Justice Department Issues Report in Support of Foreclosure Mediation

The U.S. Department of Justice released a 69-page report Tuesday on a foreclosure intervention method that is becoming increasingly popular across the country – mediation.


The paper, titled Foreclosure Mediation: Emerging Research and Evaluation Practices, draws from a March 7, 2011 workshop put on by the Justice Department’s Access to Justice Initiative, a panel established in 2010 which works to ensure the U.S. justice system remains accessible and fair to all, irrespective of wealth and status.

The workshop was attended by dozens of foreclosure mediation program stakeholders and researchers. Tuesday’s report summarizes the workshop proceedings and shares recent research and resources for foreclosure mediation.

“The loss of a home to foreclosure can be devastating to a family,” said Mark Childress, who heads the Access to Justice Initiative as senior counselor.

“The report released today compiles the best available research on foreclosure mediation programs and serves as an important resource for existing programs around the
country as well as for jurisdictions attempting to establish foreclosure mediation programs,” Childress said. “Well-structured foreclosure mediation programs may offer the millions of families at risk of foreclosure a way to stay in their homes.”

Foreclosure mediation programs are viewed by policymakers and consumer advocates as a means to bring borrowers and their lenders together to work out an alternative to foreclosure. But some industry participants contend that mandated mediation programs only delay the inevitable.

Florida’s Supreme Court terminated its state-wide mediation program last month, citing the program’s lack of success in resolving foreclosure disputes between lenders and borrowers. The court-run mediation program had been operational for two years, but the Supreme Court said after reviewing the files, it “determined it cannot justify continuation of the program.”

As the Justice Department suggests, there has not been a lot of research or analysis conducted to assess the effectiveness of foreclosure mediation. Officials say the department’s March 2011 workshop was designed to define best practices for evaluating foreclosure mediation programs and to strengthen relationships among program administrators, the lending community, and government agencies.

One of the key findings that emerged from the workshop is that the “federal government should take an active role, both in helping to develop program and evaluation guidelines and in providing resources for mediation programs and research,” according to DOJ officials.

The full report, Foreclosure Mediation: Emerging Research and Evaluation Practices, is available for download at justice.gov/atj/foreclosure-mediation.pdf.