1

A bill to be entitled

2

An act relating to mortgage rescue fraud; providing a

3

short title; providing legislative findings and

4

declarations; providing intent and purposes; providing

5

definitions; providing requirements for foreclosure

6

consultant contracts; providing requirements for notices

7

of cancellation; providing for rescission of foreclosure

8

consultant contracts; providing requirements for

9

foreclosure conveyance contracts; providing for contract

10

terms; providing requirements for cancellation of

11

foreclosure conveyance contracts; providing requirements

12

for notices of cancellation; providing for

13

unenforceability of waivers of provisions of the act;

14

providing exceptions; specifying prohibited activities for

15

foreclosure consultants and foreclosure purchasers;

16

specifying required activities for foreclosure purchasers;

17

providing a definition; specifying certain violations as

18

unlawful practices; providing for remedies under the

19

Florida Deceptive and Unfair Trade Practices Act;

20

providing for judgments for damages, attorney's fees and

21

costs, and equitable relief; providing for awards of

22

damages; providing limitations on certain actions;

23

specifying the offense of criminal mortgage rescue fraud;

24

providing criminal penalties; providing for limiting

25

contract provisions requiring arbitration; providing for

26

application; providing severability; providing an

27

effective date.

28

29

Be It Enacted by the Legislature of the State of Florida:

30

31

     Section 1. Short title.--This act may be cited as the

32

"Mortgage Rescue Fraud Act."

33

     Section 2. Legislative findings; declarations; intent and

34

purposes.--

35

     (1) The Legislature finds and declares that homeowners who

36

are in default on their mortgages, in foreclosure, or at risk of

37

losing their homes due to nonpayment of taxes may be vulnerable

38

to fraud, deception, and unfair dealing by foreclosure

39

consultants or foreclosure purchasers. The rapid escalation of

40

home values throughout the state has resulted in a significant

41

increase in home equity, which constitutes the greatest financial

42

asset held by many homeowners of this state. The recent increase

43

in interest rates and property taxes throughout the state has

44

placed a financial burden on homeowners and resulted in this

45

state having one of the highest foreclosure rates in the country.

46

During the time period between the default on the mortgage and

47

the scheduled foreclosure sale date, homeowners in financial

48

distress, especially poor, elderly, and financially

49

unsophisticated homeowners, are vulnerable to aggressive

50

foreclosure consultants and foreclosure purchasers who induce

51

homeowners to sell their homes for a fraction of their fair

52

market values, or in some cases even sign away their homes,

53

through the use of schemes that often involve oral and written

54

misrepresentations, deceit, intimidation, and other unreasonable

55

commercial practices.

56

     (2) The Legislature declares that it is the express policy

57

of this state to preserve and guard the social and economic value

58

of homeownership.

59

     (3) The intent and purposes of this section are to provide

60

the owner of a residence at risk of loss with information

61

necessary to make an informed and intelligent decision regarding

62

any transaction with a foreclosure consultant or foreclosure

63

purchaser; to require that the agreement be expressed in writing;

64

to safeguard homeowners against deceit and financial hardship; to

65

ensure, foster, and encourage fair dealing in consultation and

66

the sale and purchase of residences at risk of loss; to prohibit

67

representations that tend to mislead; to prohibit or restrict

68

unfair contract terms; to provide a cooling-off period for

69

homeowners who enter into covered contracts; to afford homeowners

70

a reasonable and meaningful opportunity to rescind sales to

71

foreclosure purchasers; and to preserve and protect home equity

72

for the homeowners of this state.

73

     Section 3. Definitions.--For purposes of this act:

74

     (1)(a) "Foreclosure consultant" means any person who,

75

directly or indirectly, makes any solicitation, representation,

76

or offer to any owner to perform for compensation, or who

77

performs for compensation, any service that the person represents

78

will in any manner accomplish any of the following:

79

     1. Stop or postpone the foreclosure sale or the loss of the

80

home due to nonpayment of taxes;

81

     2. Obtain any forbearance from any beneficiary or mortgagee

82

or relief with respect to a tax sale of the property;

83

     3. Assist the owner in exercising any right of

84

reinstatement or right of redemption;

