The Five-Year Foreclosure Statute

• March 30, 2015

by UrbanTurf Staff

Imagine that your home goes into foreclosure, you stop paying your mortgage payments for a number of years and then one day, the foreclosure proceedings are dismissed and the home is yours again. The New York Times writes that this could be a possible reality for a number of homeowners in the midst of foreclosure.

In an article published Sunday, the newspaper details how many foreclosure cases could be dismissed because the proceedings have just dragged on for too long:

“…in a growing number of foreclosure cases filed when home prices collapsed during the financial crisis, lenders may never be able to seize the homes because the state statutes of limitations have been exceeded, according to interviews with housing lawyers and a review of state and federal court decisions.”

The laws vary from state to state. In Florida, lawyers representing homeowners state that there is a five-year window to file for foreclosure following a default, while the banks believe that “the five-year clock resets every time a homeowner misses a monthly payment.”

As for the delays in foreclosure proceedings reaching a conclusion, the article points out that the courts are not the only cause. The government has made almost 70 changes to loan modification programs over the years, causing lenders “to scrap previous offers to homeowners and extend new terms.”

This article originally published at http://dc.urbanturf.com/articles/blog/the_five-year_foreclosure_statute/9700