• 22
  • October

A recent article in The Wall Street Journal discusses the current problem of pending foreclosure cases jamming a court system unable to handle such a volume. Florida is one of the 23 states where a judge is required to sign off on foreclosures. Florida's courts are particularly jammed with cases as the state has one of the country's highest rates of foreclosure, with 476,000 loans in foreclosure at the end of the second quarter of 2010.

Last week in the Sixth Circuit of Florida, which includes Tampa and Clearwater, lenders cancelled about half of the week's foreclosure cases. So now cases have slowed, but the backlog has remained. The backlog of cases was already so large that the Florida legislature gave $9.6 million to the courts to rehire retired judges to help clear cases. The system has become more of a mess due to banks' cancelling court dates of hundreds of foreclosure cases in order to redo shoddy paperwork.

Even though Bank of America and GMAC have resumed processing loans and say that they have not found widespread problems with paperwork or any homes that were foreclosed upon in error, many cases are still jammed or canceled, making the courts and lenders in an even bigger hurry to process them and move on.

Facing such an overwhelming volume of foreclosure cases is what lenders say led them to take shortcuts in paperwork in order to get through as many cases as possible as quickly as possible. Even as banks have restarted their foreclosure proceedings, many are wondering whether the problems have actually been fixed or merely compounded.


Foreclosures Jam the Court System (The Wall Street Journal)