HB 75

1	A bill to be entitled
2	An act relating to homestead property foreclosure actions;
3	providing a short title; specifying application to
4	homestead property; providing procedural requirements and
5	limitations for plaintiffs, defendants, and courts in
6	certain foreclosure actions; specifying document
7	production requirements; requiring mediation; specifying
8	settlement negotiation requirements; providing criteria
9	for commercial reasonableness of renegotiated loans;
10	requiring the Department of Business and Professional
11	Regulation to adopt rules relating to appraisal methods;
12	providing for forbearance liens under certain
13	circumstances; providing lien limitations; providing for
14	satisfaction of such liens; requiring the Supreme Court to
15	determine certain forms; specifying application to certain
16	foreclosure actions; providing for future repeal;
17	providing an effective date.
18
19	Be It Enacted by the Legislature of the State of Florida:
20
21	Section 1.  (1)  This act may be cited as the "Foreclosure
22	Bill of Rights."
23	(2)  This act shall apply exclusively to actions to
24	foreclose a mortgage on real estate used and owned as a
25	homestead as defined in s. 196.012, Florida Statutes.
26	(3)  In any action to foreclose a mortgage on homestead
27	property, a defendant may invoke the protections of this section
28	by filing and serving a notice to invoke the Foreclosure Bill of
29	Rights, which shall include a sworn statement that the property
30	in foreclosure is the defendant's homestead property. The form
31	for a notice to invoke shall be provided to the defendant,
32	together with the summons and complaint, with the original
33	service of process for the foreclosure action. The Supreme Court
34	shall determine the form of the notice to invoke.
35	(4)  After the protections of this section have been
36	invoked by a defendant, a plaintiff is not entitled to a final
37	judgment against that defendant until all of the requirements of
38	this section have been satisfied.
39	(5)  If a default is entered against a defendant, the
40	defendant is not entitled to the protections of this section
41	until the default judgment is set aside.
42	(6)(a)  Within 45 days after the filing and service of the
43	notice to invoke, the plaintiffs shall provide for a new
44	appraisal of the property in foreclosure. Such appraisal shall
45	consider ordinary transactions, short sales, and foreclosure
46	sales of similarly situated properties within a reasonable
47	surrounding area in determining the actual current market value
48	of the property. The Department of Business and Professional
49	Regulation shall adopt rules necessary to develop appraisal
50	methods that accurately determine the actual current market
51	value of the property.
52	(b)  Within 60 days after filing the notice to invoke, each
53	plaintiff shall provide to the defendant the results of all
54	appraisals conducted pursuant to paragraph (a), together with
55	true copies of all closing documents relating to the mortgage
56	under foreclosure, including, but not limited to:
57	1.  Any loan application used to determine the defendant's
58	creditworthiness.
59	2.  Any settlement statement.
60	3.  The mortgage being foreclosed.
61	4.  Any promissory note related to the mortgage.
62	5.  Any assignments of the mortgage or note.
63	(c)1.  If any closing documents are not in the actual
64	possession of the plaintiff, the plaintiff, in order to comply
65	with paragraph (b), must make reasonable efforts to obtain the
66	documents and, if the documents cannot be obtained, serve on the
67	defendant an affidavit detailing the efforts made to obtain the
68	documents, the person or entity in whose possession the
69	documents are believed to be, and the last known address,
70	location, and telephone number of the person or entity in whose
71	possession the documents are believed to be. The plaintiff shall
72	file a certificate of compliance with the requirements of this
73	subparagraph. The Supreme Court shall determine the form of the
74	certificate.
75	2.  Within 30 days after the filing and serving of the
76	certificate of compliance under subparagraph 1., the defendant
77	shall provide to the plaintiff a sworn financial affidavit, a
78	copy of the defendant's tax returns for the immediately
79	preceding 3 years, and a copy of the defendant's bank statements
80	for the immediately preceding 3 months. Upon motion, the court
81	may issue any protective orders deemed to be necessary and, in
82	the interest of justice, to protect the privacy rights of the
83	defendant. The Supreme Court shall determine the form of the
84	financial affidavit.
85	(7)  By agreement of the parties or with prior court
86	approval, including by administrative order, service of any
87	documents under this section may be made in electronic format or
88	upon such other terms as may be agreed to or ordered in the
89	interests of justice and judicial economy.
90	(8)  All actions to foreclose a mortgage shall be subject
91	to court-ordered mediation pursuant to s. 44.102, Florida
92	Statutes. The mediation shall be coordinated and scheduled by
93	the parties no sooner than 60 days after completion of all other
94	requirements of this section.
95	(9)  The plaintiffs shall make a good faith effort to
96	negotiate a settlement, which shall include efforts to
97	renegotiate the loan at a principal equivalent to the actual
98	market value as determined under paragraph (6)(a). In
99	determining good faith, the court shall consider:
100	(a)  Whether a renegotiated loan is commercially
101	reasonable.
102	(b)  Whether the plaintiff has made any offer.
103	(c)  The reasonableness of any offer made.
104	(d)  Any other factor the court deems relevant.
105	(10)  In determining the commercial reasonableness of a
106	renegotiated loan, the court shall consider the following
107	factors:
108	(a)  The income, savings, and other assets of the
109	defendants.
110	(b)  The reasonableness of the terms of the original loan,
111	including whether issues of fraud are presented in the
112	negotiation and closing of the original loan.
113	(c)  Whether the loan term can be extended.
114	(d)  Whether the interest rate can be reduced.
115	(e)  Whether the repayment terms can be changed.
116	(f)  The creditworthiness of the defendants, other than as
117	affected by the foreclosure and any related nonpayments.
118	(11)(a)  If the loan is refinanced with a reduced principal
119	at the property's actual market value, the plaintiff shall be
120	entitled to a forbearance lien on the property for an amount
121	equal to the difference between the original principal and the
122	new principal. The forbearance lien shall not grant any other
123	right to foreclose on the property or otherwise collect the
124	moneys other than as provided in this act.
125	(b)  The forbearance lien shall be recorded in the public
126	records of the county in which the property is located. The
127	Supreme Court shall determine the form of the forbearance lien.
128	(c)1.  Upon the first resale, refinance, or transfer by
129	operation of law or otherwise, the beneficiary of the
130	forbearance lien shall be entitled to any proceeds of the
131	resale, refinance, or transfer in excess of the renegotiated
132	loan balance to be applied to satisfaction of the lien.
133	2.  Upon any subsequent resale, refinance, or transfer by
134	operation of law or otherwise, the beneficiary of the
135	forbearance lien shall have the right to foreclose the lien.
136	(12)  The clerks of the circuit courts shall provide forms,
137	together with instructions in English and Spanish, to pro se
138	defendants seeking assistance in any foreclosure action. Such
139	forms shall be provided at no cost to the defendants. The
140	Supreme Court shall determine the content of the forms and
141	instructions to be provided.
142	(13)  This act applies to foreclosure actions initiated on
143	or after July 1, 2010, and to all active foreclosure actions in
144	which a final judgment has not been rendered as of July 1, 2010.
145	(14)  This act expires July 1, 2015.
146	Section 2.  This act shall take effect July 1, 2010.

CODING: Words stricken are deletions; words underlined are additions.