Consumer Protection Law.

CS/HB 643--Foreclosure Fraud

This bill creates consumer protections for homeowners who are in default on their mortgages, in foreclosure, or at risk of losing their homes due to nonpayment, and such homeowners find themselves securing services from foreclosure-rescue consultants or equity purchasers. In the course of offering or providing foreclosure-related rescue services, a foreclosure rescue consultant is prohibited from: initiating services without first executing a written agreement with the homeowner; or collecting or securing payment before completing or performing all agreed upon services. For homeowners who secure services from foreclosure-rescue consultants, the bill provides that the: nature and specific details of a foreclosure-related rescue services agreement be expressed in writing in 12-point uppercase type; the homeowner be given 1 business day to review the agreement prior to signing; the homeowner be given a 3-business day right to cancel without penalty, which may not be waived by either party; the date of the agreement must not be earlier than the date the homeowner signs; the consultant must return any payments received from the homeowner within 10 days after receipt of a notice of cancellation; and the notice of cancellation must be printed immediately above the signature line in 12-point uppercase type in a specified format. Re homeowners who conduct business with an equity purchaser, the bill provides that: the nature and entire understanding of the transaction be expressed in writing in 12-point uppercase type completed and executed by the parties prior to encumbering or conveying an interest in the residence in foreclosure; a homeowner must receive a copy of the completed agreement within 3 hours after signing; the transaction agreement must state the specifications of any option or right to repurchase the property in foreclosure and must comply with applicable federal regulations; a homeowner may cancel without penalty with notification by 5 p.m. on the third business day after signing the agreement; any money paid by the equity purchaser to the homeowner or by the homeowner to the equity purchaser must be returned at cancellation; the right to cancel may not be waived by either party (at the time an agreement is signed, a notice of the homeowner's right to cancel is provided); a homeowner with a right to repurchase the property has a 30-day right to cure any default on three separate occasions (this right must be included in the written agreement); an equity purchaser fully assumes or discharges any liens; an equity purchaser must verify and demonstrate that a homeowner with a right to repurchase has the ability to make the required payments in order to exercise the repurchase option; a rebuttable presumption exists that the homeowner has a reasonable ability to make the required payments to repurchase the property, provided the homeowner's monthly expenses do not exceed 60 percent of the homeowner's monthly gross income; the price to repurchase must not be unreasonable (a rebuttable presumption arises between the equity purchaser and the homeowner if the repurchase price is greater than 17 percent per annum more than the total amount paid by the equity purchase, except under certain circumstances). The bill also provides that a rebuttable presumption exists solely between the purchaser and the homeowner for any foreclosure rescue transaction involving a lease option or other repurchase agreement that the transaction is a loan and the conveyance from the homeowner to the purchaser is a mortgage. This provision does not apply to a subsequent purchase unless it is recorded. Further, a person who violates any provisions of the bill commits an unfair and deceptive trade practice subject to the penalties and remedies provided in Chapter 501, Part II, F.S., including a monetary penalty up to $15,000. Approved by the Governor, these provisions take effect October 1, 2008 and shall apply to causes of action accruing on or after that date. Ch. 08-79, L.O.F.

CS/HB 743--Mortgage Fraud

This bill addresses the reassessment of real property involved in the crime of mortgage fraud primarily for profit. The bill creates s. 193.133, F.S., which provides two opportunities for a property appraiser to adjust, if necessary, an assessment of property affected by mortgage fraud, or other fraud involving real property, that may have artificially inflated property values. The bill also increases the criminal penalty for mortgage fraud from a third degree felony to a second degree felony if the loan value exceeds $100,000. Approved by the Governor, these provisions take effect July 1, 2008 and shall apply to causes of action accruing on or after that date. Ch. 08-80, L.O.F.

CS/HB 1037--Escrow Agents

This bill provides that an unauthorized person may not, in connection with the purchase and sale of real property: transact business using the term "escrow" or words of similar import; or circulate, simulate, or advertise that the business is regulated as an escrow agent. These restrictions do not apply to: certain financial institutions; attorneys; persons licensed pursuant to chapter 475 (real estate brokers, sales associates, schools, and appraisers); title insurance agents licensed pursuant to s. 626.8417, F.S.; a title insurance agency licensed pursuant to s. 626.8418, F.S.; or a title insurer who is authorized to transact business in this state pursuant to s. 624.401, F.S. Any person aggrieved by a violation of the bill provisions may seek a declaratory judgment to recover actual damages, plus attorney's fees and court costs. Further, a willful violation by any person is a misdemeanor of the first degree. Subject to the Governor's veto powers, the effective date of this bill is July 1, 2008.