Checks earmarked for thousands of Florida foreclosure victims are finally in the process of being sent out and hundreds of millions of additional dollars more are being earmarked for new housing programs statewide. Yet there is a growing debate about where most of the money is going and if foreclosure victims are really getting their fair share.
As it stands now, thousands of Florida families forced out of their homes by abusive foreclosure practices finally will be getting some money back. It is all part of a huge national settlement levied against some of the biggest banks in the country.
But it turns out that most of Florida’s money isn’t going to the victims.
With one of the country’s highest foreclosure rates, Florida got one of the largest cash settlements to close out a national investigation against some of the biggest banks nationwide. Some $8.4 billion in penalties was earmarked to settle allegations that thousands of Florida families were illegally thrown out of their homes by banks and mortgage companies due to faulty paperwork. Some of the money was used by the banks themselves to lower their customers’ monthly payments.
Last year, the state itself got more than $200 million for its own foreclosure relief programs. But it couldn’t decide how to spend it. That fund has now grown to $334 million and the Florida mortgage relief act was just signed into law. It gives millions of dollars to help families with down payment funds, rental assistance, homeless aid and neighborhood improvements. It also gives $73 million to the state’s general fund.
State lawmakers call it a great victory for homeowners.
“This money is going to help the homeless,” Florida Attorney General Pam Bondi explained. “It’s going to help housing for the elderly and disabled, and for neighborhood revitalization.”
But what about Florida foreclosure victims? Under the settlement, about 72,000 former Florida homeowners should each get checks for $1,480.
Still, it turns out that Florida is one of the last in the country to start distributing the foreclosure settlement funds. Critics question why it has taken so long to get the money to local families who lost their homes, and why they are not getting a bigger piece of the pie.
Weston foreclosure defense attorney Roy Oppenheim said millions will be going to the courts, and will actually help speed up future foreclosures statewide
“A lot of money is going to the court administrative process to speed the foreclosure process up even more… to fund the rocket dockets. It’s a complete and utter joke… for people illegally losing their home and for the destruction of the legal system.”
For now, there is no word out of Tallahassee as to when all the state’s other homeowner-assistance programs will kick in or how residents can apply for the hundreds of millions of dollars that are available.
Watch Al Sunshine’s “4 Money Watch” reports Monday-Friday. You may find Al’s blog at www.cbsmiami.com