Florida homeowners have been served a clear message from both West Palm Beach and Tampa Bankruptcy Judges. Chief Judge Paul Hyman, Jr. in the Southern District of Florida and Judge Michael Williamson in the Middle District of Florida have ruled that struggling homeowners should not be allowed to fight a foreclosure on their home after surrendering it in bankruptcy. This means that homeowners must decide whether they will surrender their property in bankruptcy or save it from foreclosure.
In the judge’s eyes, a bankruptcy allows debtors a clean slate and a chance to start over, not the opportunity for a leg up on creditors in other courts. For these judges, they will not tolerate such “inconsistent positions in federal and state courts.” If homeowners who have surrendered their property to bankruptcy continue to fight state courts to save their homes from foreclosure, they will face harsh penalties. This puts struggling homeowners at a considerable disadvantage.
Many disagree with the judges’ views, stating that debtors who surrender their property to the bankruptcy courts should not have to surrender their home to creditors. The basis for this argument is that there is a strong distinction between the two. However, for Hyman and Williamson, surrender means relinquishing property to “make it available to the secured creditor by refraining from taking any overt act that impedes” foreclosure.
Oftentimes, a bankruptcy will allow a debtor to liquidate their property and use the funds to repay creditors. Underwater mortgages or homes facing foreclosure are often deemed abandoned and it reverts back to the homeowner. Now, with the new case law, lenders receive control of the surrendered property instead of the trustees. This gives lenders the ability to enter bankruptcy court and benefit from homeowner foreclosures.
Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.
Source:
http://www.dailybusinessreview.com/home/id=1202733488406/Bankruptcy-Judges-Clamp-Down-on-Homeowners-in-Foreclosure?mcode=1202617073880&curindex=0&slreturn=20150703180236