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Bondi, lawmakers take on state's surging foreclosure problem

Lawmakers in Tallahassee are renewing their focus on Florida’s foreclosure problem, after the state ended 2012 as America’s foreclosure capital.

Attorney General Pam Bondi, Senate President Don Gaetz and House Speaker Will Weatherford held a press conference Thursday to discuss a newly approved $60 million program for housing aid.

The program—which includes money for homebuyer assistance, legal aid and foreclosure prevention—is part of last year’s multibillion dollar national settlement that included cash payments to states.

Bondi reached a deal with Weatherford and Gaetz after an initial disagreement over who had authority over the $334 million in funds allocated to Florida. In the end, the groups compromised to allow the Legislature to direct the money during the 2013 legislative session, with $60 million carved out for release prior to the session.

Bondi’s office organized a press conference Thursday to discuss the details of the $60 million program. The deal includes:

  • --$35 million for Down Payment Assistance (Florida Housing Finance Corporation)
  • --$10 million for Foreclosure Counseling (Florida Housing Finance Corporation)
  • --$5 million for Reducing the Foreclosure Backlog  (State Courts System)
  • --$5 million for Legal Aid (Various providers)
  • --$5 million for Attorney General’s Legal Fees (Attorney General’s Office)

As part of the larger settlement, Florida homeowners have received billions of dollars worth of direct mortgage assistance from banks.

“Almost 50,000 Floridians have received at least $73,000,” Bondi said. “That’s a lot of money.”

While lawmakers diverted $74 million from the foreclosure settlement for general spending, another $200 million remains to be spent. Lawmakers will decide how to allocate the money during the session, though Bondi, Gaetz and Weatherford have committed to using the money for housing-related causes.

In the House Subcommittee on Civil Justice on Thursday, legislators got a glimpse of how bad the foreclosure problem is in Florida.

During a workshop on the foreclosure problems faced by state, the committee heard from experts in housing, state courts and consumer advocacy.

“Among all US metropolitan areas, Florida had seven areas that were in the top 10 in the country,” for foreclosures, said Amy Baker, chief economist for the Legislature.

The number of foreclosure filings rose by more than 53 percent in Florida last year, giving the Sunshine State the highest foreclosure rate in the nation. On average, it takes about 850 days for a foreclosure to run its course in Florida, according to a report released Thursday by Baker’s office

A high rate  of long-term unemployment, a tight credit market and off-peak home values are contributing to state’s mortgage delinquency problem, Baker said.

A “faster foreclosures” bill filed earlier this month aims to speed up the state’s sluggish home-repossession process. Currently, there are more than 300,000 homes in foreclosure and at least 285,000 foreclosure filings are expected in fiscal year 2013-2014, according to the Office of Economic and Demographic Research.