Can Foreclosure Mediation Help Me Save My Home?

Q: What is foreclosure mediation?
A: Foreclosure mediation is a process of guided negotiations wherein a mediator works with the homeowner and the mortgage lender in order to resolve the mortgage problem. This is usually done by mutual agreement before the case reaches court, default judgment, or foreclosure sale. The mediator (even a mediator who is also an attorney) may not give legal or financial advice to either side and has no authority to decide the case. The mediator helps the parties to “hammer out” a mutually acceptable agreement.

Q: What is pre-suit mediation?
A: Pre-suit mediation is a conference that is held before a lawsuit is filed. Once a suit is filed, it becomes a public record and anyone can get information about the parties. Credit reporting services monitor court records and note the filing of a foreclosure as a black mark on a person’s credit rating. Pre-suit mediation avoids a public record, saves expenses, and solves a problem (like non-payment) before it becomes worse.

Q: Why should I mediate my mortgage problem?
A: Mediation allows you to make decisions on what solution is best for you. Many mortgage problems, whether caused by a sudden change in the terms of the mortgage, like a rate adjustment, or a change in your financial situation, can be resolved through good communication. An experienced mediator can help you create solutions. Right now, lenders are generally willing to discuss reasonable solutions, and mediation provides a more controlled, diplomatic environment in which to have discussions that, without a mediator, might be tense or difficult.

Q: Will the mediator make a recommendation to the court about my case ?
A: No. A mediator makes no decision or recommendation to the court. In fact, the mediator can only tell the court (if a case is already pending) whether or not the case settled. Mediation discussions in Florida cannot be used at trial.

Q: How does using foreclosure mediation differ from using a “debt relief” service?
A: While some mediators volunteer their time and others charge limited fees for hours actually worked, there are no hidden or ongoing fees or costs associated with mediation and, in most cases, it only takes a few hours of time. “Debt relief” services, however, may charge excessive fees for modest results, and some are actual scams.

Q: Who will be at the mediation conference?
A: Generally a lender representative with authority to settle and the current property owner(s) should be present and prepared to negotiate. The mediator usually will meet separately with each side for private, more candid discussions.

Q: May I bring my attorney?
A: Yes. Under Florida law, a party may bring an attorney or another support person to the mediation.

Q: What if I just want to give up the house and walk away?
A: If, after careful consideration, you decide to give up your house, you can return your mortgaged property to the lender through “a deed in lieu of foreclosure.” You can still mediate such issues as the date of turn over, when to move out, and any other obligations you may have.

Q: I want a trial. Why should I settle?
A: Citizens have the right to a fair court hearing, but foreclosure cases hardly ever, go to trial. The judge usually decides foreclosures based on motions the lender files with the court. Each side should thoroughly discuss every factor before choosing to settle with new terms or go forward with foreclosure. Mediation allows you to explore settlement without risk, and with a trained mediator’s help.

Q: What happens if we can’t settle?
A: Everyone may agree to negotiate further, the mediator can schedule a follow-up mediation, or the case could ultimately go forward in court.