release

So how come I never met this guy? He lives in Florida, is an FSU fan, a Mac user, and a Halo player. I’m sure we’d get along famously.

My Orlando friends have some ’splainin to do.

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NOTE: I’m writing more about this at the Florida Foreclosure Fraud weblog.

Florida’s new Foreclosure Rescue Fraud law

Last week, Florida Governor Charlie Crist signed a new law which imposes broad-ranging restrictions on so-called “foreclosure rescue” service providers. The well-intentioned bill is meant to curb the worst abuses by bottom-feeding predators who use foreclosure as an opportunity to bilk money and property out of desperate homeowners. But some unintended consequences of the bill may leave homeowners out of luck when it comes to seeking legal representation.

Some of the protections in the new law will prevent con-artists from “rescuing” homeowners by signing them into predatory loans, getting them to sign over their property unwittingly, or just pocketing a fee to negotiate with the lender and then disappearing. Unfortunately, the broad scope of the law also means it applies some strict new regulations on Florida lawyers who are actually trying to help these homeowners – regulations which may prevent these homeowners from having access to any lawyer at all.

Scope of the new law

The new law, Fla. Stat. § 501.1377, [pdf] applies to all “foreclosure-rescue consultants” who provide homeowners with “foreclosure-related rescue services.” Those services include any service related to “Stopping, avoiding, or delaying foreclosure proceedings concerning residential real property” or “Curing or otherwise addressing a default or failure to timely pay with respect to a residential mortgage loan obligation.”

This broad definition appears to include lawyers who would represent homeowners defending a foreclosure suit; it may also encompass bankruptcy attorneys who help homeowners file for bankruptcy during foreclosure proceedings.

Disclosure and cancellation requirements

Among the requirements in the new law, these attorneys who may fall within the definition of “foreclosure-rescue consultants” would have to provide their prospective clients with written agreements containing certain disclosures – in uppercase type, no less – and also state “the exact nature and specific detail of each service to be provided,” and “the total amount and terms of charges to be paid by the homeowner for the services.” The “consultant” must also provide a copy of the agreement to the homeowner “not less than 1 business day before the homeowner is to sign the agreement.” The homeowner also has a three-day right to cancel the agreement after signing it.

The written disclosures and cancellation rights are minor impediments, but still, they present problems for the lawyer who might represent a foreclosure defendant. First, without spending time reviewing the documents, it may not be possible to determine in advance the “exact nature” of the services to be provided. And for lawyers who might bill hourly, it is not at all possible to calculate the total charges to be paid until the work is actually done. It would be difficult, if not impossible, for many lawyers to take on new clients if they had to comply with these requirements.

Also, the one-day advance copy requirements and the three-day cancellation requirement, effectively mean that any homeowner facing an immediate deadline may not be allowed to hire a lawyer. Have a court deadline tomorrow? Sorry, you can’t hire a lawyer until a full business day has passed. Have a court deadline in two days? Sorry, but most lawyers won’t enter a case until after the three-day cancellation notice has passed. (Otherwise, the court might not let them out of the case if the client cancels.) A homeowner who needs a lawyer in a hurry will have a hard time hiring someone before time runs out.

Deferred fee requirements

Besides the written agreement, the new law also forbids the consultant from asking for or accepting any fees from the homeowner “before completing or performing all services contained in the agreement for foreclosure-related rescue services.” What does this mean? It means that a lawyer who takes on a foreclosure defense case can’t even ask for a retainer – a deposit – until after he has already done all the work on the case, which may be months or even years later. It also seems to suggest that a bankruptcy lawyer cannot ask for or accept any fee from their client until after the bankruptcy case has concluded – which, my colleagues in that field tell me, means that bankruptcy attorneys effectively waive their right to collect any fees, whatsoever.

What effect would this have on the willingness or ability of lawyers to represent homeowners in foreclosure cases? For most, it means they can’t. To defer a fee on a foreclosure defense until the end of a case not only means they have to wait to get paid, in most cases it means they won’t get paid at all. Once a lawyer has provided his services, he can’t take them back – he has no leverage to persuade a cash-strapped homeowner to pay the bill for services that have already been provided. Faced with the choice of taking a long-deferred fee that might never be received, or refusing to take the case, most lawyers will refuse the case. And then the homeowner has to face foreclosure alone. This is helping?

Aiming at the wrong target

And the worst part is, there’s no need at all to apply these restrictions to lawyers who represent foreclosure defendants. Attorneys who, in good faith, take on these cases and litigate them can provide an enormous benefit to their clients. The rare attorney who takes a fee, pockets it, and disappears, is subject to the strict discipline of the Florida Bar. And, despite the rash of foreclosure rescue scams in Florida and across the nation, I know of none that involve lawyers representing homeowners in court proceedings. By lumping these lawyers in with everyone else, the legislature tried to fix a problem that doesn’t exist.

Is there any hope for the future?

I hope I’m wrong about the scope of the bill, but I’m afraid that it means exactly what I think it means. No doubt the consumer law bar will eventually figure out a way to modify these restrictions, but until then, homeowners seeking legal help are getting the short end of the legislative stick.

CONTACT: Those wishing to reach me about this article can use this web form to send e-mail.

UPDATE: Jacksonville bankruptcy attorney Chip Parker sees this bill the same way.

