• 9 Investigates people turning foreclosures into free homes

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    ORANGE COUNTY, Fla. - Some local homeowners who haven't made a mortgage payment in years are finding a way to keep their homes for free.
     
    9 Investigates discovered how some people are taking advantage of Florida's statute of limitations on foreclosures. And Channel 9 anchor Vanessa Welch found out how it’s allowing some families to go from foreclosure to a free home in just five years.
     
    She talked to Thomas Adams, a man living in a Maitland home with a tennis court and pool. Adams has not paid his mortgage in more than seven years.
    Adams owed the bank more than $140,000, but now lives mortgage free and won't ever pay another dime.  
     
    “It was only right,” Adams told Welch. “It was justice quite frankly”
     
    The initial lender, Federal Home Loan Mortgage filed a foreclosure on Adams' home back in 2008. Later, the loan was transferred to  Nationstar Mortgage.
     
    “They sold my loan so many times no one knew who had the paperwork,” Adams said.
     
    Adams’ attorney, Charles Franklin, with the Freedom Law Firm, succeeded in getting the case dismissed last year. Franklin said, “It would most likely result in a free house.” 
     
    Franklin believes banks have five years to file a foreclosure after an owner defaults and the lender demands the entire balance be paid.
                   
    Because Adams’ case was dismissed after that window, Franklin argues the lender cannot foreclose again. 
     
    However, lenders, including large national banks, say they have much more time to file, arguing the five year clock re-sets every time a homeowner misses a monthly payment.
     
    But Franklin insists that interpretation of the law is illogical.
     
    “They could just keep going on and the case would never end,” Franklin said,
     
    The issue is now before the Florida Supreme Court, which is scheduled to hear oral arguments on the statute of limitations involving foreclosures in October.
     
    No one knows for sure how many foreclosed homeowners might be able to get free homes due to the statute of limitations in Florida.            
     
    RealtyTrac counted more than three million foreclosures filed in Florida since 2007.
                   
    Franklin helped nine families go from foreclosure to free homes last year and expects many more this year.
     
    “I think there will be an absolute floodgate of people who will be able to get their homes for free,” he told Welch.
     
    While some argue it's unfair that some are getting homes for free without meeting the obligations of their mortgages, others, including some of Adams’ neighbors, have little sympathy for the banks.
     
    “If they didn’t exercise their rights when they should have, it's their tough luck. Good for my neighbor,” said Larry Furlong, who lives across the street from Adams.  
     
    Adams, meanwhile, says his heart is failing and he can no longer work. He claims responsibility for falling behind on his payments, but blames the bank for not honoring on his hardship request.             
    He said he doesn’t feel the least bit guilty now.
     
    “I think it is what you would call poetic justice,” Adams told Welch. 
     
    Adams still has to pay taxes and insurance, but it’s much cheaper than his previous payment of $1,400 a month.
    The bank can also keep a lien on his property until the home is sold.
     
    Welch reached out to Nationstar for comment and the lender said in a statement from a spokesman: “Because of customer confidentiality restrictions, I can't get into detail regarding why the foreclosure action was dismissed. However, I can tell you the dismissal of the foreclosure action was for reasons other than the statute of limitations.”


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