| 1 | A bill to be entitled |
| 2 | An act relating to foreclosure debt relief; providing |
| 3 | a short title; providing definitions; authorizing the |
| 4 | creation and administration of a deficiency judgment |
| 5 | reimbursement program by the Florida Housing Finance |
| 6 | Corporation contingent upon the occurrence of certain |
| 7 | conditions precedent; providing for future termination |
| 8 | of the program; authorizing continuation of the |
| 9 | program under certain circumstances after depletion of |
| 10 | funds; providing procedures and eligibility |
| 11 | requirements for homeowners and financial institutions |
| 12 | to file specified monetary claims; providing an |
| 13 | effective date. |
| 14 |
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| 15 | Be It Enacted by the Legislature of the State of Florida: |
| 16 |
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| 17 | Section 1. Deficiency judgment reimbursement program.- |
| 18 | (1) This section may be cited as the "Foreclosure Debt |
| 19 | Claims Act." |
| 20 | (2) As used in this section, the term: |
| 21 | (a) "Deficiency" means the total amount owed by an |
| 22 | eligible homeowner to a participating financial institution as |
| 23 | determined by a court at a hearing on a motion for summary |
| 24 | judgment in a foreclosure action. |
| 25 | (b) "Eligible homeowner" means an owner who purchased |
| 26 | homestead property between January 1, 2004, and December 31, |
| 27 | 2008, inclusive, and whose homestead property is subject to a |
| 28 | foreclosure action brought by a participating financial |
| 29 | institution. |
| 30 | (c) "Foreclosure action" means a foreclosure action filed |
| 31 | in a court of this state. |
| 32 | (d) "Fund" means the moneys, or the account containing the |
| 33 | moneys, allocated by the United States Department of Treasury |
| 34 | from the Housing Finance Agency Innovation Fund for the Hardest- |
| 35 | Hit Housing Markets to the Florida Housing Finance Corporation. |
| 36 | (e) "Homestead property" means real property determined by |
| 37 | a court having jurisdiction over a foreclosure action brought by |
| 38 | a participating financial institution to be the primary |
| 39 | residence of the defendant homeowner based upon the totality of |
| 40 | circumstances. |
| 41 | (f) "Participating financial institution" means any |
| 42 | financial institution that: |
| 43 | 1. Is authorized to engage in lending activities in this |
| 44 | state; |
| 45 | 2. Holds a mortgage subject to a foreclosure action |
| 46 | against an eligible homeowner; and |
| 47 | 3. Has voluntarily agreed to participate in the program. |
| 48 | (g) "Program" means the deficiency judgment reimbursement |
| 49 | program created and administered by the Florida Housing Finance |
| 50 | Corporation in accordance with this section. |
| 51 | (3) Contingent upon the United States Department of the |
| 52 | Treasury authorizing and directing the Florida Housing Finance |
| 53 | Corporation to create and administer the deficiency judgment |
| 54 | reimbursement program as provided for in this section and upon |
| 55 | receiving a minimum of $100 million from the Housing Finance |
| 56 | Agency Innovation Fund for the Hardest-Hit Housing Markets, the |
| 57 | corporation shall: |
| 58 | (a) Create the deficiency judgment reimbursement program |
| 59 | in compliance with both the provisions of this section and the |
| 60 | directive given by the United States Department of the Treasury |
| 61 | for the creation and administration of the program. |
| 62 | (b) Create all the notices and forms necessary for the |
| 63 | administration of the program. |
| 64 | (c) Process filed claims in the order received and pay |
| 65 | claims until the fund is depleted or the program is continued |
| 66 | pursuant to subsection (4). |
| 67 | (d) If program funds are depleted before the scheduled |
| 68 | termination of the program, notify all participating financial |
| 69 | institutions about such depletion, unless the program is |
| 70 | continued pursuant to subsection (4). |
| 71 | (4) Any program created pursuant to this section shall |
| 72 | terminate 1 year after the receipt of the funds required under |
| 73 | subsection (3). However, if the funds are depleted before the |
| 74 | scheduled termination of the program, the program may be |
| 75 | continued until the scheduled termination date, subject to an |
| 76 | appropriation by the Legislature, for the purpose of paying any |
| 77 | pending claims filed before the depletion of funds. |
| 78 | (5) An eligible homeowner is entitled to receive a waiver |
| 79 | of deficiency from a participating financial institution and up |
| 80 | to $1,000 in moving expenses from the fund if the eligible |
| 81 | homeowner agrees in writing to: |
| 82 | (a) Settle the foreclosure action by entry of a |
| 83 | nonmonetary judgment of foreclosure against the eligible |
| 84 | homeowner; and |
| 85 | (b) Vacate the homestead property within 3 months after |
| 86 | entry of judgment against the eligible homeowner or the judicial |
| 87 | sale, whichever occurs later. |
| 88 |
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| 89 | An agreement under this subsection is valid only if it is in |
| 90 | writing. |
| 91 | (6) A participating financial institution is entitled to |
| 92 | file a claim with the Florida Housing Finance Corporation for an |
| 93 | amount equal to 10 percent of the deficiency arising from a |
| 94 | foreclosure action settled as a result of a written agreement |
| 95 | entered into by a participating financial institution and an |
| 96 | eligible homeowner pursuant to subsection (5). |
| 97 | Section 2. This act shall take effect upon becoming a law. |