Group wants foreGroup wants foreclosure fraud settlement money for affordable housing programs closure fraud settlement money for affordable housing programs
Attorney General Pam Bondi has discretion on how to spend $300 million from a foreclosure fraud settlement, and the Sadowski Coalition wants her to spend at least one-third of it on affordable housing.
Lawmakers again swept document stamp tax funds this year that were supposed to go toward affordable housing programs, but a multi-state foreclosure fraud settlement has given groups supporting those programs new hope.
Florida will receive $8 billion as part of a $25 billion multi-state settlement with five of the nations’ largest banks: Bank of America, JP Morgan Chase, Wells Fargo, Citigroup and Ally Financial. The vast majority of those funds will go toward principle reduction on mortgages, cash payments for victims of suspicious foreclosure practices and refinancing for underwater homeowners. But the state also will get $300 million in discretionary funds to spend on housing.
Members of the Sadowski Coalition, an association of business groups and charities for the poor and elderly dedicated to securing funding for affordable housing, met with staffers for Attorney General Pam Bondi last month, urging them to spend at least $100 million on affordable housing programs like the State Housing Initiative Program (SHIP) and State Apartment Incentive Loan program.
That $100 million is a little more than the $98 million in document stamp funds — a tax on real estate transactions and other legal documents — that were swept from the affordable housing trust fund by the Legislature this year – a common practice for lawmakers even before the recent recession led to budget shortfalls. The money from the foreclosures settlement represents a second chance for the affordable housing programs to receive funding.
Bondi’s office put out a news release last week asking for public input on how to spend the discretionary settlement money, and so far has received more than 1,000 comments. The period for public comment ends Monday.
Unlike other states that have spent settlement funds to fill budget holes and special projects, Bondi’s office says there are parameters on how this money will be spent: It will only go to aid the housing market in Florida that was ravaged by rampant foreclosures resulting from the burst of the housing bubble in 2008. And that could include spending on beefing up law enforcement capabilities to fight foreclosure fraud, housing counseling, legal assistance, anti-blight programs and foreclosure mediation and assistance hotlines.
Paladin Securitization Auditors Comments:
As we’ve seen across the nation with this settlement, the funds are not directly going to the victims of the foreclosure crisis. States have been consistently using the money to fill budget holes with no repercussions. I have little faith in the State of Florida that they will be able to effectively provide the victims of this foreclosure crisis the monetary settlements they deserve.
One thing that homeowners should be aware of is that most of these programs that provide payouts for the foreclosure crisis may require them to sign away their rights to pursue any additional legal action against the lender. There has been no discussion or hard evidence suggesting what type of settlement money victims will receive. Our guess, is that it won’t come close to the amount needed to cover the loss of their homes, their moving expenses for their foreclosure, and the emotion pain and suffering they endured.
Using a securitization audit to mount a foreclosure defense case may be a better option and doesn’t require you to waive any rights to the settlement in this article.
The securitization audit is a phenomenal tool that is considered legal evidence and is extremely underused.
A securitization audit, when performed by an experience securitization auditor, will find violations in process of securitizing your home loan. These are Securities Exchange Commission (SEC) violations and are considered federal offenses. There’s a lot of leverage here for a homeowner if their loan was securitized and fraud has been found in a securitization audit. Our clients have been successful in using our audits to help them:
- Leverage their bank for a loan modification
- Obtain a principal reduction
- Invalidate their notice of default (postpone, delay, or forego their foreclosure sale)
- Sue their lender for punitive damages
Paladin Securitization Auditors offers a free securitization fraud evaluation
Simply fill out the form on http://www.paladinwestcoast.com and one of our experienced auditors will review your mortgage documents to see if a securitization audit can help your specific situation. Paladin Securitization Auditors has a 100% track record in finding fraud in every single file they have taken on.
Here’s a quick video that will provide you with some tips to see if your loan has been securitized: