TALLAHASSEE, Fla. – June 9, 2009 – The cost to file for a foreclosure in Florida courts just took a sizable jump due to legislation that takes effect this month.
Banks and other lenders will have to pay for the fee increase, which is part of a package of laws predicted to generate $220 million for the state’s court system.
Prior to June, the filing fees were $295 and they are not set at a sliding scale. For properties valued at less than $50,000, the fees increased to $395. For homes and businesses between $50,000 and $250,000, new fees are $900. And for properties over $250,000, fees jumped to $1,900.
Circuit Judge Cynthia Z. Mackinnon said the increase was the largest in “many years” but is understandable considering the state’s financial woes. She supported the Legislature’s decision to tie the increase to the amount of the defaulted loan.
While some experts have said the fee increase might make lenders more reluctant to legal actions on defaulting property owners, Greg Hallam, former president of the Mortgage Bankers Association of Florida, said the new fees mean more to the state coffers than to banks.
“I honestly don’t think that would matter to a bank,” Hallam said. “The new fees are minimal to banks. If you can get out of a foreclosure with less than a $20,000 loss, it’s a party.”
The state is home to one of every six loan defaults in the country, according to California-based RealtyTrac, with 119,200 foreclosure-related court filings during the first quarter alone. State court officials have said Florida has a backlog of more than 300,000 cases clogging the judicial system.
There are alternatives to losing a home in foreclosure, Mackinnon said. “The Ninth Circuit’s mediation program, stimulus money and these increased fees will hopefully all work to both parties’ advantage, and more of these cases will get worked out,” the judge said.
Copyright © 2009 The Orlando Sentinel, Fla
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