85

     4. Obtain any extension of the period within which the

86

owner may reinstate the owner's rights with respect to the

87

property;

88

     5. Obtain any waiver of an acceleration clause contained in

89

any promissory note or contract secured by a mortgage on a

90

residence at risk of loss or contained in the mortgage;

91

     6. Assist the owner during a foreclosure or loan default or

92

a tax certificate redemption period in obtaining a loan or

93

advance of funds;

94

     7. Avoid or ameliorate the impairment of the owner's credit

95

resulting from the filing of a foreclosure or the conduct of a

96

foreclosure sale or tax sale; or

97

     8. Save the owner's residence from foreclosure or loss due

98

to nonpayment of taxes.

99

     (b) The term "foreclosure consultant" does not include:

100

     1. A person licensed to practice law in this state when the

101

person renders service in the course of his or her practice as an

102

attorney-at-law.

103

     2. A person licensed as a real estate broker or sales

104

associate under s. 475.181, Florida Statutes, when the person

105

engages in acts the performance of which requires licensure under

106

chapter 475, Florida Statutes, unless the person is engaged in

107

offering services designed to, or purportedly designed to, enable

108

the owner to retain possession of the residence in foreclosure.

109

     3. A person licensed as a residential mortgage broker under

110

s. 494.0031, Florida Statutes, or mortgage lender under s.

111

494.0061, Florida Statutes, when acting under the authority of

112

that license.

113

     4. A person or the person's authorized agent acting under

114

the express authority or written approval of the United States

115

Department of Housing and Urban Development.

116

     5. A person who holds or is owed an obligation secured by a

117

lien on any residence at risk of loss when the person performs

118

services in connection with such obligation or lien if the

119

obligation or lien did not arise as the result of or part of a

120

conveyance of the proposed residence at risk of loss.

121

     6. Banks, savings banks, savings and loan associations, and

122

credit unions organized, chartered, or holding a certificate of

123

authority to do business under the laws of this state or the

124

United States.

125

     7. Mortgagees approved by the United States Department of

126

Housing and Urban Development, any subsidiary or affiliate of

127

such persons or entities, and any agent or employee of such

128

persons or entities while engaged in the business of such persons

129

or entities.

130

     8. An agency or organization meeting the qualifications of

131

s. 501(c)(3) of the United States Internal Revenue Code and doing

132

business for not less than 5 years that offers counseling or

133

advice to an owner of a residence at risk of loss if such owner

134

does not contract for services with a for-profit lender or

135

foreclosure purchaser or any person who structures or plans such

136

contractual transactions.

137

     9. A judgment creditor of the owner, to the extent the

138

judgment creditor's claim accrued prior to the recording of the

139

lis pendens pursuant to s. 48.23, Florida Statutes, but excluding

140

a person who purchased the claim after such recording.

141

     10. A foreclosure purchaser.

142

     (2) "Foreclosure conveyance" means a transaction in which

143

an owner of a residence at risk of loss transfers an interest in

144

fee in the property, the acquirer of the property allows the

145

owner of the property to occupy the property, and the acquirer of

146

the property or a person acting in participation with the

147

acquirer of the property conveys or promises to convey an

148

interest in fee back to the owner or gives the owner an option to

149

purchase the property at a later date.

150

     (3) "Foreclosure purchaser" means any person who acquires

151

any interest in fee in a residence at risk of loss while allowing

152

the owner to possess, occupy, or retain any present or future

153

interest in fee in the property or any person who participates in

154

a joint venture or joint enterprise involving a foreclosure

155

conveyance.

156

     (4) "Owner" means the record owner of the residential real

157

property in foreclosure at the time a notice of lis pendens was

158

recorded or a summons and complaint was served or, when

159

applicable, at the time the loan on the residential real property

160

is more than 90 days delinquent or the owner of the residential

161

real property is subject to loss of ownership due to nonpayment

162

of taxes.

163

     (5) "Person" means any individual, partnership,

164

corporation, limited liability company, association, or other

165

group, however organized.

166

     (6) "Resale" means a bona fide market sale of property

167

subject to a foreclosure conveyance by a foreclosure purchaser to

168

an unaffiliated third party.

