Florida Judges Bash Bank “Foreclosure Mills”

A Judge in Pasco County, Florida, admonished U.S. Bank, N.A. for committing a “fraud” in a foreclosure lawsuit. Another Judge in St. Petersburg, Florida was highly skeptical about the validity of documents submitted by the bank’s “foreclosure mill”. These cases highlight many of the problems that banks are encountering when trying to foreclose on homes using a “foreclosure mill”.

As reported in the Wall Street Journal, U.S. Bank N.A. sued a homeowner after the homeowner defaulted on a $190,000 loan he had received from U.S. Bank N.A. in Pasco County, Florida The Law Offices of David J. Stern, which represented the bank, prepared a document called “assignment of mortgage” showing that the bank received ownership of the mortgage in December of 2007. The document was also dated December 2007.

But after investigating the matter, the Circuit Court Judge assigned to the case concluded that the document could not have been prepared until 2008, and not 2007 as the bank claimed. Therefore, the Judge ruled that the bank could not prove it owned the mortgage at the time the foreclosure was filed. Specifically, the Judge wrote that the”assignment of mortgage” that was purportedly prepared in 2007 “did not exist at the time of the filing of this action … was subsequently created and … fraudulently backdated, in a purposeful, intentional effort to mislead.” The Judge ultimately dismissed U.S. Banks N.A.’s foreclosure case against the homeowner.

This is just another example of an unfortunate trend developing in Florida. Banks are inundated with foreclosures due to the collapse of the housing market, and often times they do not have the appropriate paperwork to support their claims. Our law firm could help assist in defending these types of cases, and we can assist with your needs.

And with the increased number of foreclosures comes the higher propensity for banks to make mistakes. Which is yet another reason to ensure that banks be required to go through the judicial process. Fortunately, and as we reported in our earlier blog posting the Florida legislature rejected the bank’s efforts to bypass the judiciary.

“The pure volume of foreclosures has a tendency perhaps to encourage sloppiness, boilerplate paperwork or a lack of thoroughness” by attorneys for banks, wrote the Judge in the Pasco County assigned to this particular foreclosure claim. The deluge of foreclosures makes the process “fraught with potential for fraud”, she said.

At an unrelated hearing, a Florida State Court Judge in St. Petersburg said that an affidavit submitted by the David J. Stern law firm on behalf a bank in a foreclosure case was not necessarily sufficient to establish that the bank was the owner of the mortgage. The Judge, in that case, said at a hearing that “I don’t have any confidence that any of the documents the Court’s receiving on these mass foreclosures are valid”.

Plase contact our office today if you are facing foreclosure. Our team of foreclosure defense attorneys can help you. But don’t delay and call us today.