“WAR WITH THE BANK INDUSTRY”
unit and it further held that, once they do so, State law only requires that banks pay six months of past-due condominium fees or one percent (1%) of the original mortgage amount, whichever is less. Because of this stringent limitation, the amount collected by the condominium association is often far less than the money actually owed on the foreclosed unit.
In the Miami-Dade County alone, an approximate of 64,001 foreclosure cases were filed last year and more than 4,000 are filed each month. Thus, the direct consequences of this ruling, combined with the catastrophic situation in the residential real estate market which has forced many unit owners into dire economic difficulties, are costing condominium associations thousands of dollars in delinquent maintenance fees.
Of course, condominium associations’ problems get worse when faced with banks that are taking a year o more to foreclose, presumably seeking delays intentionally simply to avoid holding title to the foreclosed unit in an attempt to avoid paying condominium associations’ fees as any other unit owner would have to pay.
Condominium associations supported by state representative, Julio Robaina would like to change these laws and limit the application of the above mentioned court ruling in the up-coming legislative session. Robaina proposes to require banks to pay at least six months of past- due condominium associations’ fees at the commencement of a foreclosure proceeding and also to pay a “fair share” of the remaining fees after taking title to the foreclosed unit
On the other hand, Anthony DiMarco, lobbyist for the Florida Bankers Association in Tallahassee, commented that the push to force banks to pay condominium associations’ fees earlier that state law currently requires could back fire forcing banks to stop financing condo purchases. As we all know the lending market is already in bad shape and secondary market lenders Fannie Mae and Freddie Mac have set limits on loans they would acquire if condominium associations have high delinquencies.
As always, the spectrum of personal alternatives and preferences is multifaceted. There are condo owners who really care about their home and do everything possible to avoid foreclosure, others who could mediate with the banks and reset mortgage rates and/or monthly payments and, finally, others who are just not doing anything to fight the foreclosure; meanwhile the court system can take at least a year to get through and finally foreclose upon the property./p>
LThe solution to this ongoing dilemma is certainly not easy; different interests are fighting to gain ground in a market that is not forgiving. However we think that banks have already gotten too many breaks from our government and that condominium associations should probably be helped a little to coast along in these times of trouble.
We will keep you posted on future developments.
Cav. Piero Salussolia , Esq.
Cav. Piero Salussolia, Esq.
Avv. Gemma A. Caterini (admitted only in Italy).
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