Home foreclosures have risen exponentially throughout the United States. Subprime lending, large portions of adjustable rate mortgages resetting in the last few years, and an economic slowdown are just a few of the reasons home foreclosures have reached a torrid pace across the United States.
The State of Florida has not been exempt from the rash of foreclosures, with the second highest number of foreclosures in the United States occurring in Florida.
With the substantial increase in home foreclosures, mortgage lenders, in a haste to foreclose, are making more and more mistakes in prosecuting foreclosure actions. One of the most significant mistakes lenders are making is failing to serve homeowners in foreclosure lawsuits.
The State of Florida prescribes specific procedural steps, in the Florida Rules of Civil Procedure, with respect to filing and prosecuting a lawsuit.
- In a foreclosure, the lender will begin by filing a Lis Pendens and Complaint with the Clerk of the Court. The Lis Pendens serves as public notice that a foreclosure lawsuit has been filed relating to the property being foreclosed.
- The Complaint generally alleges the loan to be in default, declares the principal, interest on the principal, taxes, and other costs and fees due immediately, and seeks a foreclosure judgment and judicial sale of the property.
In order to proceed with the foreclosure lawsuit and obtain a foreclosure judgment and sale, the lender must serve the lawsuit and a summons upon the homeowner. A Florida Sheriff or process server will deliver a Summons, a copy of the Lis Pendens and the Complaint to the homeowner. This second step, Service of Process, has recently been discovered to be a principal area lenders neglect in their haste to push foreclosure cases through the courts.
Because of the overwhelming volume of foreclosure cases being filed in Florida, both courts and mortgage companies are having difficulty ensuring proper Service of Process. In Broward County alone it was recently discovered that in excess of 15,000 filed foreclosure cases were without adequate service of process. See Billy Shields, Foreclosures: Judge grapples with her discovery of 15,000 unserved foreclosure cases (Jan. 24, 2009)
Receiving proper service of process is essential, not only because it's the law, but also because the Summons contains information, including the homeowner's rights and responsibilities regarding the suit, as well as the amount of time allowed to respond to the Complaint.
Service of Process is significant because the Florida Rules of Civil Procedure state that the Service of Process must be made, or perfected, within one hundred twenty (120) days of the filing of the Complaint. Florida Rules of Civil Procedure 1.070(j). If Service of Process is not completed within the allotted one hundred twenty (120) day window, the Court may dismiss the lawsuit.
Because of the many instances where Service of Process is not perfected by the Lender, many individuals facing foreclosure may be able to have the cases pending against them dismissed, based on this technicality. The Court has discretion to extend the 120 day period if the Lender is able to show a good cause or excuse for the failure to serve. Florida Rules of Civil Procedure 1.070(j).
However, in many cases there is no good cause, the lender's delay in serving the lawsuit is simply a matter of the mortgage company's neglect of pending cases. For this reason, many pending foreclosure cases may be subject to dismissal based on lack of service.
Today many homeowners are falling behind in their mortgage payments and confront potentially losing their home. The failure of mortgage companies to properly serve foreclosures presents many issues to the legal system and to homeowners facing foreclosure.
Most significant for homeowners is the opportunity to dismiss pending foreclosure cases based on the lender's failure to serve the lawsuit in a timely manner.
The Kramer Law Firm has extensive experience with defending foreclosure and assists homeowners in resolving mortgage foreclosure problems without the need to file bankruptcy. For additional information concerning foreclosure defense, contact the Kramer Law Firm. Call 407.834.4847