Real Estate Journal Online

After state lawmakers opted not to renew a $6 million stipend intended to pay for the man(judge)power to reduce the state’s foreclosure backlog, Florida is once more facing a serious swamp when it comes to resolving its foreclosure issues. In fact, after the first of July, judges will be unavailable to preside over foreclosure hearings, Judge John Hoy, a Palm Beach County Circuit judge, announced last week[1]. Palm Beach received $640,000 of last year’s stipend to add senior judges, case managers and assistants to work on the massive foreclosure case load, which enabled the county to process nearly 17,000 foreclosure cases. However, that left the backlog in Palm Beach alone at more than 29,000 and the statewide backlog is still 139,615.

Some analysts and homeowner advocates believe that more time is exactly what is needed to resolve the backlog, arguing that loan modifications, short sales and “just going mortgage-free” will help homeowners deal with their delinquency issues. However, others fear that there will be a “situation where there will be a further deterioration of values of the properties so the challenge of rebuilding will be stalled and compounded,” as Fort Lauderdale attorney Gary Poliakoff explains. He compared the situation in Florida to a broken record in that the situation cannot resolve until the foreclosures are settled in court. Because Florida is a judicial foreclosure state, lenders cannot foreclosure on the property by publicizing the foreclosure and then carrying out an eviction, which would eliminate court hearings in many cases, such as abandoned properties.

Should Florida shell out an additional stipend? At the current rate and assuming no new foreclosures, it will take another two years and at least $12 million to eliminate the backlog.

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[1] http://www.palmbeachpost.com/money/foreclosures/fewer-judges-will-be-hearing-florida-foreclosures-as-1486058.html