What is Foreclosure Mediation?

Asked over 1 year ago - New Port Richey, FL

Is foreclosure mediation something like modification? And does the bank pay for the service, and is it really worth it if your home is upside down? Thanks for your time.

Attorney answers (4)

  1. Andrew March Lyons

    Contributor Level 8

    4

    Lawyers agree

    Answered . A mediation is a meeting of all parties, with a mediator, and the attempt is to settle the case. Typically, I sue the mediation as a way to get a loan modification for my clients. Most of the time, my clients owe more on the home than it is worth, so yes, they are upside down. The modification seems to depend more upon your financial status than the value of the home or what you owe. An experienced attorney will know exactly how to handle this situation, as I have an entire division of my law firm dedicated to the modification process.

  2. Leonore M. Greller

    Contributor Level 12

    4

    Lawyers agree

    Answered . Yes, foreclosure mediation is something like modification because it is the meeting at which your modification is discussed. A mandatory Residential Foreclosure Mediation Program was instituted by the Florida Supreme Court in all counties for " homesteaded" properties in late 2010. In 2012, the mandatory Program became " discretionary" with each Chief Judge of each Circuit Court. The Chief Judges in the three Circuits that I mediated for the Residential Program terminated the Program. Now, in these circuits, one must request mediation by motion or before the Judge in a foreclosure action .
    If you want to try and save your homesteaded property, you can ask the judge in a foreclosure action for mediation and find out if there is a mandatory mediation program in your county/circuit. The bank pays for the first mediation session with all paperwork in hand and if qualified you may be offered a modification in that session The attorney for the bank, the bank on the phone, the homeowner, homeowner attorney (if represented) and the mediator are part of the mediation process.
    The question of whether to have a mediation is one for you to answer. Do you want to keep your home? How far behind are you, if at all? Are your taxes and insurance current? Homeowner dues current? Can you afford to keep your home if the payments are reduced to between 31% (Fannie Mae and Freddie Mac loans) and 25% (new guidelines for some banks that have private loans) of your gross income (what you get paid before taxes, etc.).

    This communication is not intended to create an attorney/client relationship. It is always recommended you consult... more
  3. Preston Hall Oughton

    Pro

    Contributor Level 11

    3

    Lawyers agree

    Answered . A mediation is sometimes requried in litigation before the case can move forward towards trial. Both parties typically share the cost of mediation. Mediation can be helpful if the parties truly want to settle the matter without having a court decide it for them. Foreclosure mediation has not been overly successful in my experience because the lender either 1) wants the borrower to catch up the payments and the borrower does not have the funds or 2) re-requests documents for a loan modification that my clients have already submitted.

    A loan modification is not your only option in a mortgage foreclosure. I recommend speaking with a local foreclosure attorney about all the options available to you that do not result in the foreclosure of the home.

    This response does not create an attorney-client relationship. Unless you are already a client of the Law Office of Preston H. Oughton, pursuant to an executed fee agreement, you should not use, interpret, or rely on this response as legal advice or opinion. Do not act on any information in this response without seeking legal advice. Preston H. Oughton poughton@oughtonlaw.com (904) 854-6336.

  4. Andre Keith Sanders

    Contributor Level 7

    2

    Lawyers agree

    Answered . Assuming you are in Pasco County, the foreclosure should automatically be referred into the mediation program within approximately 30-60 days of the foreclosure case being initiated. You should get notices from Mediation Managers, Inc. that explains what you need to do in order to participate in the mediation event. The bank does pay the costs up front, but may add all or part of those costs to your mortgage balance.

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