In an effort to bridge the gap in loan modification services, Florida began a foreclosure mediation program back in 2009. As one of the hardest hit areas for foreclosures, Florida’s officials were hoping the program would result in more successful loan modification efforts. However, data suggests the program has negligible effect on the success of homeowners ability to secure a modification and the program is now being terminated.
Slipping Through The Cracks
It seems like, yet again, more homeowners are falling through the cracks of the system. With so many homeowners failing to pursue foreclosure alternatives or unable to negotiate a loan modification with their lender, the foreclosure crisis continues. The foreclosure mediation program was created with the intent to resolve some of these issues by requiring lenders to participate in mediation before initiating foreclosure, but has failed to live up to its expectations.
Reports showed that only 4 percent of cases eligible for mediation actually resulted in a settlement. Further, many borrowers were simply not contacted about their right to a mediation hearing, leaving them without the chance to participate. After news broke of such disappointing numbers, Supreme Court Chief Justice Charles Canady has signed a letter terminating the program.