The order would require all lenders filing home mortgage foreclosure lawsuits involving owner-occupied houses to participate in a mediation program to see if they can work out a deal with the borrower, said 19th Circuit Chief Judge William Roby.
The goal of the program is to keep families in their homes, save money for banks and taxpayers and ultimately stabilize the real estate market and the economy, said Roby and others helping to formulate the program. It would be the first program of its kind in Florida.
There is no end in sight to the mortgage foreclosure crisis on the Treasure Coast, Roby said.
There were a total of 1,121 mortgage foreclosure suits filed in January in Martin, St. Lucie and Indian River counties. The 13,856 mortgage foreclosure suits in the three county area in 2008 was more than double the previous record set in 2007.
“This is a critical time in our state’s history and the judiciary must do what we can within the bounds of the law to make a positive impact on both the business community and distressed homeowners,” Roby said.
The Collins Center for Public Policy, which will manage the program, plans to set up a mediation center in St. Lucie County and schedule meetings where lenders and borrowers can try to negotiate a new deal with the help of a court-certified mediator, said Rod Petrey, the nonprofit group’s president.
In cases where the banks and homeowners can’t strike a deal, the foreclosure process would go forward, Petrey and Roby said.
“It holds the promise of helping homeowners, lenders and our local communities stem the raging tide of foreclosures,” Petrey said.
Representatives of several local and national banks said they did not know enough about the proposal to critique it, but expressed general opposition to court intervention. Several local bankers also said they do not have major problems with foreclosures because they did their homework to make sure their borrowers could pay back the loans.
“We obviously are very opposed to any more intervention at this point,” said Dave Skiles, president of First Peoples Bank in Port St. Lucie. “You get the third party in there, it does nothing but run up fees and complicates matter.
“Community banks like ours work with customers. We try to help our people. The last resort is to foreclose. They’d much rather have the money, the income stream. Everybody loses in foreclosure.”
TREASURE COAST MORTGAGE FORECLOSURE TRENDS
January 2009
Martin County: 196
St. Lucie County: 793
Indian River County: 132
Total: 1,121
Treasure Coast
2005: 814
2006: 1,961
2007: 6,791
2008: 13,856
HOW THE 19TH JUDICIAL CIRCUIT’S MEDIATION PROGRAM WOULD WORK
• All lenders filing mortgage foreclosure lawsuits involving owner-occupied homes will be required to pay a $750 mediation fee and provide contact info for a representative with the authority to modify the loan agreement.
• The Collins Center for Public Policy will send the homeowners to consumer credit counselors to help them formulate a financial statement showing assets, liabilities, income and expenses.
• The Collins Center will schedule a meeting with the homeowner, bank and mediator in an effort to strike a new deal that is affordable to the homeowner and acceptable to the lender.
• If a deal is reached, the mediator will document the terms and a judge will dismiss the foreclosure case without prejudice.
• If the lender fails to show up, or lacks the authority to modify a loan agreement, the foreclosure case will be dismissed without prejudice.
• If the borrower fails to show up or fails to provide the financial statement, the foreclosure case will move forward to a summary judgment hearing.
• If no deal is reached, the foreclosure case would go through the regular process.
By George Andreassi, TCPalm.com
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February 21st, 2009 at 10:06 am
how does this effect home equity lines of credit
February 21st, 2009 at 10:08 am
my morgage company when i call for help they take my info and tell me someone will get back to me this has been going on for about 4 months no one ever calls me back what should i do????