169

     (7) "Resale price" means the gross sale price of a property

170

for resale.

171

     (8) "Residence at risk of loss" means:

172

     (a) Residential real property consisting of one to six

173

family dwelling units, including condominiums, against which

174

there is an outstanding notice of pendency of foreclosure

175

recorded pursuant to s. 48.23, Florida Statutes, or against which

176

a summons and complaint has been served under chapter 702,

177

Florida Statutes, or whose owner is more than 90 days delinquent

178

on any loan that is secured by the property; or

179

     (b) Residential real property consisting of one to six

180

family dwelling units, including condominiums, at risk of loss of

181

ownership due to nonpayment of taxes.

182

     (9) "Service" means and includes, but is not limited to:

183

     (a) Debt, budget, or financial counseling of any type;

184

     (b) Receiving money for the purpose of distributing such

185

money to creditors in payment or partial payment of any

186

obligation secured by a lien on a residence at risk of loss;

187

     (c) Contacting creditors on behalf of an owner of a

188

residence at risk of loss;

189

     (d) Arranging or attempting to arrange for an extension of

190

the period within which the owner of a residence at risk of loss

191

may cure the owner's default and reinstate the mortgage or redeem

192

his or her obligation pursuant to s. 45.0315, Florida Statutes;

193

     (e) Arranging or attempting to arrange for any delay or

194

postponement of the time of sale of a residence at risk of loss;

195

     (f) Advising the filing of any document or assisting in any

196

manner in the preparation of any document for filing with any

197

bankruptcy court; or

198

     (g) Giving any advice, explanation, or instruction to an

199

owner of a residence at risk of loss that in any manner relates

200

to the cure of a default or forfeiture or to the postponement or

201

avoidance of sale of a residence at risk of loss.

202

     Section 4. Foreclosure consultant contract requirements.--

203

     (1) A foreclosure consultant contract must be in writing;

204

must fully disclose, clearly and conspicuously, the exact nature

205

of the foreclosure consultant's services and the total amount and

206

terms of compensation; and must include:

207

     (a) An accurate description of the goods or services

208

offered and to be provided by the foreclosure consultant.

209

     (b) An accurate description of how the foreclosure

210

consultant will assist persons in avoiding or delaying

211

foreclosure or curing or otherwise addressing a default.

212

     (2) The following notice, in at least 14-point boldfaced

213

type if the contract is printed, or in capital letters if the

214

contract is typed, must be displayed immediately above the

215

statement required by subsection (3):

216

217

NOTICE REQUIRED BY FLORIDA LAW

218

219

...(Name of foreclosure consultant)... or anyone

220

working for him or her CANNOT:

221

     (1) Take any money from you or ask you for money

222

until ...(name of foreclosure consultant)... has

223

completely finished doing everything he or she said he

224

or she would do; or

225

     (2) Ask you to sign or have you sign any lien,

226

mortgage, or deed.

227

228

     (3) The foreclosure consultant contract must be written in

229

the same language as principally used by the foreclosure

230

consultant to describe his or her services or to negotiate the

231

contract, must be dated and signed by the owner of the residence

232

at risk of loss, and must contain, in immediate proximity to the

233

space reserved for the owner's signature, the following

234

conspicuous statement in a size equal to at least 14-point

235

boldfaced type if the contract is printed, or in capital letters

236

if the contract is typed:

237

238

You, the owner, may cancel this transaction at any time

239

until after the foreclosure consultant has fully

240

performed each and every service the foreclosure

241

consultant contracted to perform or represented he or

242

she would perform. See the attached notice of

243

cancellation form for an explanation of this right.

244

245

     (4) The foreclosure consultant contract and notice of

246

cancellation must contain on the first page, in a type size no

247

smaller than that generally used in the body of the document,

248

each of the following:

249

     (a) The name and address of the foreclosure consultant to

250

whom the notice of cancellation is to be mailed or otherwise

251

delivered. A post office box must be accompanied by a physical

252

address at which the notice could be delivered by a method other

253

than mail.

254

     (b) The date the owner signed the contract.

