Q & A On Maryland Foreclosure Mediation Program

This is a great Q & A from the Baltimore Sun explaining the foreclosure mediation program in Maryland.

Questions from the article include:

What will change for home owners and lenders?
What steps does the law add?
What comes next?
How will the mediation itself work?
What happens if they don't agree?
What's the cost?
The lender has to pay $300 at the order to docket stage. ... It’s a $50 fee for the homeowner to request mediation. Both of those fees that the lender would pay and the homeowner would pay go into a fund … for the additional administrative law judges that OAH would hire, as well as pay for continuing our counseling network.
Is there any reason for lenders to work something out in mediation?

Read the full Q & A [here].

2 comments:

  1. I really don't know if mediation will be effective in the foreclosure process. I came to mediation straight from the sub-prime mortgage industry, a transition that all took place right here in Maryland. I really don't see lenders having a great incentive to go to mediation. My guess is the their ability or willingness to do loan modifications isn't going to change much by the time they get to mediation.

    Also, I think the intent of the bill, to increase loan modifications, doesn't utilize the mediation process for what is is, to gain understanding from all sides and to collaboratively make decisions.

    If anything, I hope foreclosure mediation puts a human face to both lenders and borrowers. I've met some cold-blooded (and a few really lovely) debt collectors who are more than happy to drop the axe, and feel entitled to do so. It's easy to blame borrowers for getting themselves in financial hot water even though many borrowers are simply plagued by unfortunate life circumstances and are not necessarily irresponsible. On the flip side, lenders can be demonized and viewed as part of a failed system, when in fact, even big mortgage lenders are run by well intentioned individuals (some of whom also own homes) who are simply working for a living and following organizational policy when they help facilitate the foreclosure process.

    Only time will tell, but right now, my fingers are tightly crossed.

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  2. Great comment. You mention:
    "Also, I think the intent of the bill, to increase loan modifications, doesn't utilize the mediation process for what is is, to gain understanding from all sides and to collaboratively make decisions."

    I think an important question is- does one side even care to understand? I think the perspective by the banks might still be a from a narrower perspective of not trying to "get what's best GIVEN THE SITUATION."

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