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Just Court ADR

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Posts Tagged ‘foreclosure mediation’

Notable Updates from the World of Foreclosure Mediation

Shawn Davis, August 15th, 2013

There have been some interesting new developments in the arena of foreclosure mediation recently. These developments and rule changes signal that jurisdictions continue to recognize the important role that mediation can play in the housing crisis recovery and that programs are being refined to ensure greater efficacy and efficiency.

First, in the Chicago area, the Chancery Court of Cook County has amended its rules that affect mortgage foreclosure mediation. Effective August 1, 2013, these new procedures are designed to streamline the foreclosure mediation process and make it more effective. For example, parties are now required to exchange and review all documents prior to referral to mediation. Homeowners must submit financial documents and the lender must review them in a timely manner in order for the process to move forward. The goal is that when mediation occurs, both parties have the information they need to make decisions and work toward an outcome. (more…)

Thinking about Mediation’s Role in Mortgage Modification Success Rates

Shawn Davis, August 6th, 2013

On July 24th a report was released by the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) that gave an update on the success rates of homeowners participating in the Home Affordable Modification Program (HAMP). HAMP is a federal government program designed to help homeowners impacted by financial hardship by modifying their monthly mortgage payment. For homeowners who are eligible, the modification permanently changes the original terms of the mortgage. The report shows that of 1.2 million homeowners who received a HAMP permanent modification since the beginning of the HAMP program, 26% had redefaulted. Moreover, the more time that had passed since a homeowner had received a HAMP permanent modification, the more likely they were to have redefaulted, with the oldest HAMP modifications from 2009 at a 46% redefault rate. (more…)

Oregon Senate Passes Bill to Expand Foreclosure Dispute Resolution

Jennifer Shack, April 24th, 2013

Last year, Oregon created a dispute resolution program for non-judicial foreclosure cases. The program didn’t work as well as hoped. The program’s start coincided with an appeals court decision that pushed foreclosures into the judicial system. That, along with some issues with the legislation enacting the foreclosure dispute resolution program and lender reluctance to participate, led to very few cases being mediated. A lot of work has been done since then to find ways to encourage use of dispute resolution. The effort that appears to have gained the most traction is to expand the foreclosure dispute resolution program to include cases going through the judicial process. (more…)

Mediation Saves Mediation in Massachusetts

Jennifer Shack, March 14th, 2013

In an appellate mediation over the fate of a mediation program, two sides have agreed to preserve mediation. Back in 2011, Springfield, MA, passed two ordinances to deal with the foreclosure problem in the city. The first instituted a mediation program. The second required lenders to post a $10,000 bond for any foreclosures filed for vacant properties. Lenders filed suit in U.S. District Court, where the judge affirmed Springfield’s right to mandate both the bond and mediation. You can read about the rationale for both the suit and the court’s decision here. The lenders appealed and the two sides voluntarily entered mediation. (more…)

Counting Up the Costs and Benefits to Lenders of Foreclosure Mediation

Jennifer Shack, November 19th, 2012

Is foreclosure mediation a positive or a negative for lenders? An open letter from Connecticut’s Congressional delegation to the Federal Housing Finance Authority (FHFA) provides sound evidence that it’s a financial positive for lenders to participate in a well-functioning mediation program. FHFA, which regulates Fannie Mae and Freddie Mac , is proposing to increase guarantee fees for mortgages in Connecticut, Florida, Illinois, New Jersey, and New York, stating that laws and procedures enacted in those states have extended the foreclosure process and increased the costs of foreclosure on Fannie Mae and Freddie Mac. (more…)