255

     (5) The foreclosure consultant contract must be accompanied

256

by a completed form in duplicate, captioned "Notice of

257

Cancellation," which must be attached to the contract, must be

258

easily detachable, and must contain in at least 14-point

259

boldfaced type if the contract is printed, or in capital letters

260

if the contract is typed, the following statement written in the

261

same language as that used in the contract:

262

263

NOTICE OF CANCELLATION

264

265

...(Enter date of transaction) (Date)...

266

267

You may cancel this transaction, without any penalty or

268

obligation, at any time until after the foreclosure

269

consultant has fully performed each and every service

270

the foreclosure consultant contracted to perform or

271

represented he or she would perform.

272

273

To cancel this transaction, mail or deliver a signed

274

and dated copy of this cancellation notice, or any

275

other written notice, to:

276

277

...(Name of foreclosure consultant)...

278

...(Address of foreclosure consultant's place of

279

business)...

280

281

I hereby cancel this transaction.

282

...(Date)...

283

...(Owner's signature)...

284

285

     (6) The foreclosure consultant shall provide the owner with

286

a copy of the contract and the attached notice of cancellation

287

immediately upon execution of the contract.

288

     (7) If the foreclosure consultant contract fails to

289

substantially comply with the provisions of this section, the

290

contract is void and unenforceable and any documents signed by

291

the owner pursuant to the contract are null and void.

292

     Section 5. Rescission of foreclosure consultant

293

contracts.--

294

     (1) In addition to any other right under law to rescind a

295

contract, an owner has the right to cancel a foreclosure

296

consultant contract at any time until after the foreclosure

297

consultant has fully performed each service the foreclosure

298

consultant contracted to perform or represented he or she would

299

perform.

300

     (2) Cancellation occurs when the owner gives written notice

301

of cancellation to the foreclosure consultant at the address

302

specified in the foreclosure consultant contract.

303

     (3) Notice of cancellation, if given by mail, is effective

304

when deposited in the mail properly addressed with postage

305

prepaid.

306

     (4) Notice of cancellation given by the owner need not take

307

the particular form as provided with the foreclosure consultant

308

contract and, however expressed, is effective if the notice

309

indicates the intention of the owner not to be bound by the

310

contract.

311

     Section 6. Foreclosure conveyance contract requirements.--A

312

foreclosure purchaser shall enter into a foreclosure conveyance

313

in the form of a written contract. Every contract must be written

314

in letters of a size equal to at least 14-point boldfaced type,

315

or in capital letters if the contract is typed, in the same

316

language principally used by the owner to negotiate the sale of

317

the residence at risk of loss; must be fully completed, signed,

318

and dated by the owner of the residence at risk of loss and the

319

foreclosure purchaser; and must be witnessed and acknowledged by

320

a notary public before the execution of any instrument of

321

conveyance of the residence at risk of loss. If the contract

322

fails to substantially comply with this section and section 7,

323

the contract is void and unenforceable and any documents signed

324

by the owner pursuant to the contract are null and void.

325

     Section 7. Foreclosure conveyance contract terms.--Each

326

contract required by section 6 must contain the entire agreement

327

of the parties and must include:

328

     (1) The name, business address, and telephone number of the

329

foreclosure purchaser.

330

     (2) The address of the residence at risk of loss.

331

     (3) The total consideration to be given by the foreclosure

332

purchaser or tax lien payor in connection with or incident to the

333

sale.

334

     (4) A complete description of the terms of payment or other

335

consideration, including, but not limited to, any services of any

336

nature that the foreclosure purchaser represents he or she will

337

perform for the owner of the residence at risk of loss before or

338

after the sale.

339

     (5) The time at which possession is to be transferred to

340

the foreclosure purchaser.

341

     (6) A complete description of the terms of any related

342

agreement designed to allow the owner of the residence at risk of

343

loss to remain in the residence, such as a rental agreement,

344

repurchase agreement, contract for deed, or lease with option to

345

buy.

346

     (7) A notice of cancellation as provided in subsection (2)

347

of section 9.

