WHAT IS THE FORECLOSURE MEDIATION PROGRAM?
This program allows homeowners to sit down with mortgage lenders, under the leadership of trained mediators, to discuss alternatives to foreclosure. Mediation is a process of give and take and the parties must negotiate in good faith. A mediator does not have the authority to order a resolution or an action, as a judge in a court case would, but may be able to help the parties reach a mutually beneficial agreement.
WHO MAY PARTICIPATE IN THE FORECLOSURE MEDIATION PROGRAM?
Under Nevada law, the program is open to homeowners of owner-occupied houses who receive foreclosure notices (formally titled Notice of Default and Election to Sell) that were filed after July 1, 2009. Persons who received foreclosure notices filed before that date can join the mediation program only if their lenders agree.
WHO MAY NOT PARTICIPATE IN THE PROGRAM?
Those not eligible for the program include:
Homeowners who do not occupy the homes being foreclosed
Those who have already surrendered their homes to the lenders
Homeowners who have begun bankruptcy proceedings
WHO INITIATES THE MEDIATION PROCESS?
Assembly Bill 149 gives a borrower the right to seek mediation of a mortgage loan if they are the owner and occupant of that home. The borrower has 30 days after being served with a foreclosure notice to elect to participate in mediation and notify the trustee (generally an employee of a title company or the current lender), who shall, in turn, notify all entities with an interest in the property.
HOW DOES SOMEONE REQUEST FORECLOSURE MEDIATION?
WHAT IF A MORTGAGE COMPANY OR LENDER DOES NOT WANT TO PARTICIPATE IN MEDIATION?
Once a homeowner requests mediation, the lender is required to participate.
WHAT IF A HOMEOWNER FAILS TO REQUEST MEDIATION WITHIN THE ALLOTED TIME?
Failing to request mediation within 30 days of receiving a foreclosure notice may be considered a waiver of that option and the lender can proceed with the foreclosure.
WHAT IF A HOMEOWNER OR A LENDER FAILS TO APPEAR FOR THE MEDIATION?
If the homeowner fails to appear, it may result in the forfeiture of the right to mediate. In that instance, the lender is notified that the foreclosure can proceed.
Under the rules, if a homeowner fails to attend the mediation, the Program Administrator will issue a certificate stating that no mediation is required. In that instance, a foreclosure may go forward.
If a lender representative does not participate, the mediation will be concluded and the Mediator will issue a formal Statement to both parties.
Either party may file a petition for judicial review in the appropriate District Court seeking a determination of bad faith participation and sanctions.
WHAT IF A PARTY CANNOT ATTEND AT THE DESIGNATED TIME?
Mediations may be postponed only if a participant cannot attend because of “extraordinary circumstances.” On a written request of a party, a mediation may be rescheduled within 10 days if the mediator agrees.
HOW LONG WILL IT TAKE FOR MEDIATION TO BEGIN?
Under the proposed Supreme Court rules, mediations must begin within 90 days of the recording of the notice of default. Mediations are expected to be calendared within 80 days of the recording of the notice of default to allow for a possible delay because of an emergency. The first mediations are expected to be scheduled in August 2009.
WHAT IS THE COST OF MEDIATION FOR THE PARTIES?
The mediation fee is $400, to be shared equally by the homeowner and lender. Each party must pay their $200 fee prior to the mediation. When submitting the forms requesting mediation, the homeowners must include their payments of $200 in cashier check, money order, or, when available, by electronic transfer.
WHERE WILL THE MEDIATIONS TAKE PLACE?
The mediator assigned to a case will designate the location and time for the mediation after consulting with the parties.
WHO WILL CONDUCT THE MEDIATIONS?
Mediations will be conducted by Senior Judges, Supreme Court Settlement Judges, hearing masters, or other qualified and trained individuals. Hundreds of Nevada attorneys have volunteered to be mediators and those selected will undergo training to ensure consistency and effectiveness. The pool of mediators may also include non-attorneys with mediation experience. Within 10 days of a case entering the Foreclosure Mediation Program, a mediator will be assigned.
WILL THE MEDIATOR BE ABLE TO GIVE LEGAL ADVICE?
A mediator cannot give legal advice. It is the job of a mediator to be impartial. It is not required in mediations that you have an attorney, but if you need legal advice you may consult your own attorney before or during mediations. If you cannot afford an attorney, a list of legal aid providers in Nevada can be accessed by using the “Self Help” link on the Supreme Court website (CLICK HERE).
CAN I PICK MY MEDIATOR?
Mediators are randomly assigned from a list of qualified and trained individuals chosen to serve in the program. In the event an assigned mediator has a conflict, another mediator will be randomly assigned once the Foreclosure Mediation Program Administrator is notified.
HOW DOES A PERSON BECOME A MEDIATOR?
An application is available on the Supreme Court website (CLICK HERE) for those interested in becoming mediators in the Foreclosure Mediation Program. An applicant must be a Nevada attorney or have experience as a mediator. Those determined to be best qualified will be appointed after the applications have been reviewed and background investigations have been conducted. All mediators will receive training before being assigned. Senior Judges and some Supreme Court Settlement Judges already have received mediation training and are available for assignment.
WHAT IF A PARTY DOES NOT SPEAK ENGLISH AND NEEDS AN INTERPRETER?
If an interpreter is needed by a party, that party is responsible for securing and paying for the interpreter. A list of Certified Court Interpreters qualified to interpret in mediations is available on the Supreme Court website (CLICK HERE)..
It is not required that a certified interpreter be used. Parties may bring any person they wish to interpret the proceedings.
THE PARTIES IN MEDIATIONS ARE REQUIRED TO ACT IN “GOOD FAITH.” WHAT DOES THAT MEAN?
The parties are required to honestly work toward a resolution in a fair and reasonable fashion. This does not mean the parties must reach an agreement, only that they must attempt to achieve a solution that both sides can accept. One example of not acting in good faith may be if either party fails to provide necessary documentation.
IF A PARTY DOES NOT ACT IN “GOOD FAITH,” WHAT COULD HAPPEN?
Not acting in good faith is a serious matter. A party not acting in good faith may be sanctioned by a judge under Nevada law.
WHAT IS A LOAN MODIFICATION?
A loan modification is a change in the terms of the mortgage loan. A loan modification can result in a lender adding missed payments to the loan balance, changing the interest rate, extending the term of a loan, or reducing the total amount due on the loan.