South Florida Bankruptcy Filings Rise on Foreclosure Surge

Local Florida foreclosure defense and bankruptcy attorneys have been reporting a new surge in personal bankruptcy filings as lenders speed up foreclosures in Miami, Broward and Palm Beach County, signaling the worst is far from over.

Almost 50% of Miami homes sales continue to be distressed property sales and this number could spike even further as more local property owners go bankrupt and mortgage lenders get tough.

South Florida in Bankruptcy

October saw personal bankruptcies surge almost 20% in the South Florida tri-county area as desperate homeowners seek Florida foreclosure defense attorney’s services and they run out of other options.

This is somewhat surprising as some had thought the worst was over and this is traditionally a slower period for bankruptcy filings as residents get busy with the holidays. But the truth is that this situation is only likely to get worse in coming months.

With the holidays putting even more financial pressure on homeowners and the end of short sale incentives at the end of 2012 more and more may find bankruptcy is their best or only choice. Remember this doesn’t even count the bankruptcies being filed by those out of state who own homes here and which will certainly spike on events like Sandy and the Canadian housing market now coming apart.

Mortgage Settlement Money Used to Crackdown on South Florida Homeowners

Ironically after months of waiting for officials to decide what will be done with Florida’s share of the mortgage settlement money a good portion of that seems pegged to be actually be used to pursue homeowners and speed up foreclosures.

Forget about relief unless you are a mortgage lender.

While some of the $60 million that Florida attorney general Pam Bondi is in control of will be designated to foreclosure related legal services, more is going to ‘down payment assistance’ which isn’t likely to do much for the local market considering this help was effectively outlawed by congress in 2009 and is useless for most home buyers. The rest is to go to easing the foreclosure backlog in courts (read speeding up Florida foreclosures).

An additional $74 million is being classified as penalties and will simply go into the state’s general budget, not likely going towards helping the housing crisis at all. The balance won’t even be sorted out until next year after many more have already lost their homes.

This on top of the foreclosure moratorium in the northeast, halting foreclosures in New Jersey, Rhode Island, New York and Connecticut in the wake of Sandy will no doubt just put more pressure on mortgage lenders and the government to get tougher on Florida homeowners and result in faster foreclosures here over the next few months.

Where to Find Help

With courts to get busier in the next few months South Florida homeowners need to act now in order to protect themselves before their homes are swept out from underneath them.

Whether a bankruptcy, short sale or other solution is right comes down to individual circumstances but unless homeowners reach out and consult a professional Florida foreclosure defense attorney quickly they may not figure out which that is in time.


July 29, 2013 This post was written by Categories: Uncategorized Comments are off for this post