348

     (8) The following notice in at least 14-point boldfaced

349

type if the contract is printed, or in capital letters if the

350

contract is typed, and completed with the name of the foreclosure

351

purchaser, immediately above the statement required by subsection

352

(1) of section 9:

353

354

NOTICE REQUIRED BY FLORIDA LAW

355

356

Until your right to cancel this contract has ended,

357

...(name of foreclosure purchaser)... or anyone working

358

for ...(name of foreclosure purchaser)... CANNOT ask

359

you to sign or have you sign any deed or other

360

document. You are urged to have this contract reviewed

361

by an attorney of your choice within 5 business days

362

after signing it.

363

364

     (9) If title to the residence at risk of loss will be

365

transferred in the conveyance transaction, the following notice

366

in at least 14-point boldfaced type if the contract is printed,

367

or in capital letters if the contract is typed, and completed

368

with the name of the foreclosure purchaser, immediately above the

369

statement required by this section:

370

371

NOTICE REQUIRED BY FLORIDA LAW

372

373

As part of this transaction, you are giving up title to

374

your home.

375

376

The contract required by this section survives delivery of any

377

instrument of conveyance of the residence in foreclosure and has

378

no effect on persons other than the parties to the contract.

379

     Section 8. Cancellation of foreclosure conveyance

380

contracts.--

381

     (1) In addition to any other right of rescission, the owner

382

of a residence at risk of loss has the right to cancel any

383

contract with a foreclosure purchaser until midnight of the 5th

384

business day following the day on which the owner of the

385

residence at risk of loss signs a contract that complies with

386

this act or until 8:00 a.m. on the last day of the period during

387

which the owner of the residence at risk of loss has a right of

388

redemption under s. 45.0315, Florida Statutes, or s. 197.472,

389

Florida Statutes, whichever occurs first.

390

     (2) Cancellation occurs when the owner of the residence at

391

risk of loss delivers, by any means, written notice of

392

cancellation to the address specified in the foreclosure

393

conveyance contract.

394

     (3) A notice of cancellation given by the owner of the

395

residence at risk of loss need not take the particular form as

396

provided with the foreclosure conveyance contract.

397

     (4) Within 10 days following receipt of a notice of

398

cancellation given in accordance with this section, the

399

foreclosure purchaser shall return without condition any original

400

contract and any other documents signed by the owner of the

401

residence at risk of loss.

402

     Section 9. Notice of cancellation of foreclosure conveyance

403

contract.--

404

     (1) The contract must contain, in immediate proximity to

405

the space reserved for the signature of the owner of the

406

residence at risk of loss, a conspicuous statement in a size

407

equal to at least 14-point boldfaced type if the contract is

408

printed, or in capital letters if the contract is typed, as

409

follows:

410

411

You may cancel this contract for the sale of your house

412

without any penalty or obligation at any time before

413

...(date and time).... See the attached notice of

414

cancellation form for an explanation of this right.

415

416

The foreclosure purchaser shall accurately enter the date and

417

time of day on which the cancellation right ends.

418

     (2) The contract must be accompanied by a completed form in

419

duplicate, captioned "Notice of Cancellation" in a size equal to

420

a 14-point boldfaced type if the contract is printed, or in

421

capital letters if the contract is typed, followed by a space in

422

which the foreclosure purchaser shall enter the date on which the

423

owner of the residence at risk of loss executes any contract.

424

This form must be attached to the contract, must be easily

425

detachable, and must contain in type of at least 14-point

426

boldfaced type if the contract is printed, or in capital letters

427

if the contract is typed, the following statement written in the

428

same language as that used in the contract:

429

430

NOTICE OF CANCELLATION

431

432

...(Date contract signed)...

433

434

You may cancel this contract for the sale of your

435

house, without any penalty or obligation, at any time

436

before ...(date and time).... To cancel this

437

transaction, mail or deliver a signed and dated copy of

438

this cancellation notice to ...(name of foreclosure

439

purchaser)... at ...(street address of foreclosure

440

purchaser's place of business)... NOT LATER THAN

441

...(date and time)....

442

443

I hereby cancel this transaction.

444

...(Date)...

445

...(Owner's signature)...

446

447

     (3) The foreclosure purchaser shall provide the owner of

448

the residence at risk of loss with a copy of the contract and the

449

attached notice of cancellation at the time the contract is

450

executed by all parties.

