Resolution Systems Institute is proud to share its latest publication, Saving Homes, Building Understanding: An Evaluation of the Eight Foreclosure Mediation Programs Funded by the Illinois Attorney General. This new evaluation looks at four-plus years of data across eight different programs to provide a comprehensive analysis of foreclosure mediation in Illinois, and to highlight how differences in program models impacted outcomes. (more…)
Archive for the ‘Foreclosure Mediation’ Category
August 31, 2018, will mark the end of an era at RSI. Our five-year foreclosure mediation grant from the Office of the Illinois Attorney General will come to an end.
This grant, which we received 15 years into our operation, was our opportunity to prove that when given sufficient resources, RSI could deliver the kind of quality court mediation program that we had been recommending to others all those years. I used terms like “practice what we preach,” “proof is in the pudding” and even, “put up or shut up!”
At that time, we promised to:
- Work with courts and other stakeholders to design and operate three foreclosure mediation programs in three judicial circuits in northern Illinois
- Develop and conduct training for mediators in our programs and those operated by our partner organizations farther downstate
- Develop an online system to collect data about the programs enabling us to produce regular statistical reports and two comprehensive evaluations
I am happy to report that we delivered!
In the process, we confirmed some maxims about how to do quality court ADR and added a few corollaries.
- Study first
Before we start working with a court on their ADR program, we update our knowledge of the particular area in which we will be working. In this situation we researched what was happening across the country with foreclosure and how courts were using alternative approaches.
Corollary: Sometimes you have to build the plane while flying it. In the midst of a national foreclosure crisis, courts across the country were scrambling to keep up. While it was helpful to see what others were doing, we needed to figure out how to do foreclosure mediation in a way that worked in Illinois courts with their particular needs and resources.
- Work with stakeholders
We know that it is critical to bring together all the stakeholders while developing a court ADR system so that their various needs can be considered. In foreclosure mediation, the usual stakeholders – judges, court administrators, mediators and lawyers for both lenders and borrowers – were joined by a new addition: housing counselors, who were critical to the success of many of the programs.
Corollary: As important as it is to have all the voices heard, in the end, judges often have to make decisions about exactly how court ADR programs will work, and these decisions may not satisfy everyone. Fortunately, RSI doesn’t “have a dog in the fight,” so we can offer unbiased, expert advice about pros and cons of various approaches.
- Value the people who do the work
Never underestimate the importance of visible, capable staff. These programs are being continued because of dedicated program coordinators, who kept the cases moving and kept the courts informed of program progress, and because of skilled mediators who worked with intelligence and compassion in the midst of foreclosure – which is a crisis for each homeowner, even once the nation’s crisis has abated.
Corollary: These programs are not easy to administer. Juggling spinning plates is an apt metaphor for the challenge of administering programs with sometimes complex court rules that apply to everyone from sophisticated lawyers to overwhelmed homeowners.
- Collect and use reliable data
Turning data into meaningful information means different things to different stakeholders at different times. In the foreclosure mediation programs, we produced everything from monthly statistical reports for judges about numbers of cases in their programs and how they were being resolved to a mega-evaluation of all the programs that compared strengths of the various approaches and made recommendations about how each might improve.
Corollary: In a situation like this one in which every program was different, finding ways to make “apples to apples” comparisons was critical. Doing that successfully allowed RSI to make recommendations for improvement from a place of knowledge, not opinion.
Success and a New Era
September 1st will mark the beginning of a new era, as all three of our foreclosure mediation programs continue to operate thanks to the support of their local courts! We take this as the surest sign of success, that the courts value these programs enough to find a way to continue them when outside funding ends. We are grateful to the Attorney General for supporting these programs, to courts for their partnership and to the skilled mediators for conducting the mediations. We are pleased to continue to provide services to homeowners and their lenders when foreclosure looms.
In August, we reported that the Nevada legislature revived the state’s foreclosure mediation program by passing Senate Bill 490. One of the most notable changes Senate Bill 490 brought to the program included the transfer of program management duties from the Nevada Supreme Court to the Nevada District Courts and Home Means Nevada, Inc., a state affiliated non-profit that was created to address challenges and needs of distressed homeowners. As Home Means Nevada describes, under this new structure when an individual receives notice of default, they will then petition the District Court to participate in mediation. The District Court will then assign a mediator to mediate the case and Home Means Nevada will work closely with the courts and mediators to ensure a successful program.
