Florida Foreclosure Mediation Program Coming to an End
The Florida foreclosure mediation program is no more, for now. The program lasted just 18 months before chief Justice Canady terminated the program yesterday. Those cases which are currently in the "mediation" program may continue with the program until the case ends. As a foreclosure defense attorney, the move is not real surprising. The program did not meet legislature expectations and is being shut down for ineffectiveness. The legislature and other elected officials will continue to work and devise policies and procedures to help aid the ever growing foreclosure crisis.
In Florida, if your primary residence was being foreclosed on, you were entitled to participate in the mediation program. If the property being foreclosed was not your primary residence, the mediation program was not available. Although this program seemed logical and beneficial on paper, it never worked out the way the policy visionaries had hoped in a practical sense. Modifications and settlements were very rare to come by and the program became expensive as more and more cases were being filed.
Many times, homeowners/defendants would prepare and attend mediation looking to workout a temporary or permanent modification. However, a common practice among the banks (more so the bigger lending institutions) was to show up unprepared or send a representative that had no settlement authority. Both parties, including mediators, expended a large amount of time and effort but to no avail. The homeowner typically left these meetings upset and discouraged while the bank representative received all of the homeowner's financial information. If the homeowner appeared to make too much money or had substantial assets, then the bank most often would deny modifications. Furthermore, this disclosure allowed the banks to determine whether or not they would pursue a deficiency judgment in the event the property sold for less than what was owed.
Therefore, as a Northeast Foreclosure Defense Attorney, I made it a common practice to advise my clients to forgo the formal mediation (unless my client was adamant about going) and continue efforts to workout something through informal mediation. I just felt it was not in the best interests of my client to prepare for these meetings and gain a sense of false hope. Many attorneys will agree with this common practice and many may not. My job is to make the client aware of every nuance of the mediation and give them an opportunity to make an informed decision as to whether or not they wish to attend.
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Greg Gilbert
Keith Maynard
