the U.S. were signing foreclosure paperwork without properly verifying ownership and other information, lenders temporarily halted foreclosures until the issue could be resolved. This reduced foreclosure activity in 2011 significantly, but the recent settlement between the nation's largest banks and many state governments has caused the foreclosures that piled up during that period to move forward again, pushing up the foreclosure rate in Florida and elsewhere.RealtyTrac's CEO called the increased foreclosure rates in Florida and other states "an early sign that long-dormant foreclosures are coming out of hibernation in many local markets."
Still, Florida's foreclosure rates stand in contrast to the national trend. According to the RealtyTrac report, national foreclosures were down 16 percent in Q1 of 2012 compared to the same period in 2011.
Meanwhile, the Miami metro area's foreclosure activity increased about 37 percent. That area's foreclosure rate was the 13th highest in the nation, with one in every 95 housing units entering foreclosure during 2012's first quarter. Orlando saw the 15th highest foreclosure rate, with one in every 101 homes being served with a [foreclosure notice]. This is an increase of more than 52 percent compared to 2011.
The Palm Bay-Melbourne-Titusville metro area saw the state's largest increase compared to Q1 of 2011, largely due to unemployment following the termination of the Space Shuttle program. In that area, one in every 117 residential properties entered foreclosure, marking a gigantic 148 percent year-over-year increase.
Source: The Current, "Robo-signing fallout continues as Florida metros post foreclosure increases," April 26, 2012
]]>He had signed a $36 million contract with the Buccaneers and a deal worth even more with the Oakland Raiders. All together, he netted $77 million during his career. However, the former football great recently filed for Chapter 7 bankruptcy.
]]> The 59-page packet of paperwork filed in his bankruptcy case showed that Sapp had less than $1,000 in each his savings and checking accounts. What's even more shocking is that his debt still tips the scales at $6.7 million. These creditors include everyone from his ex-wife, four women with whom he has children, the IRS, banks, lawyers and even friends that agreed to loan him money.Many might be left wondering how Sapp qualifies for Chapter 7 bankruptcy, especially considering he still makes about $115,881 a month due to a number of ventures, such as serving as an analyst for the NFL Network. In time, the court will decide whether he can continue on this path. One thing is for sure, according to legal experts, given the large amount of debt, Chapter 13 bankruptcy is out of the question for Sapp.
The former football player argued that his debts are mostly business debt, shown in the fact that he has no credit card debt or debt from auto loans.
This was also seen in his bankruptcy filing which shows a costly venture that failed. Sapp was attempting to build affordable housing in Fort Pierce, partnering with Urban Solutions Group in the effort. The real estate market began to tank and PNC Bank sued the operation and won a $988,691.99 judgment. This financially crippled Sapp and his bankruptcy attorney said the judgment almost single-handedly tossed him into bankruptcy.
Source: Tampa Bay Times, "The play-by-play of Warren Sapp's 59-page bankruptcy filing," Michael Kruse, April 15, 2012
]]>As a whole, Florida saw a year-over-year increase in foreclosures of 58 percent, contradicting a national trend of decreasing foreclosures compared to 2011. However, the U.S. did see a 10 percent increase in foreclosures from February, with foreclosures rising by 13 percent in Florida during the same period of time.
]]> An analyst with RealtyTrac predicted that Florida would continue to see year-over-year increases in foreclosures, but said monthly foreclosure changes will likely remain unstable and difficult to predict. He explained, "There's only a certain capacity that states can handle, and I think we'll hit a plateau in Florida. But there is still backlog that needs to be pushed through."RealtyTrac's report aligned with similar data from the Palm Beach County Clerk of Courts, which reported that foreclosure filings saw a 65 percent uptick compared to March 2011 and a 25 percent increase from February 2012.
A Florida-based economic analyst predicted that the foreclosure crisis will not end in Florida until the state's large backlog of foreclosures are cleared and sold.
Another mortgage industry expert said that lenders will likely be aggressive in their attempt to reduce the backlog since the foreclosure crisis was particularly hard on states with judicial foreclosures, such as Florida. "Basically last year was a lost year from a foreclosure standpoint. Everything was on hold,"
said the expert. He explained that the recent landmark $25 billion foreclosure settlement could likely prompt a sudden increase in foreclosure filings.
Sources: LoanSafe.org, "Foreclosures, Repos Up From Last Year in South Florida," Alex Ferreras, April 12, 2012
]]>An official with one counseling group called 2011 "an anomaly," predicting that 2012 will see an increased number of foreclosures over even 2010.
