Foreclosure Mediation to Potentially Save Your Home
Friday, November, 23, 2012
Imagine the situation—a husband and father of 3 has lost his job due to layoffs in his company and is unable to pay his mortgage payments until he finds a new job. His friend is helping him get a new job at a different company, but it will be several weeks before that pans out. In the meantime, he gets a month behind on his mortgage, and avoids the mortgage company’s phone calls and letters reminding him of his missed payment. He doesn’t have the emotional wherewithal to deal with discussing his situation with someone on the phone and he thinks if he can just hold them off a little longer, he’ll be able to catch up on his payments as soon as the other job becomes available, but for now, his avoidance tactics are hurting him more than helping him. After several months of not hearing from the homeowner, the lender decides to threaten foreclosure on the property.
In today’s troubled economy, more and more homeowners are facing the terrible threat of foreclosure on their home. The worst part is that many of these foreclosures can be avoided with better communication between homeowner and lender. However, in stressful situations, often the last thing a homeowner wants to do is discuss his or her financial problems with a faceless lender on the other end of the phone.
Foreclosure mediation as a form of Alternative Dispute Resolution (ADR) is one way to avoid this scenario happening. In foreclosure mediation, the homeowner is given the opportunity to sit down with a representative from the lending institution and discuss his situation face-to-face. A neutral, third-party mediator, who is well-versed in real estate law, facilitates the discussion and allows both the homeowner and the lender ample opportunity to discuss their “side” of the dispute.
While foreclosure mediation is not a guaranteed halt in the foreclosure process, it gives the homeowner the opportunity to do the most important thing he can be doing right now—communicating honestly with the lender. The process will perhaps buy the homeowner more time to get his finances in order and give the lender more assurance that the homeowner is doing everything possible to save his home from the threat of foreclosure.