Fla. Law Firm Touts ‘Mortgage Terminator’ Suits for Condo Associations
A Miami law firm says its “mortgage terminator” lawsuits are transferring ownership of abandoned properties to condominium associations when banks delay initiating foreclosure proceedings.
The suits filed by the Association Law Group rely on a Florida law that allows condo and homeowner associations to file separate foreclosure actions for unpaid maintenance, the Sun Sentinel reports.
Ben Solomon of the Association Law Group told the Sun Sentinel that it mortgage terminator suits seek to force foot-dragging banks to do one of two things. On the one hand, the bank can release the mortgage and walk away from the property, handing ownership to the condo association. On the other hand, the bank can initiate foreclosure proceedings, take title and pay the condo association past-due assessments.
When an association gets title, the bank holding the mortgage still has the right to pursue the owner, but not the association, Solomon said.
Solomon told the Sun Sentinel and the Orlando Business Journal about two cases in which banks released their mortgages, allowing condo associations to foreclose on the properties. In both cases, the property values had dropped to a fraction of the mortgage owed, and if the banks had foreclosed, they would have owed substantial association fees and court costs.