]]> He and other experts believe 2011's robo-signing scandal, in which many of the nation's largest banks were found to be using illegal foreclosure practices, has drastically slowed the foreclosure rate. They say that now that a settlement has been reached to resolve that issue, foreclosures are likely to see a prolonged increase. In fact, Lender Processing Services recently reported that nationwide foreclosure starts increased by about 28 percent in January.Watchdog organization 4closurefraud.org says it has evidence of a large increase in foreclosures in March by three large lenders in Palm Beach County. Florida remains one of the most extreme casualties of the housing crisis. While more detailed information is not yet available, many experts believe these localized instances could be signaling a much larger wave of foreclosures that would affect homeowners in many states.
Foreclosure listing website RealtyTrac issued a report in which it revealed foreclosures rose in 21 states between January and February, also growing compared to January 2011. Foreclosures also saw a sharp uptick in several large metro areas, including Florida cities like Tampa and Miami, which saw respective foreclosure increases of 64 and 53 percent. RealtyTrac's CEO also predicted a "gradually rising foreclosure tide as some of the barriers that have been holding back foreclosures are removed."
Soure: Chicago Tribune, "Americans brace for next foreclosure wave," Nick Carey, April 4, 2012
]]>In theory, selling foreclosed homes and helping homeowners facing foreclosure become current on their mortgage loans should improve the economy's recovery. This is primarily why analysts issue monthly reports on foreclosure sales, foreclosure notices and the number of homes repossessed by lenders. While such figures are important in judging the health of the housing markets in Fort Lauderdale or elsewhere in Florida, experts say the reality of the foreclosure crisis is more complicated than it appears.
]]> Homes known as "shadow inventory" significantly affect the housing market in ways that are not captured in many analytical reports. These properties are generally homes that have begun the foreclosure process but have not yet entered the market for sale. While analysts disagree on the relative importance of shadow inventory, most agree that knowledge of their effects is necessary to fully evaluate the housing crisis and make plans for recovery.Even when shadow inventory is taken into account, it is still impossible to calculate the duration of the crisis with certainty. One Florida expert who was partly responsible for revealing the infamous robo-signing scandal cautioned homeowners against assuming the crisis is ending.
One woman who checks on distressed properties for banks and lenders said that the foreclosure crisis is "not going to be better for years." She argues that the truth about shadow inventory and other similar factors is "not out yet."
Source: USA Today, "Depths of foreclosure crisis difficult to measure," April 1, 2012
]]>While this data means fewer homeowners are forced to default on their mortgages, Florida courts have found themselves still struggling as a result of the foreclosure crisis. Because courts took in fewer foreclosure filing fees in the last two years, they were forced to seek emergency funds totaling $19 million in 2010 and close to $100 million in 2011.
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Florida lawmakers eventually decided to change how courts collect revenue, just three years after determining that courts should take their money from Florida's general revenue fund; which differs from the way courts in most states are budgeted.
However, legislators avoided subjecting the courts to budget cuts. Slightly more money has already been allocated to pay for Florida's judges and their staff for 2012-13 than in the previous year.
In order to better protect courts from the effects of foreclosure, lawmakers included an additional $20 million in the state budget to cover a potential funding gap and an extra $4 million to help courts work through Florida's large backlog of dormant foreclosure cases, currently totaling over 368,000.
The new changes will see courts taking 75 percent of their funding from general revenue, with the rest being generated by court fees. "We felt like 75 percent of their costs had to be paid no matter what. You've got to keep the judge employed. You've got to have a bailiff. You've got to have a court reporter," explained one state lawmaker. All foreclosure filings the courts collect will be sent to the state's general revenue.
Source: Palm Beach Post, "Florida foreclosure crisis hits courts hard too, not just homeowners, real estate agents and banks," Dara Kam, March 26, 2012
]]>The state has guarantees from Bank of American, JPMorgan Chase and Wells Fargo for $4 billion, $3.1 billion of which will be used to modify loans and reduce principals for Florida homeowners facing foreclosure. An additional $309 million has been allocated for refinancing for homeowners who are current on mortgage payments but have loans that exceed the values of the homes.
]]> If the banks fail to meet these guarantees, they will likely face harsh penalties. "We are one of the states on the monitoring committee, and we will ensure that banks comply with this agreement and that they are held accountable," said Florida's Attorney General.The Attorney General explained that Florida will use approximately $334 million to help fund programs aimed at foreclosure prevention as well as provide civil penalties. Another $171 million will be distributed to homeowners who lost their homes. This money is intended to serve as partial compensation for the improper foreclosure practices at the center of the landmark settlement.
Some critics have spoken out against the settlement, saying the relief it provides is insufficient to properly repay those who suffered due to the lenders' illegal practices. The settlement allows for up to $2,000 to be distributed to borrowers who lost their homes to such abuses and an average of $20,000 to be spent on principal reductions on "mishandled" mortgage loans.
