Mediation proposed as foreclosure fix
Center for American Progress urges feds to fund local programs
By Inman News, Monday, July 20, 2009.The best hope for stemming the tide of foreclosures is for the federal government to back implementation of mandatory mediation programs at the state and local level, a report from the Center for American Progress argues.
More than 80 percent of homeowners at risk of losing their homes hadn't tried to work out alternatives to foreclosure with their loan servicers at the end of last year, authors Andrew Jakabovics and Alon Cohen maintain.
Homeowners fighting foreclosure in court sometimes receive hearings as short as 15 seconds before losing their homes, they say in the report, "It's Time We Talked: Mandatory Mediation in the Foreclosure Process."
Jurisdictions in nine U.S. states are employing alternative dispute resolution methods that include mandatory mediation. Among the best programs, nearly 75 of cases are resolved without resorting to formal foreclosure proceedings, the report said.
The federal government could take a more direct role in providing opportunities for mediation by:
- Funding state and local mandatory mediation programs, as it provides neighborhood stabilization funds to alleviate the housing crisis.
- Issuing guidance permitting community development block grants to be used to fund mandatory mediation programs as an interim measure.
- Requiring mediation for all federally insured mortgages, expanding upon an existing requirement that all FHA servicers engage in loss-mitigation efforts prior to foreclosure.
- Requiring that loan servicers acting on behalf of Fannie Mae and Freddie Mac participate in mediation prior to foreclosure.
- Requiring all loan servicers participating in the Home Affordable Modification Program to participate in mandatory mediation prior to foreclosure in cases where a modification is not possible under program rules.
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Submitted by Ron Taylor on July 20, 2009 - 1:55pm.
We do not need more federally funded programs. We need the Feds to keep out of our lives. Just where is this new "funding money" to come from? Yes, pay more taxes!
Our nation is bankrupt. The official notice has not been declared publicly by the current draconian administration.
Just look at our current deficit and then look at what has been proposed to extend TARP and have socialized medicine. It’s unconscionable.
Most lenders will tell you that the majority of loan modifications end up in default. People that file bankruptcy are just delaying the inevitable. With unemployment hovering at the 10%, more and more homes are being defaulted. We haven’t seen the worst yet to come.
We get calls weekly from home owners that are upside down with their mortgage, viz., owing more that what the home is worth. In order to auction them, we have to work out a short sale with the lenders that takes three to six months to go full cycle.
Then the Obama administration keeps changing the rules further delaying a successful short sale. Government is our problem, not the solution and spending more money is not the solution either. Let the free market work.
The Honduras government shipped out their president on the next plane for violating its sovereign constitution and basically said, “You’re out of here!” Maybe we can learn a few things from them.
Ron Taylor<><
President/Broker/Auctioneer
The Restorer, Inc.
D/B/A Taylor and Sons Real Estate & Auctioneers
252-257-4822 (Office)
252-257-1302 (Fax)
www.canSellnow.com
Submitted by Jillayne Schlicke on July 20, 2009 - 6:53pm.
Over the past 18 months, the federal government has agreed to give local, HUD-approved housing counseling agencies millions and millions of dollars to hire and train housing counselors. States have given the non-profits money on top of the federal funds!
So.....the non-profits want more money.
I'm not surprised or impressed.
Show us what the non-profits have done with the federal money they already received. How many foreclosures were avoided? How many loans were modified due to the DIRECT result of the taxpayer money spent.
Mediation is a higher level process than just counseling which means an even higher expense per homeowner.
Let's slow down and take a look at how the non-profits spent the millions already given to them.