451

     (4) The 5 business days during which the owner of the

452

residence at risk of loss may cancel the contract shall not begin

453

to run until all parties to the contract have executed the

454

contract and the foreclosure purchaser has complied with this

455

section.

456

     Section 10. Waiver.--Any waiver of the provisions of this

457

act by an owner of a residence at risk of loss is void and

458

unenforceable as contrary to public policy, except that such an

459

owner may waive the 5-business-day right to cancel provided in

460

section 8 if the property is subject to a foreclosure sale within

461

the 5-business-day period, and the owner agrees to waive his or

462

her right to cancel in a handwritten statement signed by all

463

parties holding title to the residence at risk of loss.

464

     Section 11. Prohibited activities.--

465

     (1) A foreclosure consultant may not:

466

     (a) Claim, demand, charge, collect, or receive any

467

compensation until after the foreclosure consultant has fully

468

performed every service the foreclosure consultant contracted to

469

perform or represented he or she would perform;

470

     (b) Claim, demand, charge, collect, or receive for any

471

reason any fee, interest, or other compensation that exceeds two

472

monthly mortgage payments of principal and interest or the most

473

recent tax installment on the residence at risk of loss,

474

whichever is less;

475

     (c) Take any wage assignment, a lien of any type on real or

476

personal property, or any other security to secure the payment of

477

compensation. Any such security is void and unenforceable;

478

     (d) Receive any consideration from any third party in

479

connection with services rendered to an owner of a residence at

480

risk of loss unless the consideration is first fully disclosed to

481

the owner;

482

     (e) Acquire any interest, directly or indirectly or by

483

means of a subsidiary or affiliate, in a residence at risk of

484

loss from an owner of the residence with whom the foreclosure

485

consultant has contracted;

486

     (f) Take any power of attorney from an owner for any

487

purpose, except to inspect documents as provided by law; or

488

     (g) Induce or attempt to induce any owner to enter into a

489

contract that does not comply in all respects with this act.

490

     (2) A foreclosure purchaser, in the course of a conveyance

491

of a residence at risk of loss, may not:

492

     (a) Enter into, or attempt to enter into, a foreclosure

493

conveyance with an owner of a residence at risk of loss unless:

494

     1. The foreclosure purchaser verifies and can demonstrate

495

that the owner of the residence at risk of loss has a reasonable

496

ability to pay for the subsequent conveyance of an interest back

497

to the owner and to make monthly or any other payments due prior

498

to that time. In the case of a lease with an option to purchase,

499

payment ability also includes the reasonable ability to purchase

500

the property within the term of the option to purchase. There is

501

a rebuttable presumption that the foreclosure purchaser has not

502

verified reasonable payment ability if the foreclosure purchaser

503

has not obtained documents other than a statement by the owner of

504

assets, liabilities, and income.

505

     2. The foreclosure purchaser and the owner of the residence

506

at risk of loss complete a closing for any foreclosure conveyance

507

in which the foreclosure purchaser obtains a deed or mortgage

508

from an owner. For purposes of this section, "closing" means an

509

in-person meeting to complete final documents incident to the

510

sale of the real property or creation of a mortgage on the real

511

property conducted by a person who is not employed by or an

512

affiliate of the foreclosure purchaser.

513

     3. The foreclosure purchaser obtains the written consent of

514

the owner of the residence at risk of loss to a grant by the

515

foreclosure purchaser of any interest in the property during such

516

times as the owner maintains any interest in the property.

517

     4. The foreclosure purchaser complies with the requirements

518

for disclosure, loan terms, and conduct in the federal Home

519

Ownership Equity Protection Act, 15 U.S.C. s. 1639, or its

520

implementing regulation, 12 C.F.R. ss. 226.31, 226.32, and

521

226.34, for any foreclosure conveyance in which the owner of a

522

residence at risk of loss obtains a vendee interest in a contract

523

for deed, regardless of whether the terms of the contract for

524

deed meet the annual percentage rate or points and fees

525

requirements for a covered loan in 12 C.F.R. s. 226.32(a) and

526

(b);

527

     (b) Fail to:

528

     1. Ensure that title to the subject dwelling has been

529

conveyed to the owner of the residence at risk of loss;

