Report Suggests Federal Role In Supporting Foreclosure Mediation

Posted by Orb Staff on June 23, 2009 No Comments
Categories : Mortgage Servicing

report from the Center for American Progress suggests foreclosure mediation programs have a place in the federal government's Making Home Affordable program. Mediation programs, in which a servicer's counsel negotiates in-person with a homeowner in the presence of a neutral third-party, have gained traction of late, with Nevada being the most recent state to jump on the bandwagon. New York Gov. David Paterson has proposed expanding his state's mediation requirement to include all borrowers (legislation passed in 2008 requires only subprime borrowers to receive mediation), and the U.S. Conference of Mayors has called on state legislatures to pass mediation laws. Coauthored by Andrew Jakabovics, associate director for housing and economics at the Center for American Progress, and attorney Alon Cohen, [link=http://www.americanprogress.org/issues/2009/06/time_we_talked.html]"[link=hyperlink url]It's Time We Talked[/link]"[/link] proposes that Congress fund state and local mandatory mediation programs. The authors also argue that the government should require all servicers participating in the Home Affordable Modification Program to take part in mediation prior to foreclosure in cases where a modification is not possible under program rules. The report, which reviews successful mediation programs in Philadelphia and Connecticut, additionally recommends the U.S. Department of Housing & Urban Development issue guidance that explicitly permits community development block grants to be used to fund mandatory mediation programs. SOURCE: Center for American P

Register here to receive our Latest Headlines email newsletter




Leave a Comment