Posted on Thursday, April 23, 2009
The Florida Supreme Court has announced a statewide task force to look into uniform mandatory mediation statewide. Ohio has been doing this for about a year and New Jersey, Nevada, Minnesota, Connecticut and other states are looking into it. Last month they received an emergency petition asking them to consider mediations before a final judgment is given and a sale date set.
The primary drive is a huge back log of court cases. The other is a patchwork of ad hoc rules arising in various areas throughout Florida. The wide differences, among other tings, is making is very difficult and expensive for national lenders to comply. Some districts require lenders to provide borrowers with contact numbers fo non-profits that can help them. Other require lenders reps to be physically present at hearings as opposed to attending by telephone.
Some hope this will save homes and shorten the foreclosure process and backlog helping all of us since homes in foreclosure longer often mean vacant homes in our neighborhoods and condos longer. Statewide foreclosures are taking and average of 300 days, twice previous time frames.
Miami Dade appointed a 15 member task force to explore the idea as well. Over 75% of the cases in that area are foreclosure related. 600 new cases a month. And one in five mortgages is past due meaning more foreclosure down the road. The program called CHAMP for Circuit Homestead Access to Mediation Program will start May 1 as a way to experiment and find any problems before launching a state wide program. It requires lenders to notify the Collins Center for Public Policy within five days fo filing foreclosure. The center will notify the homeowner that mediation is available as well as financial counseling and then arrange the mediation. It iis estimated to take 120 and will cost lenders $750 per file. Not complying may result in having the case thrown out of court. Only homestead properties qualify. Attending credit counseling is a small “price to pay” for the homeowner. There were over 56,000 such cases last year. The Center fo Responsible Living estimates 131,400 Florida homes can be saved.
The point is to allow lenders and borrower a real opportunity to communicate and try to work out the problem, something both sides say is not happening and blame on each other.
Some says the $75 billion bail out last month is helping get mediation off the ground by providing work out options for homeowners that they may not have had before. Others feel mandatory mediation will only slow down the foreclosure process even more and add further costs which would eventually be passed on to homeowners.
For more information about mediation, click on the “mediation” tab at www.foreclosurenationthebook.com,