530

     2. Make a payment to the owner of the residence at risk of

531

loss such that the owner has received consideration in an amount

532

of at least 82 percent of the fair market value of the property

533

within 150 days after the eviction or voluntary relinquishment of

534

possession of the dwelling by the owner. The foreclosure

535

purchaser shall make a detailed accounting of the basis for the

536

payment amount, or a detailed accounting of the reasons for

537

failure to make a payment, including providing written

538

documentation of expenses, within such 150-day period. The

539

accounting with documentation attached shall be provided to the

540

owner of the residence at risk of loss when payment is made. For

541

purposes of this subparagraph, the following apply:

542

     a. There is a rebuttable presumption that an appraisal by a

543

person licensed or certified by an agency of the Federal

544

Government or this state to appraise real estate constitutes the

545

fair market value of the property.

546

     b. The time for determining the fair market value shall be

547

determined in the foreclosure conveyance contract at the time of

548

the execution of the foreclosure conveyance contract or at

549

resale. If the contract states that the fair market value shall

550

be determined at the time of resale, the fair market value shall

551

be the resale price if the property is sold within 120 days after

552

the eviction or voluntary relinquishment of the property by the

553

owner. If the contract states that the fair market value shall be

554

determined at the time of resale and the resale is not completed

555

within 120 days after the eviction or voluntary relinquishment of

556

the property by the owner, the fair market value shall be

557

determined by an appraisal conducted during such 120-day period,

558

and payment, if required, shall be made to the owner of the

559

residence at risk of loss. However:

560

     (I) The fair market value shall be recalculated as the

561

resale price on resale, and an additional payment amount, if

562

appropriate based on the resale price, shall be made to the owner

563

of the residence at risk of loss within 15 days after resale; and

564

     (II) A detailed accounting of the basis for the payment

565

amount, or a detailed accounting of the reasons for failure to

566

make additional payment, shall be made within 15 days after

567

resale, including providing written documentation of expenses.

568

     c. The accounting shall be a separate document showing the

569

fair market value of the property at the time indicated in the

570

foreclosure conveyance contract; showing 82 percent of the fair

571

market value; specifying individually all consideration actually

572

paid; showing amounts and to whom paid; and providing the total

573

amount to be paid to the owner of the residence at risk of loss,

574

where appropriate.

575

     d.(I) For purposes of this subparagraph, the term

576

"consideration" means any payment or thing of value provided to

577

the owner of the residence at risk of loss, including unpaid rent

578

or contract for deed payments owed by the owner of the residence

579

at risk of loss prior to the date of eviction or voluntary

580

relinquishment of the property, reasonable costs paid to third

581

parties necessary to complete the foreclosure conveyance

582

transaction, payment of money to satisfy a debt or legal

583

obligation of the owner of the residence at risk of loss, or the

584

reasonable cost of repairs for damage to the dwelling caused by

585

the owner of the residence at risk of loss.

586

     (II) The term "consideration" does not include amounts

587

imputed as a down payment or fee to the foreclosure purchaser, or

588

a person acting in participation with the foreclosure purchaser,

589

incident to a contract for deed, lease, or option to purchase

590

entered into as part of the foreclosure conveyance, except for

591

reasonable costs paid to third parties necessary to complete the

592

foreclosure conveyance; or

593

     3. Enter into repurchase or lease terms as part of the

594

subsequent conveyance that are unfair or commercially

595

unreasonable, or engage in any other unfair or unconscionable

596

conduct;

597

     (c) Represent, directly or indirectly, that:

598

     1. The foreclosure purchaser is acting as an advisor or a

599

consultant or in any other manner represent that the foreclosure

600

purchaser is acting on behalf of the owner of the residence at

601

risk of loss;

602

     2. The foreclosure purchaser possesses certification,

603

registration, or licensure that the foreclosure purchaser does

604

not possess;

605

     3. The foreclosure purchaser is not a member of a licensed

606

profession, if that is untrue; or

607

     4. The foreclosure purchaser is assisting the owner of the

608

residence at risk of loss in "saving the house," or a

609

substantially similar phrase, if the result of the transaction

610

will be that the owner of the residence at risk of loss does not

611

complete a redemption of the property;

