(Some) Foreclosure Money Is On Its Way to Homeowners

Nov 2, 2012

Florida is finally going to spend money it was given for foreclosure relief.
Credit 401(K) 2012 /Flickr

Florida-- including South Florida--could finally be getting the millions of dollars it won in a settlement with big banks over bad mortgages and foreclosures. 

In the past several months about $300 million dollars given to Florida has been locked up in a battle between Florida Attorney General Pam Bondi and the state Legislature. Each party claims that they have the authority to decide how the money is spent.

While other states have been using their settlement money to give relief to homeowners hurt by the foreclosure crisis, this fight over who can spend the money has meant Florida has not spent a dime of that money.

However, that changed today.

According to The Miami Herald/Tampa Bay Times:

Florida Attorney General Pam Bondi announced Friday that her office has reached a deal with the Florida Legislature over how to use $300 million in foreclosure settlement money that has sat dormant since March amidst negotiations over spending authority. One-fifth of the money, about $60 million, could be approved in the coming weeks for programs like down-payment assistance, legal counseling for foreclosures and initiatives to help deal with the backlog of foreclosures in state court. The state Legislature will decide how to spend $200 million of the total during the next legislative session, meaning  it will be spent after May. According to the agreement, that money will go to “housing-related” initiatives, a broad term that could include "foreclosure prevention, neighborhood revitalization, affordable housing, homebuyer or renter assistance, legal assistance, counseling and other housing-related programs."

Other states have used that settlement money to fight fraud, help people facing foreclosure or for grants to groups that offer legal aid and housing counseling. South Florida, in particular, was one of the hardest hit areas in the country by the foreclosure crisis.