Nationally, the settlement will provide borrowers with at least $20 billion in aid, primarily in the form of loan modifications and principal decreases. The settlement also saw the nation's five largest lenders agreeing to pay $750 million to the federal U.S. Government and $4.9 billion to the 49 states involved in the deal, as well as the District of Columbia.
Source: LoanSafe.org, "Florida to Get at Least $8 Billion in Settlement With Mortgage Lenders, Officials Say," Alex Ferreras, March 13, 2012
]]>One Florida foreclosure expert said that owners of expensive properties can more likely afford to employ a larger legal team. "They have more options," she explained. Additionally, such homes represent high maintenance costs for the lenders repossessing them, generally in the form of homeowners' association fees and property taxes.
]]> Lenders are also often more willing to negotiate with holders of large mortgages; as such individuals generally have more total assets and can more easily recover from financial difficulty. Additionally, expensive mortgages are not protected by government insurance. This means that lenders may not collect payouts from the government when such properties go delinquent; making them less attractive targets for foreclosure. Even if banks were to repossess these homes, doing so would require them to show larger losses.Since 2008, Florida's bay area has seen the sale of 32,429 properties. Only 26 of these sold for $1 million or more. The most expensive foreclosed home to sell in the area went for $2.6 million and took 13 months to complete the foreclosure process.
The extended time requirement associated with expensive mortgages is further increased by Florida's backlog of delinquent home loans, the largest in the nation. In all, around 500,000 Florida homeowners who have failed to make mortgage payments in over 90 days have not been served foreclosure notices. This and other factors, help make Florida's repossession timelines one of the nation's longest.
However, the recent $26 billion settlement between states and lenders is expected to increase the speed of filings, possibly decreasing the size of Florida's backlog.
Source: Tampa Bay Times, "Florida mansions take longer to repossess," Mark Puente, March 11, 2012
]]>Critics of the bill said they fear it could "trample" on the rights of Florida homeowners facing foreclosure. In particular, the legislation's opponents took issue with a portion of the bill that would allow a court to conduct a special hearing aimed at speeding foreclosures.
]]> "Home ownership is the American dream," said one protestor. She added, "These homeowners feel that their rights are being diminished." Other protestors were equally outspoken, calling Florida's legislature "a sham" and accusing the voting panel of purposefully ignoring their concerns.The chairman of the Florida Senate Banking and Insurance Committee stressed that the bill would continue to be discussed on the legislature floor. "Quite frankly, we've got less than two weeks to go in session and I think this is legislation that this Legislature needs to address and advance," he said. Critics of the bill have accused the chairman of rushing the bill through without taking steps to address constituents' concerns.
Foreclosure is one of Florida's biggest problems, with one recent report showing the state to have approximately 25 percent of the United States' total foreclosures and about 14 percent of all the country's home foreclosures. Senators hope the newly-approved bill will improve Florida's housing market, but did acknowledge that the legislation does not represent a perfect solution.
Source: CBS News, "Fla. Senate panel clears foreclosure bill," James L. Rosica, Feb. 28, 2012
]]>The companies reportedly charged up-front fees from customers hoping to rescue their homes from foreclosure. Taking money in such a way is illegal as is, but investigators say the companies failed to provide the promised services anyway. Attempts to contact representatives for one of the companies were unsuccessful.
]]> Florida's Attorney General explained, "Any homeowner who seeks the help of a foreclosure-related rescue service and is asked for an up-front fee should report that business to out officer immediately." She explained that such a practice is in violation of Florida state law and stressed that her office would continue to "crack down" on the perpetrators of such scams.So far, the state of Florida has collected $59,000 in restitution, which is set to be distributed among 430 homeowners who claim they were duped by the scam. An investigation into the apparent scam found that the companies' owners reportedly charged customers up to $2,000 in up-front fees but never helped them avoid foreclosure. Individuals who believe they were affected by the scan have until mid-March to file a claim with the Florida Attorney General's Office. The filing should include proof of payment to one of the accused companies.
As part of the settlement returning lost money to the scam's victims, the owners of the accused companies will be permanently barred from offering foreclosure rescue, loan modification or similar services. The owners were arrested for allegedly defraud homeowners in another state in 2011 with a similar scam, but those charges did not appear to result in convictions.
Source: LoanSafe.org, "Some Consumers to Receive Restitution for Alleged Foreclosure Scam," Alex Ferreras, Feb. 21, 2012
]]>In a new report from the National Association of Consumer Bankruptcy Attorneys (NACBA), 81 percent of professionals report a rise in bankruptcy potential clients with large student loan balances. This may be particularly difficult because most consumers seeking bankruptcy relief do not get student loans cleared.
