Recent Updates
April 28, 2010
State Must Prove Defendant's Knowledge of Driver's License Suspension
April 13, 2010
Sentencing Commission Votes to Eliminate Recent Criminal History Points
October 15, 2009
Consent to search inside of vehicle does not extend to locked containers
October 14, 2009
Making phone calls to get drugs for personal use not a felony
October 07, 2009
Duval County schools agree to reduce number of students getting arrested
Misconceptions about how Helping Families Save Their Homes in Bankruptcy Act Bill will affect house prices in Jacksonville, Florida
March 12, 2009
Topic: Bankruptcy
In February the House passed H.R. 1106 (Helping Families Save Their Homes in Bankruptcy Act 2009). It is predicted that the bill will pass the Senate solely on the backs of Democrats. Republicans have not made a decision about whether they would filibuster the bill, but that seems unlikely. The greatest misconception is that judges will be able to arbitrarily decide what a home's value is worth. Some bankers have gone as far as to say that judges will be shills for the homeowner and simply mark the house down to a level that would "make the homeowner happy."
Nothing could be further from the truth. The courts will conduct hearings in the same way they do now in considering the value of something in all Chapter 13 proceedings. First, the underlying debt is established. Second, the Trustee, debtor, and or the Bank may present evidence about the current value of the item. Despite the lower value of homes in general, sales of houses has actually increased in the Jacksonville area in recent months as foreclosures and distressed sales have actually caused the number of sales in increase. Increases in the number of sales make it easier to establish a market because there are more comparable sales to derive at a fair present value of the asset.
Moreover the value at which the home can be kept with the homeowner is less than what the bank could get at a foreclosure sale or a short sale. The bank would then be able to mark the asset and help bring a close to the process more quickly. Currently, banks are so far behind in getting foreclosures through the State courts that many persons in foreclosure are able to stay in the home without paying any mortgage payments for months and sometimes more than a year.
In a Chapter 13, a debtor must make their first payment towards their debt within 30 days of the filing of Chapter 13. Therefore, the debtor begins making payments and the bank can start receiving money more quickly in Chapter 13 reorganization than it would under a foreclosure.
Jacksonville bankruptcy Judges Paul Glenn and Jerry Funk will be addressing those issues at the Ralph W. "Buddy" Nimmons, Jr. Federal Practice Seminar in Jacksonville on April 23rd. I will report on their comments after the seminar about how they believe this bill may be enforced in the Jacksonville bankruptcy division of the Middle District of Florida.
