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Prevent Foreclosures: Consider Foreclosure Mediation

Alternative forms of resolution, such as mediation and arbitration, have their place within the legal world. Everyone from big companies, to professional athletes, to families going through divorce utilize them. And that has raised the question of whether mediation and arbitration have a place in the real estate industry, too.

One of the parties driving the foreclosure mediation debate is the United States Department of Justice. In writing about their Access to Justice program, the DOJ describes what it means when it refers to foreclosure mediation:

In response to the ongoing foreclosure crisis, many jurisdictions around the country are turning to mediation, where a neutral third-party (often, but not necessarily employed by a court) helps facilitate negotiations between a lender and homeowner as they attempt to reach agreement on an alternative to foreclosure where such an outcome is feasible.

Access to Justice sorted through at least 40 different foreclosure mediation programs around the country and tried to determine what best practices should be cultivated. Such programs have the additional benefit of being friendly towards middle-class and lower-income families.

To become more popular, foreclosure mediation would have to overcome the scrutiny of people like Raphael Bostic and the Department of Housing and Urban Development: "If foreclosure mediation is such a good idea, why haven't more jurisdictions taken up the mantle? What are barriers to implementation and program participation, and is the conventional wisdom that mediation takes a long time and is costly supported by the evidence?"

It is partly to answer these inquiries that a full report was issued, writes the DOJ.

It appears taht foreclosure and mortgage mediation would be a positive advance on the current alternatives to foreclosure that are out there. These include special forbearances, mortgage modifications, partial claims, pre-foreclosure sales, and deed-in-lieu of foreclosures. For more information on these alternative to foreclosures, as well as whether foreclosure mediation is available in your area, please see below.

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