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According to an article in the Star-Telegram, some legislators are pushing mandatory mediation to resolve lender/borrower foreclosure disputes. Will it work in Dallas-Fort Worth?
The article examined the case for it in Florida:
“Florida’s courts are currently trying to cope with more than 290,000 foreclosure cases… A majority on the high court’s Task Force on Residential Mortgage Foreclosures recommended trying mediation on owner-occupied homes before cases go to court, with lenders picking up the tab. Borrowers would be contacted by phone and mail and asked to participate. The high court did not immediately act on the proposal.”
But lenders don’t want to pick up the tab to mediate foreclosure disputes. They want at least a 50/50 split of expenses with the borrower.
“Minority members said mediation should be offered only if ordered by a judge, and the costs – an estimated $750 per case – should be split 50-50 between lenders and borrowers.”
There are a few concerns with mandatory mediation in foreclosure disputes. I would be concerned about the cost forced upon the borrower facing foreclosure. Foreclosure is an expensive process for the lender, by using mediation, mortgage lenders would save millions AND shift part of the expense to borrowers if a 50/50 split of costs are required. Also, I’m concerned about the objectivity of the mediators. We’ve already had arbitrator cases where there was an obvious bias against debtors. We cannot allow a repeat of that problem if we require mediation for foreclosure disputes. Maybe mediation managed by judges would work
November 17th, 2009 at 1:05 am
Mediation? blah, blah, i went through mediation at the Collins Center in Miami, I thought, finally maybe something out there actually works. No, not really, my mortgage company or as i don't know what to call it, lender/investor/servicer – which is…US BANK NATIONAL, ASC – SERVICER AND WELLS FARGO lender came to the mediation with a ridiculous high monthly payment, actually close to what i was paying. Negotiation you say? NONE , mediators are there, but can't offer or dispute banks decision, so in other words….there was no negotiation. I want something sustainable long term, they The Bank was setting me up again to default, a waste of time on there end and a waste of time on my end. This applies to the saying.. If it's to good to be true, think again. It's just like the Obama Plan, it helps only fannie and freddie loan mortgages, the rest of us are at the mercy of the INVESTOR'S, because this is what the bank tells you an order to reject your modification. Please stop promising false hope on homeowners, if there is something out there that is going to work, let the public know, otherwise..we've been through enough already. Another thing, we the tax payer are paying what these banks took in TARP money, so why are they giving us a hard time, we are in this ticket also, we are entitled to modify not just a selected few, these banks are cherry picking their customers, only the ones they consider to modify, another way of corruption.