1. Why Foreclosure Mediation?

Mortgage lenders do not generally want to own houses (especially in the current environment). Lenders are willing to talk with homeowner-borrowers about reasonable, practical solutions to bring about mortgage delinquency resolutions.

2. How Does Foreclosure Mediation Work?

Upon receipt of this Request for Foreclosure Mediation and Financial Worksheet by the Office of Foreclosure, the material will be distributed to court staff in the local courthouse and to the lender’s attorney. Local court staff will assign a mediator to your case and set a date for the mediation when the lender and homeowner-borrower must appear.

3. What Happens at a Foreclosure Mediation Session?

At the mediation session, you will meet with the mediator, the lender’s attorney and a representative of the lender (this person may appear by phone). The mediator will explain his or her role and will organize discussions about what arrangements you and the lender can agree upon that will allow you to keep your home. Commonly, mediators hold private caucuses with each party to (1) focuses each party on the crucial factors necessary for a successful resolution and (2) help each party analyze the strengths and weaknesses of their positions. If the mediation is successful, a foreclosure mediation settlement memorandum will be prepared by the mediator and signed by all parties.

4. What Are Some Possible Outcomes?

There are a number of possible solutions that you and the lender can explore. The solution will depend upon what you can afford (based on what your income and expenses are), what other resources you have, what type of loan you have, the amount you owe in arrearage and other factors that will be discussed during the mediation. Each lender has a slightly different loss mitigation program. However, every lender will require that you exhibit a reasonable ability to repay the modified monthly mortgage loan payment.

5. What Happens If a Settlement Is Not Reached?

If mediation is unsuccessful, the foreclosure action will continue, ultimately leading to a sheriff’s sale.