612

     (d) Engage in any other conduct or make any other

613

statements, directly or by implication, that are false,

614

deceptive, or misleading or that are likely to cause confusion or

615

misunderstanding, including, but not limited to, statements

616

regarding the value of the residence at risk of loss, the amount

617

of proceeds the owner of the residence at risk of loss will

618

receive after a foreclosure sale, any contract term, or the

619

rights or obligations of the owner of the residence at risk of

620

loss incident to or arising out of the foreclosure conveyance; or

621

     (e) Do any of the following until the period during which

622

the owner of the residence at risk of loss may cancel the

623

transaction has fully expired:

624

     1. Accept from the owner of the residence at risk of loss

625

an execution of, or induce the owner of the residence at risk of

626

loss to execute, any instrument of conveyance of any interest in

627

the residence at risk of loss;

628

     2. Record in the public records maintained by the clerk of

629

the court in the county or counties in which the real property is

630

located any document, including, but not limited to, any

631

instrument of conveyance, signed by the owner of the residence at

632

risk of loss;

633

     3. Transfer or encumber, or purport to transfer or

634

encumber, any interest in the residence at risk of loss to any

635

third party. A grant of any interest or encumbrance is not

636

defeated or affected as against a bona fide purchaser or

637

encumbrance for value and without notice of a violation of this

638

act. Knowledge on the part of any such person or entity that the

639

property was residential real property in foreclosure does not

640

constitute a notice of a violation of this act. This section does

641

not abrogate any duty of inquiry that exists as to rights or

642

interests of persons in possession of the residential real

643

property in foreclosure; or

644

     4. Pay any consideration to the owner of the residence at

645

risk of loss.

646

     Section 12. Civil remedies.--

647

     (1) A violation of this act constitutes an unlawful

648

practice under the Florida Deceptive and Unfair Trade Practices

649

Act, and all remedies under that act are available for an action

650

under that act. An owner of a residence at risk of loss may bring

651

an action against a foreclosure consultant or foreclosure

652

purchaser for any violation of this act. Judgment must be entered

653

for actual damages and consequential damages, reasonable

654

attorney's fees and costs, and appropriate equitable relief,

655

including, but not limited to, the rescission of any deed,

656

mortgage, or other instrument signed by the owner or foreclosure

657

purchaser. The rights and remedies provided in this act are

658

cumulative with, and not a limitation of, any other rights and

659

remedies provided by law. Any action brought pursuant to this

660

section must be commenced within 4 years from the date of the

661

alleged violation.

662

     (2) In addition to any other damages available to an owner

663

of a residence at risk of loss:

664

     (a) For a violation of paragraph (1)(a), paragraph (1)(b),

665

or paragraph (1)(d) of section 11, the court may award damages up

666

to one and one-half times the compensation charged by the

667

foreclosure consultant if the court finds that the foreclosure

668

consultant's conduct was in bad faith.

669

     (b) For a violation of the provisions of subsection (2) of

670

section 11, the court may award damages no less than one and one-

671

half times the actual damages.

672

     (3) Notwithstanding any other provision of this section, no

673

action may be brought on the basis of a violation of this act

674

except by an owner against whom the violation was committed or by

675

the attorney general.

676

     Section 13. Criminal mortgage rescue fraud; penalties.--A

677

person commits the offense of criminal mortgage rescue fraud when

678

he or she intentionally violates any provision of section 11. A

679

person who engages in any activity that constitutes criminal

680

mortgage rescue fraud commits a felony of the third degree,

681

punishable as provided in s. 775.082, s. 775.083, or s. 775.084,

682

Florida Statutes.

683

     Section 14. Liability.--

684

     (1) Any provision in a contract that attempts or purports

685

to require arbitration of any dispute arising under this act is

686

void at the option of the owner.

687

     (2) This section applies to any foreclosure consultant

688

contract or foreclosure conveyance contract entered into on or

689

after October 1, 2008.

690

     Section 15. Severability.--If any provision of this act or

691

its application to any person or circumstance is held invalid,

692

the invalidity does not affect other provisions or applications

693

of the act which can be given effect without the invalid

694

provision or application, and to this end the provisions of this

695

act are declared severable.

696

     Section 16.  This act shall take effect October 1, 2008.