By: Gerald A. McGill, Attorney
If you are the owner of an owner-occupied, residential property and are the subject of a mortgage foreclosure action in the First Judicial Circuit of Florida, your case will be initially referred to the Court Authorized Foreclosure Managed Mediation Program. The First Judicial Circuit takes in the counties of Escambia, Santa Rosa, Okaloosa, and Walton. The property must be located in the State of Florida, and must be the homeowner's primary residence. The homeowner will meet with the mediator and the lender's attorney and lender's representative to try to reach an agreement which would avoid foreclosure.
What is mediation?
Mediation is a process by which a neutral third party mediator assists the homeowner and lender in trying to reach a fair voluntary negotiated agreement.
Who are the mediators?
The foreclosure mediators are Florida Supreme Court civil certified and are trained in mediation and foreclosure law. The mediators have knowledge of different community-based resources and mortgage assistance programs.
How do I apply for foreclosure mediation?
If your home is in the First Judicial Circuit and is owner-occupied and you have received notice by the Court that a foreclosure has been filed, you are eligible and you will receive a call from the Collins Center to schedule your mediation appointment. The Collins Center is a not-for-profit organization which is managing the mediations for the First Judicial Circuit. For more information, go to www.collinscenter.org or if you have questions that are not covered in this particular posting, you can ask them at questions@collinsmediation.org.
Do I need a lawyer to participate in the Foreclosure Managed Mediation Program?
No, you do not have to be represented by an attorney to participate in the program. If you do wish to have your own attorney present, it will be at your expense. If you have retained an attorney, please provide the Collins Center Customer Service Staff with the attorney's contact information. To prevent a scheduling conflict, please do not schedule your mediation without first consulting your attorney. Once your mediation date is set, the Collins Center cannot reschedule, so please confirm the date with your attorney before you schedule.
Is there a fee to participate in the Foreclosure Managed Mediation Program?
No, there is no fee to the borrower.
Do all borrowers who signed the mortgage need to attend the mediation session?
Yes, all borrowers must be present at the mediation session; for example if a husband and wife signed the mortgage then both will be need to be present for the mediation.
Where will the mediation session be held?
The mediations for the First Judicial Circuit will be held at the Collins Center Mediation Office located at 236 West Garden Street, Pensacola, Florida. This is the only place where the managed mediations are being held at the current time.
What do I bring to the mediation session?
*Completed Financial Disclosure Form
*Credit Report
*Previous Year's Tax Return
*Proof of Income
*Most Recent Bank Statement
*Current Utility Bill(s) for Property in Foreclosure
*Hardship Letter
Will the mediator issue a decision in my case?
No. The mediator, as a neutral party, makes no decision, judgment or recommendation on the outcome of the mortgage dispute. The mediator's task is to help the parties and attorneys look at the dispute more objectively, discuss various options for a workout of the mortgage, listen to each side privately if desired, and assist the participants in finding a mutually acceptable solution.
Is the mediation confidential?
Yes, any discussions in the mediation session and any information exchanged are confidential.
What happens if we cannot settle?
If the parties cannot settle at the mediation, several things might happen. The parties may agree to further negotiations, or to provide additional information or the case may go forward in court.
Why should I bother to mediate my mortgage problem?
Many difficulties with mortgages, particularly with the temporary inability to pay the full amount of the mortgage can be resolved through reasonable discussions between the homeowner and the lender. An experienced mediator can help the parties find a creative solution that they may have overlooked. Mediation, with the chance to talk privately with the mediator, has a better opportunity to reach a solution than a possibly tense or difficult one-on-one negotiation between homeowner and lender's representatives.
What happens if I recognize that there is no way that I can make even reduced payments and keep my home?
If this is the case, you should still come to the Foreclosure Managed Mediation. There are alternatives to going through a full-blown foreclosure. Some of these are: a short sale where the bank allows the homeowner to stay in the home for at least 90 days while attempting to sell the property. If the homeowner does receive an offer, even if it is substantially lower than the principal of the mortgage, the lender will generally accept a reasonable offer. In addition, there is also an option of a "deed in lieu of foreclosure" in which the homeowner deeds the property back to the lender. This must be done with caution because, in Florida, if the property when resold is for less than the amount of the mortgage, the lender could seek a deficiency judgment against the former homeowner. Obviously the best solution for the homeowner is to have a guarantee by the lender that they will not seek a deficiency judgment.
Why not just walk away from the home and the mortgage?
This is not a good solution in Florida because the lender will proceed with the foreclosure and has the option of pursuing a deficiency judgment against the former homeowner. In some western states in which the lender cannot pursue a deficiency judgment, homeowners are walking away from mortgages that they feel that they cannot pay, but they can do this just by forfeiting the equity that they had in their home, if any, and not have to worry about a deficiency judgment against them in the future.
