Sun Sentinel Publishes Roy Oppenheim's OP/Ed: Florida out in cold on foreclosure laws

By Roy Oppenheim

A union that was once called the United States of America sure seems to be looking like the Divided States of America.

In California, a homeowner can buy a house, sign a mortgage, live and just walk away. The homeowner will take a hit on their credit score, but that's it.

Florida residents skipping on their mortgages are destined to have banks, collection agencies and private investigators chasing after them and digging through their trash or following the homeowner around. They are also effectively enslaved by their debt for up to 20 years.

That's right, in places like California and many other states, a mortgage is a non-recourse obligation.

However, the state of Florida is called a judicial foreclosure state or a recourse state. The foreclosure outlook in the Sunshine State is not all that sunny.

In Florida, the banks will foreclose on the home through judicial foreclosure and then will likely get a "deficiency judgment." That deficiency judgment will be for the amount of money the homeowner still owes the bank after the foreclosure sale. .

So here we are, the Divided States of America: states where homeowners are enslaved by their debt, and states where the homeowner is free.

In any event, members of the Florida Legislature are starting to realize they either need to change the laws or continue to watch the Florida population implode while the economy continues to tank.

Who in their right mind would move to Florida when they can move to another state where signing a mortgage is not a mortally binding contract?

Thankfully, the Florida Supreme Court is now considering massive rule changes that would allow nonjudicial foreclosure and thus a waiver of the deficiency judgment. Bills are floating around the Legislature that could effectively ban deficiency judgments, at least against one's homestead property.

The model is broken, and it won't get fixed until there is a national uniform standard. The options are: All states become recourse states, like Florida, and every homeowner becomes a servant to the banks, or Florida can stop sucking up to the banks, get competitive with other non-recourse states like California and stick up for the little guy.

My vote: No more deficiency judgments in Florida. Plain and simple. Until that happens, don't for a moment think this is the United States of America. This country is divided, a division that is now intolerable and could lead to the demise of certain states.

Roy Oppenheim is a South Florida foreclosure defense attorney.