Mediation Not Working As Foreclosure Sheriff Sales Continue to Ri

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Mediation Not Working As Foreclosure Sheriff Sales Continue to Ri

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The number of foreclosed properties being offered at Sheriff sales in Florida continues to rise despite the mediation program that has been put in place in March of last year to get lenders and borrowers to negotiate for foreclosure alternatives. The program was also reportedly implemented to cut down the backlog of foreclosure cases in the state.

According to housing market analysts, the mediation effort has not been able to cut down the number of foreclosure homes in Fort Lauderdale, in Miami and in other key markets of the state mainly because it is merely a voluntary program. This means that both lenders and borrowers are not required by law to enter mediation so anyone can ignore it and no solution for troubled homeowners are developed that can replace foreclosure.

The program was supposedly put in place last year to help owners of foreclosure homes in Florida and to also cut down the state's backlog of foreclosure cases which, at the start of 2010, was around 462,000. Local analysts reported that the program was able to reduce the backlog of cases by at least a third, but it failed to meet its original purpose; that of helping state homeowners avoid foreclosure.

Data presented by the Office of the State Courts Administrator revealed that almost 58,000 cases were referred to the program within the six months following its March 2010 inception. These cases include delinquent borrowers, properties listed for sheriff sales and other foreclosure-related cases. However, out of this total, only 2,162 cases as of May 1, 2011 have produced an agreement between borrower and lender which translates to around 4% of all pending cases.

Those markets where one can find foreclosed homes owners to have benefitted from the program by a larger number were under the jurisdiction of the 12th Judicial Circuit. These areas include DeSoto, Manatee and Sarasota counties which had a combined success rate of around 4.2%. Out of the 1,691 cases in these areas, 71 were reportedly able to secure a settlement. Most court officials expressed their dissatisfaction over the failure of the program to meet its original targets.

According to them, a big number of homeowners who are in danger of losing their properties to foreclosure sheriff sales do not bother to show up; with majority of them not even aware that such a program exists. Administrators have reported that in 60% of the cases, they were unable to get in touch with the borrower to let them know about the mediation initiative.