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…)
Posts Tagged ‘Massachusetts’
For the second time in as many years, a foreclosure mediation program has faced a constitutional challenge. This time, the 153,000-person city of Springfield, Massachusetts, will be allowed to move forward with a foreclosure mediation program for residents.
The first was a constitutional challenge from Wells Fargo against the Nevada Supreme Court Foreclosure Mediation Program. Wells Fargo claims the mediation program itself violates the due process clause. More specifically, Wells Fargo claims a provision that allows sanctions for non-compliance, violated the U.S. constitution. Nevada’s mediation program allows judges to issue sanctions if the lender does not participate in good faith. Sanctions may include an ordered write-down of the mortgage. Wells Fargo says this violates the contracts clause and the takings clause by interfering with a contract provision and appropriating private real and personal property for public use without compensation. The court (more…)