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<xTITLE>What Happens to Temporary Loan Modifications Reached in Foreclosure Mediation?</xTITLE>

What Happens to Temporary Loan Modifications Reached in Foreclosure Mediation?

by Jennifer Shack
February 2015

Just Court ADR by Susan M. Yates,Jennifer Shack, Heather Scheiwe Kulp, and Jessica Glowinski.

Jennifer Shack

A lot of the cases that go through RSI’s foreclosure mediation programs end with a temporary loan modification – a trial payment plan in which the homeowner pays a new mortgage amount for a few months. If the homeowner makes the payments on time and in full during the trial period, the homeowner and bank agree to make the modification permanent. This means that a temporary loan modification doesn’t necessarily mean that the homeowner has averted foreclosure. Because of this, I was interested to find out if homeowners in our programs were able to convert their temporary loan modification into a permanent one. Now that a significant number of temporary payment periods have come to an end, I have finally been able to delve into that question.

Unfortunately, cases are closed out from our programs once the homeowner and lender agree to a temporary loan modification. This means that we don’t know what happens with all those cases that leave the program with a trial payment plan. The data we do have comes from housing counselors who continue to follow up with the homeowners to be sure they make their loan payments and to help with the conversion to a permanent loan modification. This data points to successful conversions. In the 16th Circuit (Kane County, which has the most complete data of our three programs, 24 of 26 temporary loan modifications for which we have data have become permanent. In the 19th Circuit (Lake County), 8 of 11 have. There is no data for the 17th Circuit (Winnebago and Boone counties).

If you’re interested in the statistics from the Illinois Attorney General-funded foreclosure mediation programs, the latest report is now available.


Jennifer Shack joined Resolution Systems Institute (RSI) in 1999 and became Director of Research a year later. In this role, she heads up the Monitoring and Evaluation program at RSI, and is the creator of the Court Mediation Effectiveness Tracking System, in use in circuits around Illinois. She also conducts evaluations of mediation programs in state and federal courts in Illinois. 

In another aspect of her position, Ms. Shack is responsible for the growth and evolution of the Court ADR Resource Center, which contains thousands of resources pertaining to the use of ADR in the courts. Most significantly, she led transition of the Resource Center to a new, sophisticated web site,

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