Nationwide Look

Posted on Thursday, February 24, 2011

A detailed report on foreclosure mediation programs nationwide from the Center for American Progress (CAP) states that the number of jurisdictions with foreclosure mediation programs has increased from 11 to 21 in a year. Pending legislation in additional states will boost the number further. The report recommends that states with opt-in programs should move to use of mandatory mediation and that states with coverage in only certain cities or locations should expand statewide. Further, the report urges that states without programs in place move swiftly with legislation or judicial rules to implement mediation programs and that mediation services also be added at the federal level. American (June 29, 2010); Full Report

The Obama Administration released its first monthly housing scorecard to track housing market indicators and federal efforts to prevent home foreclosures. Housing (June 21, 2010); Housing Scorecard (June 21, 2010)

The Circuit Court of Cook County launched a court-based foreclosure mediation program to address the rising foreclosure rate. Moreover, the county – Illinois’ largest – approved a $3.5 million budget last Fall to provide free foreclosure mediation services to homeowners. A coalition of community organizations is now launching a major outreach effort, going door-to-door to homes facing foreclosure to explain the details and encourage participation in the county’s optional mediation program. In addition, pro bono attorneys are currently being trained to guide homeowners through the mediation process. Pioneer (April 29, 2010); Progress (June 29, 2010)

Palm Beach County, Florida homeowners can mediate foreclosures that are filed on or after July 12, although they can choose to opt out of mediation. The mediation program is being run by the Palm Beach County Bar Association. Mediation is free for homeowners, but lenders must pay $750, which also covers a financial counselor and administrative costs. One mortgage company is enthusiastic and reports success in about 75% of their foreclosure mediations. Others are more skeptical about whether mediation will just further delay the foreclosure process and, on the other side, whether lenders have any motivation to settle. Palm beach (July 7, 2010)

California legislation to establish a mediation program to help homeowners and lenders agree on sustainable loan modifications passed the Assembly Appropriations Committee. The legislation intends to establish a mediation program similar to those in Nevada and Connecticut. California Newswire (June 1, 2010)

Legislation has been introduced in Connecticut to extend the state’s successful foreclosure mediation program by an extra year, to 2012. However, the source of funding for the additional year will not be determined until later. The bill would also bar banks and servicers from charging late fees or other charges if they do not come to mediation sessions or are unprepared. Hartford Courant by Keith Seat

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