January 10, 2014

This is a very common scenario: After years of foreclosure litigation, a bank and a homeowner reach a truce.  Motivated by the very favorable terms of various national mortgage settlements, the bank agrees to a short sale.  The bank and the homeowner notify the court that they have reached an agreement and need 45 days to complete the closing so a new family can purchase the home, and the homeowners can finally walk away without having a substantial deficiency judgment follow them for years.

Then the litigants call the court to mutually request a delay of a court-ordered sale, because the more beneficial settlement has been reached.  But what are the litigants told by the judicial assistant responsible for scheduling?  They are told, “The judge will not allow any extension. The forced sale cannot be stopped.”

In any courts except foreclosure courts, this would never happen.  Judges would allow the mutually beneficial settlement.  But foreclosure courts have long had their own rules, and most often those rules harm homeowners.  Who will step forward to protect the homeowners?  Joseph Smith, who is supposed to be in charge of overseeing the settlement?  The feds or attorneys general who negotiated the settlements?  The Chief Judges? The Consumer Protection Fraud Bureau?

So far, the answer is “None of the Above.”  And so, in Palm Beach County, a 79 year-old homeowner who worked out a short sale with the agreement of JP Morgan Chase, will lose her home on February 6, 2014 to a foreclosure auction, in case 502010CA017857.

This is not an isolated incident, but certainly the most egregious conduct by local judges, in a long series of egregious conduct.

Please print this article and fax it with your comments to Joseph Smith, Florida Attorney General Pam Bondi and to the CPFB. Please ask them to step up and protect the modifications and short sales that the litigants want to achieve.