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Race Report: Miles for Moffitt 5K

This was my first race, and I picked it because Dad, a lifelong runner, had this weekend free to run it with me. Miles for Moffitt is in its third annual running at the University of South Florida, and benefits the Moffitt Cancer Center which is affiliated with the university.

To get to the race in time to check in, we had to get up at six, roust the kids, pack the car, and go. Even though Dineen had set out everything the night before (including t-shirts for the kids she made saying “Run Daddy Run” and “Run Grandpa Run”) we got out the door a few minutes later than planned.

When we got to campus, we were amazed at the turnout. Just a few minutes before the close of registration, and there were still hundreds of runners in line to check in. Fortunately, Dad had gotten there early to pick up both our packs and he found me just as I got in line. Even so, they had to push back the start time 20 minutes because they had double the expected registration, mostly at the last minute.

Besides the 5K run, there was also a 1 mile walk/run. As we got our chips and went looking for an alternative to the long porta-potty lines, Dad and I saw a large number of runners or walkers who were there to honor a particular cancer victim or survivor.

We finally made our way to the starting area, and after what seemed like an endless wait, the horn blew and we were off. I knew that there would be a temptation to start faster than normal because of race conditions, and even though we tried to start our at a moderate pace, we did the first kilometer a bit faster than planned. It’s hard to have runners whizzing by on both sides and not try to keep up.

The first mile went pretty smoothly, flat and straight. Dad, who typically runs indoors on the treadmill, had been worried that the late start would make heat a factor, but we were both still doing fine. Our time for the first mile was 9:57.

The second mile, we started to see the hills we had been warned about. That part of the course runs up some long, gentle inclines, ones you wouldn’t even notice if you weren’t running on them. In the second mile and especially in the third, the incline became a factor. At the second mile mark, we had slowed to 10:22.

The last mile was one long hill, a short downhill, and then an uphill climb to the finish. The sun had come up over the trees and that started to bother Dad, while I was struggling with the incline. At two separate points we had to stop and walk for a minute, but we made the last turn major turn and then suddenly, saw what looked like the finish. Runners around us started their kick, and we did too.

At that point, I thought, “Wait, isn’t that the same place we started? I thought the finish was over by the parking lot?” But as the runners spread out and sped up around us, we kept kicking. Under the balloon arch, across the mat, and we slowed to a walk, along with several other runners.

“Keep going!” The volunteers pointed to the *other* balloon arch, about a tenth of a mile away. Wait, they sent us back through the Start, which looked just like the Finish, and didn’t warn us? We swore, and picked it back up to a trot towards the finish. I kept my eyes open for Dineen and the boys.

Across the mat, under the arch, for the genuine finish, and Dineen was on the side with her camera. The boys were excited to see us and we were happy we had made it. Final time, according to my Nike+, was 32:04, with a third mile split of 11:10.

Since this was my first race, my main goal was to finish, have fun, and spend time with family. I also now have a little bit better understanding of how these events work so that my next race (next week) I’ll be a little bit better prepared mentally. This race, then, was a huge success.

UPDATE: Official times posted. Looks like our actual run time was 31:59 for Dad and 32:00 for me. Not too bad, for a first race.

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Having trouble selling your home in this sagging real estate market? Clementina Marie Giovannetti of Ocala, Florida, apparently was, too.

So she’s decided to give her $1.25 million mansion away.

Crazy? Don’t answer yet.

She’s having a contest, and the submission of the winning “Pet Lover” essay gets the house. Contestants have to write a 300-word essay and submit a “4×6 color photograph of the pet” in question, and… a $200 entry fee.

Still, $200 for a shot at winning a mansion? Could be a great deal. But here’s the catch. The contest only goes on if 6250 people enter. If not, she has the right to cancel the contest and return everyone’s application fees (minus a $20 “administrative fee” per Entrant.)

So let’s do the math. 6,250 entrants at $200 each yields - $1.25 million. (Hey! What a coincidence!) If the contest goes bust and she gets, say, only a thousand entrants, cancels the contest, and keeps the $20 administrative fee, that’s $20,000 (minus legal fees and postage, presumably.) And no matter what, this author gets a hell of a lot of publicity because she’s posted the contest information on her main web site where she hawks all her books.

Win-win-win, if you’re Giovannetti or her lawyer. I wonder if they came up with the idea, or, as seems more likely, they adapted it from something they found somewhere else.

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At 7:30 this morning I did something I haven’t done since I was in high school, and as far as I can remember, I’ve never done before breakfast.

I ran four miles. In a row. Without stopping.

On purpose.

No, there was no one chasing me. Near the end of February, I had taken the boys to watch a wrestling tournament at Brandon High School. (Yes, the same fateful tournament featured in The Streak.) Watching those matches, I felt some of the old competitive juices flowing again. What if I got back in shape? Could I maybe step back on the mat, reclaim a little bit of what I once had?

The first step was the hardest. I got on my running shoes, went out the door, and ran about two hundred yards before I stopped, wheezing and spent. But somehow, I kept going.

Week after week, I kept going out, building my endurance and distance. I’ve run in the morning, in the afternoon, in the evening; in town and on the road; once, I even ran with a hangover. As of today I’ve run more than seventy-five miles in about ten weeks.

What does the future hold? Next week I run my first race, a 5K, with my dad. The week after that, another 5K race.

After that, who knows? More miles.

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