]]> "Take it from those of us on the frontline of economic distress in America: This could very well be the next debt bomb for the U.S. economy," stated the president of the NACBA, William Brewer.The president of this professional organization also said, "The amount of student borrowing crossed the $100 billion threshold for the first time in 2010 and total outstanding loans exceeded $1 trillion for the first time last year." These numbers suggest why student loan debt is a nationwide issue.
People who are leaving college with a degree also have some notable credit card debt in various credit card accounts. Recent laws that have targeted borrowers under the age of 21 have alleviated some of the credit card crunch in this age group.
What really needs to happen for both the credit card crunch and the student loan crunch to resolve is for more college graduates to find employment in what they are trained to do. Without job growth, more personal bankruptcies will continue in the young sector of the workforce.
Source: Business Insider, "Student loan debt forcing more borrowers into bankruptcy," Feb. 15, 2012
]]>While other states received only estimates of how much they would receive, Florida is guaranteed at least $4 billion to be issued in the form of refinances, loan modifications and principal reductions for Florida homeowners facing foreclosure. Additionally, the state will receive small cash awards to be distributed to some individuals who lost homes due to foreclosure. Although Florida's attorney general defended the settlement in early January, she refrained from signing the agreement until late in the deliberations. She explained, "We remained engaged in settlement discussions, but we were willing to do what it took to make sure Florida was treated fairly."
]]> In what is being called the largest joint federal and state settlement in the history of the United States, officials from 49 states met with representatives from some of the country's largest lenders in order to address accusations that banks around the country improperly and illegal processing thousands of foreclosures. The final settlement stipulates that the five mortgage services involved in the scandal will pay $5 billion to federal and state governments and provide $20 billion in mortgage relief for homeowners.The settlement still has its critics, with one attorney arguing that it still fails to appropriately hold lenders accountable for "document fraud issues". He also believes the banks should have been required to make more cash payouts. The attorney says that while the settlement will help many homeowners, he feels that it is only a partial solution for the national foreclosure crisis.
Source: Palm Beach Post, "Florida wins rare promise in landmark $8.4 billion foreclosure settlement," Kimberly Miller, Feb. 10, 2012
Occupy groups in Fort Lauderdale and elsewhere across the state have reportedly successfully intervened for homeowners facing foreclosure, including a couple who had their home foreclosed and were scheduled to be evicted after becoming delinquent on $27,000 in loan payments on their second mortgage. After dozens of supporters appeared at the home to support its owners, the couple's lender announced that it would "consider all viable options to help them avoid eviction." The couple's attorney credits the Occupy group's activism for helping to convince the bank to reconsider the couple's situation.
]]> One participant in the rallies, a 52-year-old woodworker, explained that the case represents a wide scale problem affecting hundreds of Florida homeowners. "This was a family trying to do the right thing, and they were being denied," he said.Another member of the movement explained the group's actions: "The only thing that works is public outrage and media exposure of bad practices by banks." The woman, a nurse, joined the movement after she narrowly avoided wrongful foreclosure on her house that she alleges was caused by illegal foreclosure practices by her lender.
The couple whose home was saved says that while they are glad that the threat of foreclosure has been avoided, they fear that they could still lose their home to foreclosure. She says that she and her husband may have been evicted if not for the help of Occupy Fort Lauderdale.
Source: Orlando Sun-Sentinel, "In South Florida, Occupy movement targets housing crisis," Mike Clary, Feb. 4, 2012
]]>In some cases, people also do not even realize that they are in dire financial straits, and continue on with their spending and saving behaviors for quite some time, until they are deep in debt.
]]> For example, if every single month you find yourself overdrawing on your checking account, this could mean one of two things: Either you are spending more than you earn, or you are just spending too much money. This could be tied to being unemployed, or just not making enough for your necessary bills.Another tell-tale sign of financial danger up ahead, is if you are picking and choosing which bills to pay because you cannot pay both at the same time. Of course, with the current strained economy this may occasionally happen. But, if this is happening month after month, you may need financial help.
Lastly, do you have an emergency fund? If the answer is no -- or the fund is very small -- you can be in real danger if a life emergency or sudden health issue arises. Typically, the advice is to have an emergency fund of at least six months of income, but some experts say a whole years worth of savings is even better.
In the end, if you are reading this and realize that you fall into some of these categories, and are going deeper and deeper into debt; know that you are not alone. In fact, according to the American Bankruptcy Institute, from September 2010 through September 2011, there were 1.47 million bankruptcies filed in the U.S.
Because of this, if you are in a tough financial situation, don't just handle this alone. Instead, contact a bankruptcy attorney to see what debt relief options may be available.
Source: Yahoo Finance!, "5 Red Flags That Show You're in Financial Trouble," Brian O'Connell, Jan. 18, 2012
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