Last week, the Florida Supreme Court decided to unleash a potential tidal wave of “new” foreclosures in the state, but the foreclosures in question are not really all that new. Instead, they’re mortgage foreclosure actions that were dismissed fewer than five years ago where the homeowners in question have once again stopped paying their mortgages or never resumed in the first place.

Florida real estate attorneys predict that the decision will affect “tens of thousands” of foreclosures in South Florida alone. CoreLogic ranked the state first in the country for completed foreclosures in 2015-16, due in part to a fast-track law signed in 2013 by the governor, Rick Scott, that was intended to get foreclosed homes off the court dockets and back into the housing market so that real estate and families experiencing foreclosure could begin to truly recover.

Now this ruling could threaten that recovery.

The case, Bartram et. Al. vs. U.S. Bank National Association (SC14-1265), consolidated several cases against U.S. Bank involving standard residential mortgages. The foreclosure actions against the homeowners had been dismissed and, the homeowners argued, because five years had elapsed since the initial delinquency event, the statute of limitations on the foreclosure had expired and the homeowners should own the properties free and clear.

The Florida Supreme Court, however, ruled that each failure to pay represented a new cause of action for the lender. This means that banks and lenders now have precedent to reopen cases that may have been dropped or dismissed in the furor of the housing and financial crises, specifically the tidal wave of actions that were filed between 2007 and 2009.

While the logic behind the ruling is sound (basically: the homeowners continued to fail to pay their mortgages in the wake of the foreclosure action’s dismissal even though the dismissal did entitle them to resume payments and keep the home, so the bank has the right to foreclose on its collateral), the fallout for the Florida real estate market could be troublesome. The state’s real estate market, already consistently referred to by analysts as a “boom-bust market,” meaning that it tends to operate at one extreme or the other with little intervening time between up- and downswings, will likely become more volatile in the wake of the decision. Lenders certainly are highly likely to attempt to collect on defaulted loans, as will third-party collection companies, which could snarl up the judicial system once again and put many properties in “limbo” once more.


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  • Carole VanSickle Ellis

    Carole VanSickle Ellis serves as the news editor and COO of Self-Directed Investor (SDI) Society, a membership organization dedicated to the needs of self-directed investors interested in alternative investment vehicles, including real estate. Learn more at or reach Carole directly by emailing

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