Update on Home Foreclosure Mediation
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January 2012 |
- Federal legislation was introduced by Congresswoman Frederica Wilson (D-FL) on December 8 which would provide for mediation between borrowers and lenders prior to foreclosure. H.R. 3595, the Mandatory Foreclosure Mediation Act, was referred to the Committee on Financial Services. South Florida Caribbean News (December 8, 2011); H.R. 3595
The Florida Supreme Court terminated its statewide mandatory foreclosure mediation program due to lack of success. Only 4% of cases eligible for mediation concluded with a settlement. Borrowers often were not contacted; when they were, mediation settlements increased to 27%. In ending the statewide program, the Court noted that the state’s Circuit Courts have the responsibility to manage residential foreclosure cases and may refer cases to mediation. In re Managed Mediation Program for Residential Mortgage Foreclosure Cases, No. AOSC11-44 (Fla., December 19, 2011); Miami Herald.com (December 21, 2011); JDSupra (December 22, 2011)
- A new Florida mediation program may help homeowners going through Chapter 13 bankruptcy obtain mortgage modifications to prevent foreclosure of their homes. Thus far, 90% of homeowners who have entered the Bankruptcy Mortgage Modification Mediation Program have obtained mortgage modifications. The program was launched in Orlando, is expanding into Manatee and Sarasota counties and could be statewide by the end of 2012. Digital Journal (December 16, 2011)
- The Nevada Supreme Court concluded that even though a lender had failed twice to mediate as required, it did not lose its security interest and could bring another foreclosure action. The Court rejected the homeowners’ assertions of issue and claim preclusion and affirmed the lower court’s order that the matter be sent to mediation as part of the subsequent foreclosure process. Holt v. Regional Trustee Services Corp., 127 Nev. Adv. Op. No. 80 (Nev., December 15, 2011)
- The Nevada foreclosure mediation program, run by the Nevada Supreme Court, has conducted over 12,000 homeowner mediations, of which some 11,000 did not result in foreclosures, and in about 3,700 the homeowners were allowed to remain in their homes, according to the program. A California nonprofit group is seeking to verify those claims of success, but has been told it would cost them $940,000 to review the records. The state asserts that it would cost that much to redact the 600,000 requested documents in order to preserve mediation confidentiality. Las Vegas Sun (November 19, 2011)
- Las Vegas, Nevada has launched an advertising campaign to increase awareness of free assistance by approved counselors relating to foreclosure mediation and related topics. The three-month campaign is funded by a grant from Fannie Mae and HUD. FOX5 Las Vegas (November 9, 2011)
- Hawaii’s May 2011 legislation requiring mediation of non-judicial foreclosures continues to significantly constrain the number of foreclosures in the state, with only one-third the number of foreclosure filings compared to a year earlier. The necessary mediation process for non-judicial foreclosures was not available until October 3, but lenders have not used the non-judicial process during the first month and say it will not be used because of punitive penalties for even minor infractions. A legislative push to make the law more palatable to lenders – while still protecting homeowners – is likely in 2012. Honolulu Star-Advertiser (November 10, 2011)
- Recent legislation in Delaware created a Foreclosure Prevention Office that assists homeowners facing foreclosure with mediation and other issues. Delaware’s mandatory foreclosure mediation program begins in January. WGMD.com (November 17, 2011)
- Although two bills addressing foreclosure died in the Oregon legislature when the 2011 session ended on June 30, Oregon legislators intend to renew the effort, which may include pre-foreclosure mediation, in the new session beginning in February. Statesman Journal.com (November 26, 2011)
Biography
Keith L. Seat is a full-time mediator and arbitrator who can effectively assist parties in resolving a wide range of telecommunications, antitrust and other commercial disputes. With over twenty years of legal experience as a mediator, arbitrator, litigator, advocate before executive branch agencies, and key staffer in the legislative and judicial branches, Mr. Seat brings a wealth of experience to his work as a mediator and arbitrator to help parties reach successful resolutions of complex disputes.
Mr. Seat began his legal career in a federal clerkship with U.S. District Judge William H. Becker, and then litigated antitrust and commercial disputes for many years at a major Washington law firm, Howrey, Simon, Arnold & White, where he first worked on telecom and technology issues. In 1993, Mr. Seat was named General Counsel of the Antitrust, Business Rights and Competition Subcommittee of the U.S. Senate Judiciary Committee, where he served for four years, playing a significant role in the enactment of the Telecommunications Act of 1996. Returning to the private sector in 1997, Mr. Seat rounded out his experience with a senior in-house counsel position at MCI, one of the nation’s largest telecommunications firms. At MCI, he gained a first-hand appreciation for the important perspective brought to issues and disputes by in-house decision-makers. Mr. Seat also deepened his knowledge of telecom issues and gained experience addressing competition-related issues in the corporate setting, as well as helping resolve disputes among large organizations.
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