This month, Home Means Nevada announced that it has selected Hope LoanPort’s® (HLP) web-based platform as the designated channel to administer the program. Founded in 2009, HLP was initially created to help solve the foreclosure crisis by developing a web portal where non-profit credit counseling agencies, attorneys and homeowners could apply for a loan modification or other solution. Today, the HLP platform has become a one-stop shop for homeowners nationwide to send documents to their mortgage companies. As Business Wire reports, the HLP portal will be the designated channel through which Home Means Nevada will administer the foreclosure program. As United Trustees Association reports, the HLP portal will streamline the document sharing process and will afford parties the opportunity to see and receive updates for their case in real time.
The HLP platform will be implemented in several stages with the first phase scheduled to launch July 1, 2018. The HLP Nevada Foreclosure Mediation page can be accessed here and contains updates, information on registering, and access to HLP platform training for counselors, servicers, and attorneys.
Rhode Island and Connecticut May Soon Be Without Foreclosure Mediation Policies if Legislature Intervention is UnsuccessfulNicole Wilmet, June 6th, 2018
The future of both Rhode Island and Connecticut’s foreclosure mediation policies are currently in the hands of their respective state legislatures. Both states have sunset provisions looming on the horizon with the Rhode Island Foreclosure Mediation Act set to end on July 1, 2018 and Connecticut’s foreclosure mediation program set to end June 30, 2019.
Enacted in 2013, the Rhode Island’s Foreclosure Mediation Act grants homeowners who face foreclosure the opportunity to meet with their lender and an independent mediator to try to work out a solution to avoid foreclosure. According to the Providence Journal, since 2013 the Foreclosure Mediation Act has helped 679 families stay in their homes. In an effort to keep foreclosure mediation, earlier this year, Sen. Elizabeth Crowley, Sen. Paul Jabour, Sen. Harold Metts, and Sen. Ana Quezada sponsored a Senate’s version of the bill that would extend the sunset provision to July 1, 2023. In the House, Rep. Susan Donovan, Rep. Raymond Johnston, Rep. Mary Messier, and Rep. Michael Morin sponsored the House version of the bill that would repeal the sunset provision entirely. Currently, the Senate voted and passed their version of the bill on May 23, 2018, but the House Judiciary Committee recommended earlier this month that their version of the bill be held for further study.
The Connecticut legislature is also working to extend the life of their state’s foreclosure mediation program. The Connecticut foreclosure mediation program began in 2008. As this article from the Hartford Courant highlights, between the program’s inception on July 1, 2008 to December 31, 2017, the program has heard 27,958 cases. Of these cases 70% resulted in borrowers staying in their homes, 16% reached agreements for a short sale or other measure, and only 14% did not settle. Like the bills in Rhode Island, there are two versions of an act that would either extend or eliminate the sunset provision making their way through the Connecticut legislature. Both versions of the bill are sponsored by the House of Representatives Banking Committee with the most notable difference between the two bills being the treatment of the sunset provision. The House version of the bill the bill would eradicate the sunset provision for the program entirely whereas the Senate version would extend the sunset provision to December 31, 2019. Given that the sunset provision doesn’t expire until 2019, the Connecticut legislature has more time to save their foreclosure mediation program than Rhode Island.
In compiling the latest statistical report for the eight foreclosure mediation programs funded by the Illinois Attorney General, RSI discovered that, as of last year, the programs helped over 1,000 Illinois homeowners stay in their homes. That’s a tremendous accomplishment and much is owed to the talented program staff that administer these programs, the neutrals who mediate these cases, the housing counselors and legal aid attorneys who advise the homeowners, and the Office of the Attorney General whose belief in the power of mediation made this all possible.
About a quarter of the cases, and 5% of the total foreclosure filings, end in retention. While that might not sound like much, it’s worth bearing in mind that in many instances, there is a significant power imbalance between the homeowner and their lender. That fact makes it quite possible that without the guidance provided by the housing counselors and attorneys, and the channels of dialogue between borrower and lender opened by the program staff and mediators, these homeowners would have very little chance of prevailing in the traditional judicial foreclosure process. Therefore, a retention rate of that magnitude is a tremendous victory. (more…)