Q: What is foreclosure mediation?
A: Mediation is a process of guided negotiations. A neutral individual, (“mediator”) works with the parties to a mortgage, with or without attorneys, to resolve the mortgage problem by mutual agreement before it reaches court, default judgment, or foreclosure sale. The mediator (even a mediator who is also an attorney) cannot give legal or financial advice to either side and has no authority to decide the case.

Q: Why should I mediate my mortgage problem?
A: Mediation allows you to make decisions on what solution is best for you.  Many mortgage problems, whether caused by a sudden change in the terms of the mortgage, like a rate adjustment, or a change in your financial situation, can be resolved through good communication.  An experienced mediator can help you create solutions.  Right now, lenders are generally willing to discuss reasonable solutions, and mediation provides a more controlled, diplomatic environment in which to have discussions that, without a mediator, might be tense or difficult.
 
Q: How does using foreclosure mediation differ from using a “debt relief” service?
A: While some mediators volunteer their time and others charge limited fees for hours actually worked, there are no hidden or ongoing fees or costs associated with mediation and, in most cases, it only takes a few hours of time.  “Debt relief” services, however, may charge excessive fees for modest results, and some are actual scams. 

Q: What is pre-suit mediation?
A: Pre-suit mediation is a conference that is held before a lawsuit is filed. Once a suit is filed, it becomes a public record and anyone can get information about the parties. Credit reporting services monitor court records and note the filing of a foreclosure as a black mark on a person’s credit rating. Pre-suit mediation avoids a public record, saves expenses, and solves a problem (like non-payment) before it becomes worse. 
 
Q: Will the mediator make a recommendation to the court about my case ?
A: No. A mediator makes no decision or recommendation to the court.  In fact, the mediator can only tell the court (if a case is already pending) whether or not the case settled. Mediation discussions in Ohio cannot be used at trial.

Q: Should I bring witnesses and exhibits to the mediation?
A: No. A mediation is not a trial. There are no witnesses, no exhibits, no objections, no cross examination, and no arguments. You may, however, bring documents related to your mortgage and financial circumstances.
 
Q: Will I testify?
A: No. In mediation, everyone sits at the table as equals in a discussion. You are there to listen, participate, negotiate, and decide whether or not to settle.

Q: Can the mediator help me with my case?
A: No. The mediator may objectively identify certain problems for each side, and discuss the drawbacks of foreclosure versus the benefits of settlement. The mediator is not there as a judge, jury, or arbitrator of the case, nor as an advocate or advisor for either side. You must evaluate your finances and the benefits of possible new mortgage terms.
 
Q: Will the other side be there?
A: Generally, yes. A lender representative with authority to settle and the current property owner(s) should be present and prepared to negotiate. The mediator usually will meet separately with each side for private, more candid discussions.

Q: Can I bring my attorney?
A: Yes. Under Ohio law, a party can bring an attorney or another support person to the mediation. 

Q: What if I just want to give up the house and walk away?
A: If, after careful consideration, you decide to give up your house, you can return your mortgaged property to the lender through “a deed in lieu of foreclosure.” You can still mediate such issues as the date of turn over, when to move out, and any other obligations you may have.

Q: I want a trial. Why should I settle?
A: Citizens have the right to a fair court hearing, but foreclosure cases hardly ever, go to trial. The judge usually decides foreclosures based on motions the lender files with the court. Each side should thoroughly discuss every factor before choosing to settle with new terms or go forward with foreclosure. Mediation allows you to explore settlement without risk, and with a trained mediator’s help.

Q: What happens if we can’t settle?
A: Everyone may agree to negotiate further, the mediator can schedule a follow-up mediation, or the case could ultimately go forward in court. There is no penalty or extra cost for using mediation.

Q: What are Ohio courts doing about foreclosure mediation?
A: The Ohio Supreme Court, under the leadership of Chief Justice Thomas Moyer, has created a model program to help local courts start their own foreclosure mediation programs. Information about this model is available on the Web at: http://www.supremecourt.ohio.gov/ (type "dispute resolution - foreclosure" in search box) . To see if the common pleas court in your county has adopted such a program, please contact the court administrator, the local bar association, or the clerk of courts. Please remember that asking for mediation of a foreclosure case pending against you does not automatically prevent a default judgment. You should contact an attorney to make sure you file an answer to the foreclosure complaint.       

2/20/2009

Law You Can Use is a weekly consumer legal information column provided by the Ohio State Bar Association.  This article was prepared by Harold Paddock, Columbus mediator and arbitrator.